Russia and China Lead in Bolivian Lithium Grab

Russia, much like China, has secured access to Bolivia's vast lithium reserves, estimated at 23 million tons, representing some of the most abundant lithium deposits globally. However, Bolivia's apparent preference for partnerships with China and Russia has raised concerns among experts. They cite worries over the countries' lax environmental standards, insufficient regulations for their corporations, and the associated risks of corruption and inefficiency.

The Bolivian government has already inked agreements with the Chinese consortium CATL BRUNP & CMOC (CBC) and the Citic Guoan Group. Additionally, in mid-December 2023, Bolivia finalized a $450 million deal with the Russian state firm Uranium One Group, a subsidiary of Rosatom, granting Russia access to its lithium reserves. Under this agreement, the Russian firm is set to invest in Bolivia over a two-year period for a pilot lithium production project in the community of Colcha K, located in the Potosi department. The project will unfold in three phases: the first aims to produce 1,000 tons of lithium carbonate annually, followed by an escalation to up to 8,000 tons in the second phase and an additional 5,000 tons in the third phase. Notably, this contract marks the second agreement signed with Uranium One Group. The initial contract, sealed in June 2023, outlined plans for the construction of a lithium carbonate industrial complex in Pastos Grandes, situated in southwest Bolivia.

As Russia assumes a significant role in Bolivia's lithium extraction endeavors, concerns linger regarding potential environmental repercussions. There are apprehensions stemming from past instances where Russia's management of energy resources has led to environmental mishaps.

Similarly, China has also forged agreements in Bolivia's lithium sector. In January 2023, an agreement was reached with the CBC consortium, led by CATL, to invest a total of $1.4 billion in establishing two industrial plants for the direct extraction of lithium in the Salar de Uyuni, renowned as the world's largest salt desert. Subsequently, in June 2023, Bolivia signed a contract with Citic Guoan, granting the company rights to exploit lithium reserves in the Salar de Uyuni. Notably, on January 18, 2024, the CBC consortium further solidified its cooperation in lithium exploration in the Salar de Uyuni through another agreement, entailing an additional investment of $90 million.

However, concerns persist regarding China's operations in the Xinjiang Uyghur Autonomous Region, where numerous lithium processing and manufacturing facilities are situated. The region has been marred by allegations of mass internment and forced labor of Uyghurs and other minority groups, casting a shadow on China's human rights record.

It is imperative for countries, including Bolivia, to take into account the potential socio-environmental impacts associated with partnerships with winning bidders. Both Russia and China have faced criticism for their histories of human rights violations, labor abuses, and environmental negligence. It underscores the importance of vigilance regarding human and labor rights issues within each country, irrespective of the actions of national or multinational corporations. Regrettably, violations of laws, human rights, and environmental misconduct are not confined to Russia or China alone. All nations must prioritize addressing such concerns to ensure sustainable and ethical practices in natural resource utilization.