Bolivia’s lithium deals with China, Russia in limbo
Bolivia is facing mounting public backlash over contracts signed with Chinese and Russian companies late last year to exploit its vast lithium reserves, with community groups arguing the agreements offer no real benefits to locals.
Critics also question the feasibility of the UOG deal, which gives the company just 18 months to build a plant before the contract expires — an unusually short timeline that could leave Bolivia saddled with unfinished infrastructure.
These concerns have fuelled speculation about the deals’ transparency and economic viability, with protesters interrupting a government conference on the contracts.
Under Bolivian law, foreign investors must conduct free, prior and informed consultations with local communities and carry out comprehensive environmental impact assessments before industrial projects can move forward. The agreements must then be approved by the country’s legislature.
With public consultations a full-tilt, government representatives have said at these meetings that Potosi alone would generate estimated royalties of $800 to $900 million over 30 years, equivalent to $30 to $35 million annually.
Delayed lithium dreams
Despite Bolivia’s massive lithium reserves — estimated at 23 million tonnes — the country has struggled for decades to develop a viable lithium industry. Political instability, a state-controlled resource extraction model and high magnesium levels in its lithium deposits have made large-scale production challenging. Unlike neighbouring Chile and Argentina, Bolivia’s lithium remains largely untapped, contributing little to the global supply.
YLB opened Bolivia’s first industrial-scale lithium plant in late 2023, but it operated at only 17% capacity last year and is expected to reach just 23% in 2025.
Meanwhile, government officials, including Vice Minister of Energy Resources Exploitation Raúl Mayta, insist the contracts “are not written in stone” and that they will continue to hold technical meetings with various sectors to address concerns.
The Bolivian government maintains that these partnerships will will fast-track lithium industry development, promising the country will retain 51% of profits.