Supreme Decree 21260/1986 declared the salt flat a Fiscal Reserve. It belongs to the department of Potosí in the provinces of Daniel Campos and Nor Lípez and includes five municipalities: Uyuni, Colcha-k, Tahua, Llica and Salinas de Garci Mendoza.

The communities make their living from artisanal salt extraction, which is then distributed throughout Bolivia. Some communities have organized themselves since 1990 to exploit borax and ulexite, two non-metallic minerals from the Uyuni salt flat. 

The Uyuni salt flat is the habitat of three species of South American flamingos: Chilean, James and Andean; in addition, giant cactus is found on the islands. Water availability is low because there are only two rivers: the Grande de Lípez, which has been affected by tailings dams, and the Colorado River, which flows into the salt flat. On the other hand, tourism has increased since the 1990s, putting pressure on the ecosystem as demand for services increases.

Lithium industrialization in Bolivia?

Bolivia's historical dependency on the international demand for raw materials needs to be considered when approaching the Bolivian lithium industrialization policy. 

The development model proposed by the Bolivian Government in 2007 expected overcoming the primary export pattern through state control of natural resources and their industrialization, so surpluses would be transferred to the plural economy, such as the peasant economy, mining cooperatives and other informal sectors. The goal of this model was to achieve a good life for the entire population. 

In the case of lithium from the Salar de Uyuni, 100% state industrialization was proposed, with Bolivian technology and labour, from salt exploitation to battery production (former-National Management of Evaporitic Resources (GNRE, 2011). As a way to contribute to the energy transition.

According to the former-National Management of Evaporite Resources, the project would be carried out in three phases: Phase I included a pilot-scale production of lithium salts and semi-industrial production of potassium chloride in Llipi, south of the Salar de Uyuni. Phase II included the industrial output of the pilot plants, and Phase III, of the manufacture of cathode materials, electrolytes for the manufacture of lithium batteries. 

Phase I to produce lithium carbonate did not conclude satisfactorily because the raw material is not appropriate to make batteries, so its industrial production is not guaranteed to fulfill Phase II and move on to Phase III [1]. The construction project of the lithium carbonate industrial plant in Llipi, south of the Salar de Uyuni, was reformulated by a German company contracted. Then it delivered it to a Chinese company through a turnkey contract in May 2018, with no results to date. The Potassium Chloride industrial plant is in operation. However, it is far from reaching its maximum capacity because there are no external buyers for the raw material, in addition to its high production costs, due to the lack of inputs in the domestic market [2].   

The 100% state industrialization strategy changed in 2017 when the Government created the company Yacimientos de Litio Bolivianos (Law 928 of 2017) to replace Empresa Boliviana de Recursos Evaporíticos, to enable the association of the new corporate state company with foreign capitals for the production of the raw material. Five months after the return of MAS to the Government, on April 30, 2021, it launched an international call for foreign companies to invest in direct lithium extraction technology, revealing the failure of the state industrialization of lithium again: the project which was paralyzed during the transitional Government (coup) in 2020 was handed it over to transnational interests. Lithium will be the priority of industrialization towards the bicentennial (2025) [3].

The so-called industrialization of lithium and issues socio-environmental issues it neglects

- Potosí’s economic and social issues.

Despite being the primary mining producer in the country with around 90% of the departmental GDP and having the highest export values, according to the Center for Development, Labor and Agrarian Studies (Cedla)'s Multidimensional Poverty Index (2019), Potosí is the poorest Bolivian province with an intensity of poverty of 68.5%. That is, its population suffers from a lack of access to monetary resources and are being left behind in critical dimensions: related to their standard of living, access to quality employment, health and education and loss of power and voice of the population, which has generated more poverty, due to cooptation and fragmentation of social organizations and lower participation and influence in political decisions [4]. 

The department of Potosí's unfulfilled demands of the national government date back to 2009. Among their demands, we can include: (i) cement, glass and lime factories; (ii) addressing Cerro Rico de Potosí risk of collapse; (iii) an international airport; (iv) the border dispute with Oruro; (v) zinc concentrate treatment plant; (vi) hydroelectric plant; (vii) three hospitals; (viii) two dams; (ix) wind energy; (x) relocation of COMIBOL offices to Potosi which are currently located in La Paz; (xi) human resources in health centers and equipment; (xii) double highways; (xiii) etc. In addition to these demands was their discontent with the national Government for delivering the lithium deposits to German company ACI Systems. The contract was annulled in 2019 by the Government as an attempt to curb social protests after a large part accused it of the population of electoral fraud in 2019 [18].

It should also be considered that, in 2007, FRUTCAS requested the industrialization of lithium as part of its development plan for southwestern Potosí. However, over time the state-owned company distanced itself from the organizations and the departmental and municipal governments without knowing the actual results of the project's progress. From time to time, commissions from the central Government, headed by the president and other high authorities, visited the project to announce investments or to carry out partial inaugurations, taking advantage of the opportunity to launch grandiose speeches about the manufacture of batteries for the EV industry. Government officials argue that having the main lithium reserves on the planet would allow Bolivia to control the lithium market and prices.

Thus, the communities around the Salar de Uyuni are demanding greater benefits from mining for the department, such as infrastructure and higher royalties. Their resources are not negotiated with foreign companies without their consent. Although public consultations with the communities have been developed, these "do not necessarily follow international normative criteria, towards some communities and municipalities, which have had important limitations in terms of information" [5]. However, it is important to point out that according to the mining law, the consultation is informative; from that perspective, the communities do not decide whether or not to go ahead with the mining activity since "The State reserves the right to decide on this aspect" [6]. 

In this general context of tensions between the Government and the department of Potosí, which have become more intense over the years, there are aspects of the alleged industrialization that affect the communities surrounding the exploitation that are not being seriously considered. 

- Water scarcity:

According to researcher Barbara Jerez of OCMAL, "Organizations in Rio Grande and Uyuni have expressed concern about the groundwater required for this type of mining extraction, as well as the lack of information in the communities about this planned economic activity in their territories."[7] In addition, the communities of Rio Grande and Uyuni have also expressed concern about the lack of information on this economic activity projected for the future in their territories.  

 Therefore, another urgent issue for the communities of the Salar is water scarcity. For example, while one of the most water-intensive mining activities, lithium mining, is being carried out, "less than a quarter of "Colcha K households (one of the municipalities closest to the lithium carbonate and potassium chloride plants) have access to basic sanitation, and only a little more than half have access to drinking water" [8]. In addition, the region is already suffering from the pressure of intensive water exploitation in Bolivia's largest mine: San Cristóbal, also located in the municipality of Colcha-k.

As Ebeliz Fuentes points out, in Colcha K, "the mining companies (including YLB) use wells as water sources, which leads to intensive use of groundwater, over which there is little or no control. The researcher adds that these "processes for obtaining lithium have low yields, so water is not used efficiently" [9].  

Vivian Lagrava Flores, from the Human Rights Collective Empodérate, from Potosí, denounces that lithium exploitation is not environmentally friendly, it is not sustainable. No exploration or exploitation activity is sustainable" [10]. At the same time, he adds: "We must watch over the human right to drinking water. Unfortunately, this is what we see the least in these activities" [11]. In this way, the urban population demonstrates its concern about the potential negative impacts of lithium mining, which they already observe in their Chilean and Argentinian neighbours in their tourist activities and nature.

- Lack of information and participation:

As described by the Business and Human Rights Information Center, "there are communities further away from the lithium development zones that would not have a share in such benefits... and for the same reason, they have a more critical perspective" [12] towards the projects. Towns such as Colchani, located close to the salt flat, "have expressed claims and demands due to the impacts of lithium in the water -since they do not have drinking water and are salt producers- and the risks of displacement of flamingos, being communities whose economy is related to tourism" [13].

In short, it seems that the communities will have to relegate their aspirations for better living conditions since after having spent around US$ 1 billion in the industrialization of lithium, there is no benefit for anyone: no raw material, no batteries, no royalties, no employment, nor the multiplying effects of occasional industrialization of lithium in the department of Potosí.

- Affecting livelihoods:

At the same time, an aspect that has not been sufficiently studied is the environmental impact of a "careless"[14] industrialization of this intensive mining activity on the economic activities of the communities living in proximity to the salt flat: trade, "tourism, quinoa, llamas, and the collection of roots, plants and herbs in which the Ayllus settlements and communities in the region are partly - but not only - involved, further dislocating the rural society of Southwest Potosi and the flat salt environment - already increasingly dislocated and affected by the impacts of the global economy on it"[15].

Regarding the impact on tourism, the communities report the impact on cultural sites. "One example is the case of Llipi Hill, where the YLB plant operates, which is considered a ritual and sacred site for the Rio Grande community. The construction and closure of traffic to unauthorized personnel provoked the questioning of this community" [16]. Likewise, with what has been done in the experimental base in the southern part of the lake near the mouth of the Grande de Lípez river, it is evident that large areas have been affected by heavy machinery for the undermining and conditioning of the evaporation ponds, dams, opening of roads and construction of embankments. It is questionable whether environmental legislation and environmental management have been taken into account for this project. 

Beyond the environmental effects that will affect a small portion of the Salar de Uyuni in LLipi, it is worth mentioning the macro-environmental impact that, although not immediately perceptible, could have a more significant impact on the livelihoods of the populations living near the mine. We are talking about the affectation of the region's water system or pollution due to polluting dust from the exploitation, spread in the air.

2019 political crisis and lithium:

On October 2, two leaders of the Civic Committee of Potosí "began a hunger strike demanding the cancellation of lithium exploitation contracts with German and Chinese firms" [17]. Five days later, on October 7, 2019, Potosí entered an indefinite strike as a way to intensify its rejection of the contract signed between YLB and the German company ACI Systems to create a joint venture between the national Government for the production and export of lithium raw material [18]. The local population also mobilized to obtain higher royalties for Potosí for the exploitation of lithium and greater benefits for the people. According to the Committee, the law entailed a "surrender" of the Government's natural resources to a foreign company. Likewise, "no one consulted the people of Potosí on the matter"[19]. Another example of how consultation processes with local populations have been absent in these processes. 

The Government of Evo Morales cancelled the contract with the German firm on November 3 to avoid the generalized discontent of the population, who now accused him of having signed the agreement and also of electoral fraud in the presidential elections [20]. Evo Morales resigned on November 10, 2019, when the protest in Potosí had taken another course. As a result of this situation, several conspiracy theories associated with the interests of U.S. imperialism for the lithium resources arose. Among them, one referred to a tweet by Elon Musk, owner of the most important U.S. electric car companies (Tesla), who referred to what happened in Bolivia as "We will coup whoever we want! Deal with it" [21]. This response was immediately taken as evidence that the U.S. had supported a coup in Bolivia to secure lithium for his company.  

"The plurinational State of Bolivia assures the world a sufficient supply of lithium… This is the commitment of the Bolivian State to fight global warming"

There is a global urgency to reduce carbon emissions in order to fight climate change rapidly. The goal is to limit carbon emissions to net-zero by 2050. A transition from current fossil fuel-based energy systems to renewable energy systems is being promoted to achieve this goal. Lithium has been characterized as a critical material for the energy transition given its essential role in manufacturing lithium-ion batteries for electric vehicles (EVs) as an alternative to conventional cars that consume fossil fuels. 

In this context where lithium is a key material for the energy transition, the populist Bolivian Government proposed the industrialization of 100% state-owned lithium in 2008 to contribute to a change in the world energy matrix, but also, based on its conception of a plural economy, to contribute with the surplus to the development of the region's production methods which are lagging behind.

According to the former National Management of Evaporitic Resources, it said at the time that "The plurinational State of Bolivia assures the world a sufficient supply of lithium contributing to a total change of the global energy matrix through: electric vehicles (EVs) and fuel for future nuclear fusion (clean electric energy) ... This is the commitment of the Bolivian State to fight global warming" [22]. Similarly, former President Evo Morales recently affirmed: "the [Bolivian] State assures the world a lithium supply in sufficient volumes for the operation of electric vehicles... at a fair price without speculation or monopoly" [23]. However, many experts in the field, among them Cristhian Stalberg, director of Natural Intelligence and consultant to the United Nations Development Program (UNDP), "the industrialization of lithium has not yet materialized." According to the UN expert, the industrial-scale exploitation of lithium will significantly impact environmental pollution and climate change in Bolivia [24]. Faced with the failure of this state project, the Government is preparing to sign agreements with foreign companies to make the production of raw material and its export feasible. At the same time, the hope of the majority of the population for a better standard of living continues to be ignored.

The social discontent expressed in mobilizations of social organizations responds to unanswered local demands that are becoming more intense, such as the lack of infrastructure, environmental problems due to mining exploitation, scarce productive development, and precarious health and education systems. The Government has ignored recent social mobilizations against its extractivist policies by associating them with U.S. imperialism that conspires to take over natural resources. In reality, social movements have been protesting and mobilizing against the Government and its policies, which seek to deepen and accelerate the primary extractivist pattern, continuing in this way its rentier and extractivist character. 

Regarding the construction of the Lithium Carbonate Industrial Plant, YLB states that it will have a production capacity of 15,000 tons (t) per year”.

https://www.comunicacion.gob.bo/?q=20210430/32381