Bolivia must pay $2 billion and interest to Chinese and Russian companies building lithium processing plants in the country, Bolivian newspaper Elle Dover It has been reported Although on Wednesday, Bolivia had already offered priority extraction rights.
Bolivia has some of the world's largest lithium reserves, and a wide range of devices, including smartphones and laptop computers, are essential materials for the manufacture of batteries for electric vehicles. According to US Geological Survey, Bolivia pride 23 million tonnes of lithium. However, there are few industrial lithium production or commercially viable reserves in the country.
recently June 2023Socialist President Lewis Earth has signed a contract with China-owned Citique Guan and Uran Wan Group, a subsidiary of Russia's Rosatom, with the two companies building two projects with Bolivian state-run Lithium Sediment (YLB) company. We won a total of $1.4 billion to do it. Lithium carbonate processed plant. ARCE signed to Bolivia another That month, we handled Chinese battery company CATL build The other two lithium plants in the country are plants built in a total of four China or Russia.
Elle Dover It reported that it has considered contracting YLB with CBC Investment Limited, a CATL subsidiary, and a contract with Russia's Uranium 1 Group.
According to a contract considered by the newspaper, Bolivia must pay more than $2 billion to Chinese and Russian companies in addition to interest rates, “inflation compensation” and “patent payments” to develop lithium plants. It won't be. The transaction also provides both companies with “priority treatment” in the commercialization of lithium carbonate produced by the state of Bolivia.
Elle Dover The report said the company in Bolivian YLB province had justified the terms of the contract on the ground that it had to pay an amount so that the plants that have not yet been built remain in the hands of the Bolivian province.
The newspapers allegedly rejected controversial deals, and questioned the interest rates Bolivia must pay to state-owned Chinese and Russian companies in addition to the commercialization clause of preferred lithium. presented. Critics of the contract also question the profitability, given that if the product is priced at $10,000 in the global market, revenue is projected at $30,000 per tonne.
Bolivian MP Guillermo Benavidez said Elle Dover The signing of a contract with a CATL subsidiary is a violation of national law and represents a “bad deal” for Bolivia. The lawmaker pointed out the “lack of state control and technology transfer” as evidence that the country suffered damage. Benavídez argued that the financial burden of the contract for capital payments was “very high.” The interest rate is 12% and the inflation compensation rate is 2.5%. risk. “
“It is impossible to calculate the company's return because neither production costs nor cash flow are defined,” Benavídez said. Elle Dover.
Founder of the Geneva Club, a Swiss-based Bolivian entrepreneurial organization – Ricardo Albabarderrama reportedly considered a signed contract between Bolivian YLB and Russian uranium group – Founding of the Geneva Club The person is being told. Alba Valderama told the newspaper that in exchange for a billion dollar investment, Russian companies dominate the region where lithium is most concentrated in Bolivia's Uyuni Salt Flat region for an extended period of 22 years. He explained that he would sign a contract.
Along with the construction of the lithium plant, Alba Valderrama argued that the Russian company is expected to recover its investment through “additional operation, maintenance and marketing agreements.” The surplus barely covers the state's costs. Alba Valderrama questioned the legality of the deal, which he accused the Bolivian state of violating constitutional regulations that require it to take control and direction of its natural resources.
“International lithium prices may not be as high as the level required for profitable production. This is estimated to require prices of more than $20,000 per tonne and production of more than 100,000 tonnes per year. “A lot of people want,” said Alba Valderama.
Several civil society organizations in the southern city of Potosi and the capital of La Paz went to the streets on Monday Protest against the lithium deal signed by the Bolivian government with China and Russia. Potosi protesters reportedly marched in photos of eight Bolivian lawmakers who accused them of “traitors of the country” to approve a lithium plant contract between Bolivia and the two countries.
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Protesters accused the contract of being signed “behind the people's backs,” and in the process denounced the lack of transparency and discussion with local residents. Protesters also accused both Chinese and Russian companies of not having “sufficient capital” to cover the operating costs.
“The president of the state who distributes resources behind his people's backs are traitors, and those who join as lawmakers to approve this type of contract are also traitors,” a statement from the Potosinista Civic Committee read .
Christian K. Calzo is a Venezuelan writer and documents life under socialism. You can follow him on Twitter here.
