The Coming Age of Lithium-Politics

by Alejandro Litovsky 9 February 2009

The future ‘zero-carbon economy’ will not be free of the geopolitics of natural resources that have dominated the 20th Century.

As carmakers, governments, and entrepreneurs around the world accelerate their bets on electric cars and infrastructures, a recent article in the New York Times reminds us that half of the world’s lithium reserves, the mineral required to manufacture the car batteries, are in Bolivia –a country that may not be as welcoming as global extractive industries would like.

“We know that Bolivia can become the Saudi Arabia of lithium,” said Francisco Quisbert, 64, the leader of Frutcas, a group of salt gatherers and quinoa farmers on the edge of Salar de Uyuni, the world’s largest salt flat. “We are poor, but we are not stupid peasants. The lithium may be Bolivia’s, but it is also our property.”

But peasant communities, who have for centuries relied on small-scale salt trading and are pushing for a share of the profits, could find themselves out-maneuvered by the central Government’s effort to quickly put in place the industrial infrastructures to exploit lithium on a large-scale.

The 20th Century has taught us about the so-called ‘resource curse’. From Venezuela to Russia, and Saudi Arabia to Nigeria, the discovery of oil has fueled corruption and inequality, reduced democracy and freedom, and fueled military interventions around the world.

Thomas Friedman talks about the First Law of Petropolitics: The price of oil and the price of freedom always move in opposite directions in oil-rich developing countries. He defines a coming Energy-Climate Era as one where ‘issues related to energy, its price, availability and impact on the world and the climate are going to really shape more politics than any factors as we move deeper into the 21st century.’

Lithium will soon begin to dominate the markets and politics of the 21st Century through new global supply chains and trade agreements between resource providers and battery manufacturers, such as China.

In this new age of Lithium-Politics, will new winners such as Bolivia follow the example of Russia, Venezuela and Nigeria, or will an imminent renewable energy revolution also bring distributed benefits and more transparent extractive industries? The way Bolivia decides to structure its policy, extraction and global trade of lithium will offer many clues about that future.

(Photo Credits: The New York Times)

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