The new Bolivian Energy Minister just announced that his country will honor the previous leftist government’s deals with China and Russia them in order to reassure investors after the new president’s pledge to review. That’s a surprisingly pragmatic move in the context of contemporary hemispheric geopolitics amidst Trump 2.0’s so-called “Donroe Doctrine”, which essentially seeks to remove its adversaries’ strategic influence in the Americas, including in the critical minerals industry.
China and Russia have agreements to extract some of Bolivia’s lithium, which is indispensable to the “Fourth Industrial Revolution”. Its reserves are estimated to constitute a whopping 20% of the global total, access to which was assessed to be one of the drivers behind the US’ Hybrid War on Bolivia that deposed its long-serving leftist president Evo Morales in 2019. As it turned out, he was democratically succeeded by fellow leftist Luis Arce a year later, with whom he then had a vicious falling out.
Anyhow, the point is that the US surprisingly failed to take advantage of the interim period between the Morales and Arce administrations to exploit Bolivia’s lithium resources, which preceded the new right-wing government’s decision to honor the lithium deals with China and Russia that it inherited. Objectively speaking, neither would have been able to do anything had Bolivia reneged on those agreements to award extraction rights to US companies instead, so it’s unclear why this didn’t happen.
Trump 2.0 basically let a critical minerals opportunity slip through its fingers despite the “Donroe Doctrine’s” goal of removing its adversaries’ strategic influence in the Americas. To be sure, it’s possible that they’ll review this “oversight” and “correct” it accordingly by applying the pressure required to obtain control over Bolivia’s lithium reserves, but the fact that the US hasn’t yet done so and allowed that country to publicly confirm that it’ll honor its contracts with China and Russia requires explanation.
The left was destroyed in the last election, so concerns about protests destabilizing the new pro-US right-wing government, or interfering with lithium exports to the US at minimum, aren’t relevant, unlike how they might have been up until this point. It’s also not possible that the US wasn’t aware of this opportunity since Bolivia’s new Foreign Minister told the Wall Street Journal last month that “We’re really interested in attracting U.S. investments…for the exploitation of our resources such as lithium”.
Therefore, the most reasonable explanation is that the US deliberately chose not to coerce Bolivia into reneging on its lithium deals with China and Russia so as to reassure investors exactly as its new Energy Minister explained as the rationale for honoring them, which would reassure US investors too. In contrast to China and Russia, the US doesn’t have any state-owned or -subsidized mining companies, ergo its reliance on private companies for extracting lithium in fulfilment of its national interests.
The US might have correspondingly calculated that creating the precedent of Bolivia reneging on critical minerals deals could come back to bite it if the political pendulum shifts left again in the future, the scenario of which might have spooked American companies from investing in its lithium reserves. By presumably advising its new right-wing allies in Bolivia to honor the deals with China and Russia that they inherited, the US ensured the security of its private companies’ likely investments in this industry.
