By Gina Baldivieso
La Paz (EFE).- Bolivia’s vast lithium reserves have once again become a political bargaining chip in the run-up to the Aug. 17 general elections, with opposition candidates and government rivals trading accusations over multi-billion-dollar contracts with Chinese and Russian firms.
Experts warn that the deals, worth about 2 billion dollars, offer little benefit to the country, while production remains far below targets.
Lithium was also a headline issue in the 2020 campaign, but analysts say current promises remain superficial, with claims of backroom agreements to hand over the resource in exchange for political support.
Contracts under fire
In recent months, fierce debates in Congress have centered on two contracts for lithium exploitation backed by Bolivian President Luis Arce but opposed by the opposition and lawmakers loyal to former Bolivian president Evo Morales (2006-2019), now estranged from the government.
The Arce administration says Bolivia holds 23 million metric tons of lithium, most in the Uyuni salt flats in Potosí.
In 2023, the government inaugurated a state-run industrial complex with an annual production capacity of 15,000 tons of lithium carbonate, using evaporation ponds.
But José Carlos Solón, a researcher at the Solón Foundation, told EFE that both Bolivia’s lithium quality and its chosen extraction method are problematic.
Unlike Chile’s Atacama salt flat, Uyuni’s higher magnesium content complicates extraction, requiring costly and complex separation processes.
Design flaws in some evaporation ponds have further hindered operations. Production currently stands at about 3,000 tons, less than 20% capacity.
The industrial plant was launched under Morales, while Arce has embraced Direct Lithium Extraction (DLE) to speed up industrialization.
This strategy led to contracts with China’s CBC and Russia’s Uranium One Group, which Indigenous communities in Potosí rejected, citing the government’s failure to obtain prior consultation as required by law.
Solón warned that the agreements require Bolivia to repay investment and interest, cover operating costs, and pay service licenses, with poor profit-sharing terms and no environmental impact studies.
Campaign pledges on lithium
Leading presidential contenders, centrist businessman Samuel Media and right-wing former president Jorge “Tuto” Quiroga (2001-2002), say they would first audit the Morales and Arce projects before seeking foreign investment, a common pledge among candidates.
Center-right candidate Manfred Reyes Villa proposed pre-selling production to raise 10 billion dollars, while centrist Rodrigo Paz Pereira advocates restructuring the state-owned Yacimientos de Litio Bolivianos (YLB).
Former ruling party senator Andrónico Rodríguez wants to form alliances with Argentina and Chile.
Solón argued that most candidates “are far from understanding the challenge behind lithium,” repeating general industrialization rhetoric despite years of slow progress.
“Lithium is like a complex pharmaceutical industry, with huge technological, investment, and implementation challenges,” he said.
While campaign rhetoric paints lithium as an economic savior, Solón urged a more sober outlook.
Moderate forecasts for 2030 put prices at 15,000 to 17,000 dollars per ton. Multiplying these by the combined projected output of the state plant and foreign-operated facilities, about 59,000 tons, would still fall far short of past revenues from natural gas, once Bolivia’s economic backbone.
“Lithium is not a gas; it will not save us,” Solón said. “It could help diversify the economy, but we must look beyond extractivism to consider what else can be done.” EFE
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