Bolivia: Uncertainty Over Lithium Contracts With China and Russia
Photo: Asamblea Legislativa Plurinacional Flickr.
The Bolivian government faces obstacles in the Legislative Assembly regarding the approval of two key lithium exploitation contracts with Uranium One (Russia) and Hong Kong CBS (China). The Commission on Plural Economy rejected both agreements due to incomplete documentation, including missing annexes detailing financial commitments and quotas. According to Walty Egüez, president of the commission, these contracts will not be considered until the executive branch submits fully legalized and complete documentation.
The contract with the Chinese company includes a $1.03 billion investment to establish two industrial complexes using Direct Lithium Extraction (DLE) technology in the Uyuni salt flats. Meanwhile, the Russian agreement involves a $970 million investment for a plant capable of producing 14,000 tons of lithium carbonate annually through an evaporation system. While the government claims Bolivia would maintain a 51% stake, ensuring state control over the resource, legislators and representatives from Potosí have expressed concerns about the actual benefits for the country.
Bolivia holds one of the world’s largest lithium reserves, estimated at 23 million tons. However, the ruling party’s lack of a parliamentary majority and internal divisions within the Movement for Socialism (MAS) have hindered the approval of these strategic contracts.
Despite the legislative deadlock over lithium, the government successfully secured approval for two external loans totaling $400 million, aimed at water projects and disaster emergency relief. The first, worth $250 million, comes from the Inter-American Development Bank (IDB) and is designated for managing health and natural disaster emergencies. The second, a $150 million loan from the International Bank for Reconstruction and Development (IBRD) under the World Bank, focuses on improving water management for community irrigation.
President Luis Arce has accused legislators of deliberately blocking these and other loans as part of a political strategy against his administration. In December, he criticized the situation as a deliberate obstruction tactic designed to create an economic crisis that would favor emerging political figures.
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