Bolivia, the owner of the world's largest lithium reserves, is trying to capitalize on this valuable resource. Despite prices plummeting from 2022 highs, the country is pushing forward with large-scale investments to take advantage of the growing battery industry.

"With the two new contracts, we plan to reach 49,000 tons of lithium carbonate annually within three years," Omar Alarcon, president of Bolivia's state-owned lithium company Yacimientos de Litio Bolivianos (YLB) told Bloomberg.

YLB's deals with Russia's Uranium One Group and a Chinese consortium totaling nearly $2 billion. The agreements include the construction of three processing plants. The Russian-backed facility is set to produce 14,000 tons annually, while the Chinese partnership aims to add 35,000 tons.

Despite holding an estimated 21 million tons of lithium beneath the Uyuni salt flat in the southern region of Potosí, Bolivia's current production is negligible.

Key challenges include the high altitude of its deposits, the logistical constraints of being landlocked, and a high concentration of magnesium in its brine, which complicates extraction.

Together, these hurdles make the production at current prices of around $10,000 per ton barely viable. To address these obstacles, the government is banking on direct lithium extraction technology, which promises to reduce processing times and increase efficiency.

While Bolivia's ambitions are laudable, environmental concerns loom large. Last year, Potosí Senator Elena Aguilar voiced concerns over water usage for Mongabay.

The authors stress that effective governance must include stringent monitoring, local engagement, and enforceable penalties for non-compliance—a long shot for a country such as Bolivia, which boasts a Corruption Perceptions Index of 29, the sixth-worst in the LATAM region.

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