Change of power in Bolivia and the Global North’s raw materials demand

While the causes of rapid political change in Bolivia are currently being sought within the accusation of the electoral fraud-related presidency of Evo Morales, more and more voices in Latin America denounce to see a connection between the national lithium industry and the changing power structures. Kathrin Meyer evaluates the multiple facets of this conflict.

Bolivia’s economy depends on the extraction and export of lithium.  (M M, CC BY-SA 2.0)


Political change

After months of protests, the nearly 14-year term of Bolivia’s first indigenous president, Evo Morales, ended after a forced resignation. The reason for the protests is seen in the election fraud accused by the opposition and international observers. The fraud is the result of evading, in which the evaluated national opinion was resolutely opposed to a constitutional amendment that would have allowed Morales to serve another term.

Opposing protestors and a new level of violence by the police and security forces contributed to the aggravation of the political situation in Bolivia. The protests did not abate even after Morales’ escape into exile in Mexico. Only the political sides were changed. Before the fall of the government, most demonstrators were opponents of the regime. Since the resignation of Morales, most of the recent protesters are former government supporters. Currently they are fighting against the self-proclaimed interim president Jeanine Áñez .

The abuse of power by Evo Morales is, therefore, not seen as the only reason for the abrupt political change. Demonstrators denounced the connection between the change of power and the national lithium industry, which is considered a strategically important resource for countries of the Global North to promote sustainable development.

Neoextractivism under Evo Morales

Like the economies of many Latin American countries, Bolivia’s core economy is manly based on the export of raw materials to the Global North. With the largest estimated lithium reserves in the world and through international agreements designed to ensure the creation of a global energy system transformation, Bolivia found itself in a new special trading position. The raw material is particularly important for the uptake of e-mobility, due to its role in the technology’s cornerstone: The battery.

During his political term, Evo Morales wanted to fundamentally change the negative relationship within the extraction industry by nationalizing the lucrative commodity sector. He pursued a neoextractivist policy aimed at redirecting commodity revenues into extensive social programs. In this way, poverty within the country could be significantly reduced. Due to the comprehensive social policy, the proponents of Evo Morales found themselves primarily in the ranks of citizens who had been neglected by former politics, such as farmers and indigenous people.

Lithium industry and international trading partners

A rising demand for lithium motivated Bolivia to push ahead with the development of national reserves to foster a promising industrial branch in the country. As the necessary technology and expertise in this area were lacking, new trade relations were established to remedy the situation.

During the last few years, the USA, China and many member states of the European Union have been negotiating projects on lithium extraction in Bolivia in order to secure their respective shares of the so called ‘white gold’.

In order to ensure further expansion of social policy, the national mining company COMIBOL and the Bolivian lithium company Yacimientos de Litio Bolivianos (YLB) acted as equal partners within the current lithium projects in Bolivia. The demand for an equal partnership showed that the country was unable to reach an agreement with many North American and European interested parties.

As a result, most Chinese companies received the promising order. In 2018, only one German company agreed with the state authorities on a project to promote lithium hydroxide, the medium-sized company ACI Systems GmbH. One year after the announcement of the joint project and one week before the fall of Evo Morales, however, he surprisingly stopped the joint project with the German company by decree without stating any particular reasons.

Beforehand, former supporters of Morales had demonstrated against the German-Bolivian project and the extraction policy associated with the exploitation of lithium reserves. Exorbitant socio-ecological costs, such as water shortages, possible expropriations of citizens living in the region around the Salar de Uyuni salt lake and too little profit sharing, led to protests against the incumbent government before the presidential election in late October and continued even after that.

According to opinions in social networks, the surprising dissolution and the subsequent coup attempt a week later show a clear connection between international interests and Bolivia’s lithium industry. Which, under Morales, was carried out not only for economic purposes, but also in the interests of society as such. At present, the current increase in lithium extraction by international companies is arousing old fears among the most affected population groups.

The path for Bolivia’s political future seems to be unclear. The opposition faces new elections without a promising political program, and the supporters of Morales have not been able to present a real heir to the former president.

Whether the change of political power in Bolivia was really directly related to the growing demand of e-mobility and lithium technologies remains uncertain. However, Evo Morales’ plans to return to the country as president and the withdrawal of the project termination with the German company ACI on Monday last week are at least causing confusion.

 

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Kathrin Meyer

Kathrin Meyer is currently enrolled in the Master's program "Environmental Sciences" at Universidad Nacional de Colombia in Bogotá. Her research focus is resource dependence and energy policy in Latin America.

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