Argentinian and Bolivian leaders discuss creation of regional lithium cartel
Bolivian President Evo Morales and Argentinian President Mauricio Macri are expected to hold talks today on a number of energy-related issues.
However, the two leaders will likely focus on the lithium industry. Along with Chile, Bolivia and Argentina make up the so-called “lithium triangle.” The three countries together possess more than half the world’s deposits of the light metal (approximately 54%). Lithium is a significant component of the batteries that power smartphones, tablets, laptops and electric cars.
Due to the global explosion of demand in all of these electronics—especially electric cars—lithium is currently a very lucrative economic export. Prices have consequently risen since. Since 2015, for example, the price of lithium has nearly doubled.
Presently no comprehensive agreement on lithium production exists among the three countries of the lithium triangle. Expect discussions today to focus on ways to begin establishing an agreement on lithium—similar in structure perhaps to the Organization of Petroleum Exporting Countries cartel. The three countries acting together could significantly impact lithium prices. This economic power over prices of a prized natural resource translates to significant geopolitical clout on the economic world stage.
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