Bolivia Is the Saudi Arabia of Lithium

tcd004 writes "You can literally scrape valuable lithium off the ground of many Bolivian salt flats. The country is poised to be the center of world lithium battery production, reaping the benefit of the metal's skyrocketing value. 'The US Geological Survey says 5.4 million tons of lithium could potentially be extracted in Bolivia, compared with 3 million in Chile, 1.1 million in China and just 410,000 in the United States. ... Ailing automakers in the United States are pinning their hopes on lithium. General Motors next year plans to roll out its Volt, a car using a lithium-ion battery along with a gas engine. Nissan, Ford and BMW, among other carmakers, have similar projects.' However, the government fears foreign countries might exploit their natural resources, so for the time being, the salt flats remain untouched."

Comments

Can't Help but be Supportive

[explosivejared]

I generally lean towards advocating market based solutions and free trade in most economic situations. Coming from rural southwestern Virginia, however, and seeing the grip the coal industry has on politics in some areas around here I know how people can really be disadvantaged by mismanagement of natural resources. I also think back to the damage done by the informal imperialism in the Middle-East at the hands of BP (formerly known as the Anglo-Iranian Oil Company) and their like. In this case I can't help but be supportive of Morales' efforts to put these lithium reserves to work for the Bolivian campesinos. Having mineral resources has proven to be a curse just as often as it has been a blessing in modern history. Here's to hoping one Latin American government can get it right.

Re:Can't Help but be Supportive

[eldavojohn]

My father actually works at one, funnily enough. It was a matter of economics and not ideals which is rather disheartening, but we had mountains of debt and there aren't exactly a lot of good paying jobs to go around.

I don't mean to attack you or your father (or even the region as a whole) but how self sustaining is strip mining? I mean, has a generation or two of jobs and income been worth something that will forever be exposed rock? It's plain to me that even the timber industry would have lasted longer.

I don't want to sound preachy a la The Giving Tree (I realize I do) but our ancestors saw those mountain top ecosystems as worthless ... and now maybe we see them differently. Bolivia should be wary of losing their salt flats and deserts even if they think they are wastelands. Limit strip mining and plan for the future, even if it's just setting aside funds to deal with inevitable environmental impacts. Even if it's using 10% of your strip mining income to plant/repair forests in other parts of your state.

The money is drying up for West Virginia and what is left? West Virginia has many areas where there once were trees and snow and water runoff but for the sake of a few decades of jobs there is nothing ow but heavy metals in their drinking water ... possibly nothing for a long time. The world has been making poor decisions for far too long, think about your future.

Re:Can't Help but be Supportive

[explosivejared]

Have you been to West Virginia? It's dirt poor now. They have both poverty and environmental destruction. People want to act like there is a constant negative association between the two, when there is none. I wouldn't advocate a complete end to coal mining like some I know. Just from observation the whole practice could be a lot saner.

Morales has no intention of leaving the lithium on the ground. He has example after example of resource rich developing country gaining no benefit from allowing foreign firms come and extract said resources. That lithium is a Bolivian resource and Morales government has every right to negotiate the best price he can for the Bolivian people, and to keep the extraction process from causing negative externalities. Practicing sound economics does not mean giving into to corporate imperialism.

Re:Can't Help but be Supportive

[Samy Merchi]

"it may make sense for them to leave the Lithium where it is, collecting interest as an investment of sorts"

What needs to also be remembered is that what is valuable today may not be valuable tomorrow.

Lithium may be valuable today for batteries, but what happens when a new battery technology is invented that is based on something other than lithium?

It would be smart to sell your lithium resources before that happens.

So just waiting and saving your natural resources may not always be the smartest move. Like stocks, you want to sell them at their peak value. Will lithium be more valuable or less valuable in the future? That is the question to ask here.

Bolivia's new future

[snaz555]

0. Evil Bolivian liberals start talking about using the proceeds from sale of lithium for things like national defense, highways, electricity, water plants, schools, research facilities, health care, a functional judicial system - all this first-world stuff they could only dream of affording previously
1. Coup
2. Generals clean out subversives who think Bolivians should own their own natural resources, and make country safe for U.S. and European mining co's
3. Generals sell off complete and exclusive rights for pennies on the dollar - no taxation or local businesses involved; Generals get rewarded with nice personal kickbacks
4. Generals provide local labor for cheap. Very cheap. After all, they have a virtually infinite supply of desperate people willing to work for subsistence wages
5. After 10-20 years as the locals revolt because of the total sell-out, generals escape to a first-world life in luxury
6. As the locals refuse to accept the previous BS deal they kick out foreign mining co's and nationalize the resources
7. U.S. decries evil commies and does its best to destabilize said evil commie government, by interfering with elections, supporting "freedom fighters" (read: insurgents and terrorists), and generally attempt to turn back the clock. The pretext is demanding "free elections", which of course can be rigged to practically restore the previous order
8. After a generation everyone eventually gets tired of conflict, forget what they were fighting over in the first place, and things are allowed to return to some semblance of where they should have been at point 0. Only with a lot of bad history.

Been there, done that. Got the t-shirt.