The demand for this ‘white gold’ is going to be very high in the coming times. That’s why two big economic powers of the world are making every possible effort to get it. Even if for this they have to compete far away from their territory.
Atacama’s Lithium Reserves
The world is moving towards sustainable energy i.e. green energy and for this the thing on which the eyes of the world are focused, its large reserves are in three countries of Latin America.
Argentina, Chile and Bolivia are the ‘Lithium Triangle’ of the world where more than half of the world’s reserves of Lithium are. For this reason, the attention of governments and investors around the world is on this part of Latin America.
This mineral, which meets the energy needs of the future, is found in the batteries made for electric cars (battery-powered vehicles).
Internationally, the Lithium market is growing continuously and many players now want to set their feet in this field.
Countries like America and China also do not want to leave any stone unturned in trying to capture this important mineral.
“The world is moving towards new energy, and the world’s great powers are competing for control of the minerals needed for this,” says Benjamin Gaidon, director of the Latin America Program at the renowned Thicktank Wilson Center. It has become a battlefield.”
“China had already started in this matter while America was lagging behind. But now it does not want to lag behind China.”
Getty ImagesChina and America
China’s efforts
Chinese companies have been trying to find this mineral known as ‘white gold’ in every corner of the world for years.
For this, they have also made huge investments in countries of Latin America, where about 60% of the world’s lithium reserves are present.
US Geological Survey According to the report, according to the figures of the year 2022, lithium reserves of 860 lakh tonnes have been detected in the world.
The largest reserves are in Bolivia. After this, Argentina, Chile, America, Australia and Mexico are in this list.
While Chile leads in mining and large-scale production of lithium, Mexico is also becoming a major player in this North American market with limited lithium reserves of 1.7 million tonnes.
It is geographically close to the US and Canada and is becoming a center for the production of battery-powered cars.
In recent times, big car manufacturers like Tesla and BMW have built their factories in Mexico.
Mexican President Andrés Manuel López Obrador confirmed earlier this year that Tesla car The factory will be built in Monterey and will be about three hours away from Texas, USA.
in February this year bmw Had said that it will produce its new car from the year 2027 at its factory in San Luis Potosi, Mexico. This factory was built in the year 2019.
These countries have large reserves of Lithium –
- Bolivia – 21 million tonnes
- Argentina – 193 million tons
- Chile – 9.6 million tons
- Australia – 6.4 million tonnes
- China – 5.1 million tonnes
- Congo – 3 million tons
- Canada – 2.9 million tons
- Germany – 2.7 million tons
- Mexico – 1.7 million tons
- Brazil – 4.7 million tons
Source- US Geological Survey
Getty Imageslithium reserves
America’s anger
In March last year, General Laura Richardson, head of the US Southern Command, told the Armed Services Committee of Parliament that China was increasing investment in Latin America.
He warned, “China is expanding its footprint in Latin America and the Caribbean at the economic and diplomatic level and in terms of technology, information and military presence.”
He said, “This area is full of minerals and I am concerned that our adversaries can take advantage of this. It looks like they are investing in this area, but in reality they are exploiting the resources here. doing.”
Regarding South America’s ‘Lithium Triangle’ of Argentina, Bolivia and Chile, he said that “China is taking a very aggressive stand regarding this and is using advanced technology at the ground level in the field of lithium.”
What does China have to say?
At the time when America and other countries are planning to go on the path of becoming free from conventional sources of energy (hydrocarbons) in the field of energy, China has already started on this path.
He is already eyeing this important mineral named Lithium which is going to prove very important for the global market in the coming times.
Since 2001, China has long term plan Had made In its 10th five-year plan, it had considered sustainable energy as its main priority and started investing in electric cars from 2002 itself.
In January this year, China’s Natural Resources Minister Wang Guanghua said in an interview with the official news agency Xinhua, “China’s dependence on many minerals is largely on foreign countries. If the situation at the international level changes, it will affect its economic security and national security.”
In 2016, the Chinese government national mineral resources plan Presented in which he included the names of 24 strategically important minerals. This includes oil, natural gas, coal and shale gas, including iron, copper, aluminium, gold, nickel, cobalt, lithium and many more minerals.
According to the plan, these minerals are “essential to the nation’s defense and the country’s economic security, as well as being strategically important to emerging businesses.”
Reuters/Patricia Pintolithium battery
China’s investment boom in Latin America
On one hand, China is increasing its investment in mining related business in the countries of South America, and on the other hand, these countries of ‘Lithium Triangle’ also want to take advantage of China’s advanced technology and huge investment in the development of local industry.
- In February this year, three Chinese companies (CATL, BRUNP, CMOC) signed a $1 billion deal for lithium with a Bolivian government company. compromised Is. Under this project, by the year 2025, lithium can be exported on a large scale from here.
- The relationship between Argentina and China regarding lithium mining has deepened over the years. In the year 2022 alone, nine Chinese companies announced investment in different projects in Salta, Catamarca and Jujuri in Argentina.
- In June last year, a Chinese company signed an agreement with a government company in Argentina to produce lithium carbonate. two factories had settled for. This Chinese company makes batteries for Volkswagen and Geely.
- In the same year, a Chinese company has also announced a huge investment in Argentina for lithium mining. While the Chinese company making the car Chery Automobiles has also announced an investment of $400 million in Argentina for the production of battery vehicles.
- in January last year chile government entered into an agreement with a Chinese company for lithium mining. Under this, this company will be able to mine 80 thousand tonnes of lithium. Many more Chinese companies have announced big investments in the Lithium Industrial Park being built here in Antofagasta.
Getty ImagesXi Jinping
struggle between world powers
“The United States is seeking to strengthen its position in the global supply chain for critical minerals and technologies related to sustainable energy,” says Pepe Zhang, associate professor at the Adrien Arsch Latin America Center at the Atlantic Council think tank. It has become an issue of rivalry both technologically and geopolitically.
China is working fast in this matter. Pepe Zhang says that China’s investment in Latin America and its surrounding countries is very important in this matter
In 2020 and 2021, China had invested about $ 1.1 billion in this sector, but this year this figure may increase.
A researcher says, “In January alone, three Chinese companies have talked about investing one billion dollars in Bolivia.”
President of Brazil this week Louis Inacio Lula de Silva He reached China on a four-day visit on Wednesday to hold talks with Chinese President Xi Jinping. During this, at least 20 agreements of bilateral trade are to be signed between the two leaders.
issue of “national security”
Like China, America has also made it a priority to ensure its place in the supply chain of minerals for strategic reasons.
Last year, US President Joe Biden issued a statement Said, “Important minerals become vital for many types of modern technology and are vital to our national security and economic progress.”
The minerals that Biden mentioned in his statement include minerals like lithium and cobalt. He wrote that not only are they needed in the production of computers to household appliances, they are also very important in the technology of batteries, water mills and solar panels for electric cars.
Biden wrote that almost all the countries of the world are promoting the use of renewable energy sources by reducing the use of conventional energy.
In such a situation, it can be assumed that in the coming decades, their global demand will increase by 400 to 600 percent.
At the same time, the demand for lithium and graphite, which is very important for battery technology, “could be four thousand percent or more.”
Getty Imageslithium reserves
Tug of war between America and China
Benjamin Gaidan says that in this tug of war between China and America, China looks ahead of America.
He says, “China is one step ahead in this matter because the Chinese government is ready to invest heavily in Latin America for the production of batteries. While the whole focus of the US is to buy minerals for American companies so that they can produce sustainable energy. can do.”
In such a situation, the countries of Latin America have two types of options. It is possible that instead of exporting the mineral directly, they may find the Chinese deal better.
Benjamin Gaidan says, “But America also wants to overtake China in this matter. However, it cannot be denied that South America is trapped in this race between two big powers like America and China.”