By Aurora Lane | 2025-02-20

LA PAZ -- Bolivia's deputies, in a session marked by the ruling party's attempts to limit opposition participation and corruption allegations, have advanced a contract between state-owned Yacimientos de Litio Bolivianos (YLB) and the Chinese consortium CBC for lithium extraction in the Salar de Uyuni.

This contract, initially signed in November 2024, outlines the construction of two lithium carbonate production plants with annual capacities of 10,000 and 25,000 tons, respectively. The agreement stipulates that CBC will invest at least $1 billion and the Bolivian government will retain a 51% stake in the project.

However, critics have pointed out that this investment must be repaid with interest rates as high as 12.5%.

As the contract awaits further debate in the Chamber of Deputies and the Senate, opposition members and affected indigenous communities have intensified their criticism of the government's approach.

On February 6, the Plural Economy Commission approved a contract between Bolivia's state-owned YLB and CBC. Tensions escalated as opposition legislators faced restricted access to the session.

Reports indicate that opposition members resorted to climbing walls and forcing entry into the room where the vote was taking place, as the ruling party had closed their doors.

The approval process has sparked a significant backlash from various political and civil sectors, highlighting the ruling Movement Towards Socialism (MAS) party's strategies to expedite agreements with China for lithium exploitation without engaging in debates with critics.

Lack of transparency

Critics argue that the contract is unfavorable to Bolivia's interests and lacks transparency.

Opposition Deputy Juan José Torrez, a vocal critic of the lithium contracts, recounted the turmoil during the February 6 session of the Plural Economy Commission.

The debate was disrupted when groups both supporting and opposing the agreements stormed in, leading to confrontations. This chaos prompted a temporary suspension of the proceedings with no immediate plans to resume.

Later that evening around 8.00pm, opposition legislators were notified that the session would reconvene immediately. Upon returning, they found the doors locked and security personnel absent.

In their urgency, Torrez climbed over a door to grant access to his colleagues. Security forces intervened, attempting to prevent their entry, he told Entorno.

Once inside, they discovered that the vote to establish a quorum and proceed with the contract discussion was already underway. Despite their protests and calls to admit the remaining legislators outside, the session continued.

Ultimately, the agreement was approved in the early hours of February 7, with eight votes in favor, five against and one abstention.

QR code bribery

During the debate over the contract with the Chinese company, allegations emerged that some legislators, both from the opposition and the government, received bribes to vote in favor.

Opposition Deputy Renán Cabezas claimed that cash payments were made for favorable votes and that some legislators even used QR codes within the Congress hall to receive bank transfers.

Cabezas urged the Public Ministry to investigate these allegations in an interview with local media.

Torrez has characterized the agreements with Chinese mining companies for lithium extraction as a "betrayal of the Bolivian people." He argues that these contracts pose threats to both the environment and the national economy, favoring Chinese interests over Bolivia's.

He also expressed concern that the government might employ similar tactics to exclude opposition voices during the upcoming plenary discussions in the Chamber of Deputies and the Senate.

Torrez highlighted that the existing computerized voting system lacks transparency as it doesn't allow for individual verification of votes, thereby increasing the potential for fraud.

Water contamination

Despite the ongoing controversy, Torrez remains hopeful that the Senate will halt the final approval of the contract.

"It would be the only salvation for the people of Potosí and Bolivia. If we do not stop it, we would not be selling them lithium; we would be giving it away to the Chinese," he said.

Social groups in the Potosí department opposing the contract argue that the region will receive only 3% in royalties from the production value, a figure significantly lower than the 11% they had demanded.

The Potosinista Civic Committee (Comcipo) has expressed its opposition to the CBC contract for lithium exploitation in Potosí, where Salar de Uyuni is mostly located.

Agreements for lithium extraction will cause significant social, environmental and economic harm, benefiting only transnational corporations, Comcipo president Alberto Pérez told Entorno.

He voiced concerns about the environmental impact on Potosí's fragile water reserves, which are crucial for local communities and agriculture. He warned that intensive water usage in lithium extraction could deplete essential resources for the population.

"The environmental issue, especially water, is critical. There's limited fresh water, and it will dry up the wells. The lithium processing will lead to contamination," he emphasized.