The Tyranny of Lithium Extraction in Argentina – Global Research

the-tyranny-of-lithium-extraction-in-argentina-–-global-research

04-08-20 07:55:00,

In the middle of a raging Covid-19 pandemic, Argentina has decided to accelerate the lithium mining sector. This intensification is occurring as a part of the larger expansion of Argentinean extractivism wherein the country has decided to triple its mining exports to over US$10.7bn per year in the next decade.

For this, apart from copper, the government also mapped 15 new lithium projects. Preparations for managing and augmenting the developing lithium sector have commenced with the establishment of an association named Calbafina, tasked with organizationally buttressing the lithium sector.

The current economic expansion of the Argentinean lithium sector is occurring for two reasons. Firstly, despite the Covid-19 pandemic, the demand for lithium is set to increase and while “There has been a slowdown in capital commitments…the outlook for growth in lithium demand suggests it has merely been delayed but not derailed, and Argentina will play a key role in supplying global requirements.” EV sales are forecasted to grow from 2 million in 2019 to 26 million by 2030 and Orocobre, an Australian company operating in Salar de Olaroz, Argentina, says that the European demand for EVs will increase markedly and the lithium-ion battery manufacturing capacity will grow five-fold by 2029.

Secondly, Argentina is the most attractive destination for lithium investors and presents a suitable investment climate for mining projects. For the lithium bourgeoisie, the main outlet for surplus-seeking investible capital is the “Lithium Triangle” which has 70% of the world’s lithium brine deposits. This region is constituted by northern Chile, northern Argentina and Southern Bolivia. Chile and Bolivia are, therefore, the main competitors for Argentina. In comparison to Argentina, both these countries are either afflicted by the under-dose of free market fundamentalism or are experiencing cataclysmic political events.

In Chile, the deficiency of proper trade liberalization is the major impediment preventing the country from becoming the leading lithium destination. Through Decree Law 2,886 of 1979 and Organic Law of Mining Concessions of 1983, Chile instituted several regulatory reforms in the lithium sector:  lithium was declared as a strategic resource because of its use in nuclear fission; the prior authorization of the Chilean Nuclear Energy Commission was made a vital component of lithium mining procedures and private miners were required to either partner with the state or obtain a special permit called Special Lithium Operation Contracts (CEOL) to mine on their own.

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