Will Bolivia Be Ruined, Improved, or Hated Because of Electric Cars?

With growing speculation that electric cars and other energy efficient vehicles will soon dominate markets worldwide, Bolivia is a nation that perhaps stands to benefit (or suffer) more than any other from the energy revolution.

Most electric cars will be powered by lithium batteries, and Bolivia has more lithium than any other nation worldwide. How this development will affect Bolivia is unknown, but will squarely place the South American country at an intriguing and crucial crossroads.

Bolivia: a Microcosm of World’s Struggles and Possibilities

Even though Bolivia might have incredible economic growth thanks to future sales of lithium, it does not change the fact that Bolivia currently struggles in almost every possible way.

The government is unstable, in part because of a fight over one of Bolivia’s other abundant natural resources: natural gas. I have written before about how President Evo Morales’ government plans to redistribute land, a controversial move that many of the country’s wealthier citizens think amounts to theft, despite claims that some wealthy ranchers have enslaved tribal people. On the other hand, regardless of what you think of modern socialism, or of Evo Morales and his followers, I think it is reasonable to say that with two thirds or more of the country living in poverty, the idea to redistribute land is not without its supporters.

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When a developing country is as poor as Bolivia, a central question we have to ask ourselves is how might it be possible for quality of life to be improved for its people? To the best of my knowledge, the primary model of economic development for thousands of years has been to sell and transform what is naturally available from the earth. How often is it that many people benefit from the extraction and sale of natural resources rather than a few? Is there an alternative economic model? If total natural resource extraction, rather than resource conservation is the model we follow, where will this lead us in years to come from an environmental standpoint? Will there be any nature left to exploit?  These are important questions to keep in our minds as we examine the case of Bolivia and lithium closer. It also helps us to better consider the dramatic political climate in Bolivia, as manifested currently in a form of socialism.

Evo Morales has already nationalized the oil and gas industries of Bolivia, in theory making the profits benefit all Bolivians equally. Perhaps he has wants to change the idea that Bolivia is “a donkey sitting on a gold mine of natural resources,” because he is also a fan of the idea to make Bolivia a major exporter of lithium. In fact, according to an article published recently on www.hybridcars.com he would like Bolivia to be the world’s leading producer of lithium. But the article also reports that Morales has rejected offers from at least 4 auto companies to buy from Bolivia, including Toyota and Mitsubishi, saying that they simply want to take the lithium away for little compensation.

Instead he would like Bolivia to become wealthy from its lithium, much like Venezuela and Saudi Arabia with their oil– on Bolivia’s own terms. I like this idea in principle. To date, many of the world’s natural resources have been exploited by developed nations and corporations, leaving other countries impoverished and often polluted despite their ownership of these resources (see this case in Ecuador, for instance).  So I guess if Morales’ idea to make lithium of value to the entire people of his country is put into practice, it would be hard for lithium to be a negative force in the country (excepting that lithium can be toxic and probably through extraction could have other negative environmental consequences– more on this topic later).

But despite good intentions, I’m not entirely sure that countries who become powerbrokers of resources tend to have success spreading the wealth. Do the majority of a country’s citizens really benefit in countries like Venezuela and Saudi Arabia where oil is abundant? I tend to think no personally, although I’m not aware of all the examples that might be available, and I still read conflicting reports about what’s happening in Venezuela.

Even if we think optimistically that sales of lithium will help improve the lives of Bolivians, it is not an endless resource, and this could be a problem.

Will There Be Enough Lithium for the World to Switch Entirely to Electric Cars?

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