The trend towards nationalization of the lithium industry as a threat to Chinese companies operating in Argentina and Chile

Burakova Uliana Sergeevna ORCID: 0009-0003-6197-1935 Student; Faculty of Social Sciences and Mass Communications; Financial University under the Government of the Russian Federation 49/2 Leningradsky Ave., Moscow, 125167. BurakovaU03@gmail.com

Krechetov Arsenij Vasilyevich ORCID: 0009-0005-0743-5191 Student; Faculty of Social Sciences and Mass Communications; Financial University under the Government of the Russian Federation Verkhneye Otradnoe str., 1, Odintsovo, Moscow region, 143009, Russia krvasily2003@gmail.com

Introduction

In the 21st century, lithium has begun to play a huge role in the global economy. Its various alloys and compounds are used in various industries: automotive, aircraft, metallurgy, microelectronics, chemistry, nuclear energy and many others. This metal has gained the greatest popularity due to its large electrochemical potential, which makes lithium practically indispensable in the production of high-capacity batteries. According to S&P Global Commodity Insights forecasts from 2024 ^[1], the demand for lithium will grow by more than 2 times by 2027 and more than 3 times by 2030. By 2030, the world may need 3.2 million tons of lithium to meet growing needs, mainly from electric vehicle manufacturers, which 80% of the demand for this metal will be accounted for, while today this figure is 58% ^[2].

The main beneficiary from the use and distribution of lithium is the People's Republic of China. About 25-30% of new cars sold in the country are represented by electric vehicles and hybrid cars ^[3]. At the same time, 6 of the world's 10 largest electric vehicle manufacturers are Chinese. BYD Co Ltd, China's largest electric car manufacturer, together with the American company Tesla, control about a third of the global electrified car market, in particular, they sold 3.4 million electric and hybrid vehicles in 2023.

In addition, China has big plans for the development of renewable energy sources, in which lithium-ion batteries play a huge role. China accounts for 37.6% of the world's installed renewable energy (RES) capacity ^[4]. At the same time, China accounts for 63% of the renewable energy capacity commissioned in 2023. The presented facts point to the huge role that lithium plays for China's newly developing industries, as well as for the implementation of its plans to decarbonize its industry.

With China's total dominance in the country's lithium consumption structure, more than 50% of the world's total reserves of this metal fall into the so—called "lithium triangle" - Bolivia, Argentina and Chile. In this regard, the economic, political and legal conditions for access to lithium resources outside its national territory are of great importance to the PRC. A number of new trends have emerged in this area recently. The government of Bolivia, where 21% of the world's reserves of this metal are concentrated, in 2008 instructed the Bolivian Mining Corporation to create the National Management of Evaporative Resources (Gestión Nacional de Recursos Evaporativos, GNRE), whose area of responsibility included "industrialization of extraction of evaporative resources" ^[5]. In 2009, the Constitution of Bolivia was amended, according to which lithium was declared a strategic resource ^[6]. This means that the exploration and production of this metal has become under the full control of the government of Bolivia, in fact, the country has nationalized this industry. The result of this was the creation on April 27, 2017 of a national strategic public company — Lithium Deposits of Bolivia (Yacimientos de Litio Bolivianos, YLB), which began to control the entire lithium production chain ^[7].

However, Bolivia is not the only country where the activities of international lithium mining companies are under threat. In particular, in 2023, Chilean President Gabriel Boric announced plans to nationalize the lithium industry. Although these plans have not yet been implemented, the general trend in the countries of the lithium triangle leaves no doubt that countries interested in uninterrupted supplies of this metal for the implementation of their ambitious projects, such as China, should review their strategies and assess all the risks of possible nationalization of the lithium industry in Chile and Argentina.

Chinese lithium companies in Argentina and Chile

For a long period of time, most of the lithium production, mining, processing and transportation were in the hands of the so-called "big three": the American company Albemarle, the Chilean Sociedad Quimica y Minera de Chile (SQM), as well as the Arcadium Lithium Corporation, formed as a result of the merger of the American company Livent Corporation and the Australian Allkem Limited. Nevertheless, Chinese lithium companies continue to take root in the Latin American lithium market, implementing lithium mining projects both from scratch and through the purchase of shares in existing companies.

According to a report released in January 2024 by the US Geological Survey, Argentina has the largest lithium reserves in the world after Bolivia – 22 million tons ^{[8, p. 111]}. Currently, there are 5 largest lithium mining companies in Argentina, one of which is Chinese, namely Ganfeng Lithium. The company controls about 122,432 hectares of salt marshes in the provinces of Salta and Jujuy ^[9]. Also in 2023, a lithium mine was commissioned in the area of Lake Cauchiri Olaros ^[10], owned by Exar, of which Ganfeng Lithium is a shareholder, and from where, according to the contract, about 40,000 tons of lithium per year will be shipped to China.

In addition to Ganfeng Lithium, Tibet Summit Resources is actively operating in Argentina, which in 2023 announced that it would invest $1.7 billion in two of its new lithium projects^[12]. In addition, Tibet Summit Resources already owns the Angels Lithium Salt Lake lithium plant, which has received investments of $717 million ^[12].

As for Chile, two companies control most of the lithium production here – Chilean Sociedad Quimica y Minera de Chile (SQM) and American Albemarle, whose licenses for the development of deposits expire in 2030 and 2043, respectively. Nevertheless, back in 2018, the Chinese company Sichuan Tianqi Lithium acquired a 23.77% stake in the Chilean lithium giant SQM ^[13]. The SQM mining company holds a special place in the political history of Chile. More than fifty years ago, it was established as a mixed private-state company and was privatized during the military dictatorship of Augusto Pinochet (1973-1990). A relative of the former Chilean dictator is currently on the board of directors. In addition, in 2015, the company was accused of corruption for illegally financing candidates and political parties opposed to then-President Michelle Bachelet (2006-2010; 2014-2018).

The Chinese business not only mines lithium in Latin American countries, but also owns stakes in large-scale lithium processing projects, which allows it to control a significant part of the global market.

Threat of nationalization

The global electric vehicle market continues to grow. It grew by 29.7% in 2023 and by 37% in 2022 ^[14], driven by the growing demand for cleaner energy solutions. China, as the world's largest producer of electric vehicles, is in great need of lithium, an essential component in the production of batteries for electric vehicles. For obvious reasons, countries like Argentina and Bolivia attract Chinese investors and mining companies. Nevertheless, a new wave of resource nationalism is gaining popularity in Latin American countries today.

Unlike Bolivia, the lithium industry in Chile and Argentina has not yet been nationalized. Nevertheless, in April 2023, Chilean President Gabriel Borich announced the country's national strategy, which provides for the development of the Chilean lithium industry with the participation of the state throughout the production cycle, as well as scientific and technical development to create added value within the country. Moreover, the president announced the creation of the National Lithium Company (Empresa Nacional del Litio).

The Borich government argues for the need for state participation in the lithium industry by saying that lithium is a national treasure and the country should control its production. To implement the plan, the government has commissioned two state-owned mining companies, Enami and Codelco, to negotiate a public–private partnership with market players, in this case two giants, SQM and Albemarle. However, neither Enami nor Codelco have experience working with lithium, their main activity is related to copper mining. As a result, government control over lithium projects, especially the development of promising salt marshes, may be less effective than originally planned.

Moreover, it should be noted that the creation of a state-owned lithium company before the end of Gabriel Boric's presidency seems unrealistic, since the next presidential elections in the country will be held in November 2025, and the process of creating such a company requires the approval of Congress, which has already, for example, blocked the tax reform, which is one of the central ones in the president's program. In addition, the opposition has a negative attitude towards this idea. Some right-wing MPs even propose to transfer lithium deposits to a concession, as is already the practice in other countries, with a royalty system that guarantees the state a fair profit without direct participation as a shareholder. This is exactly the system currently operating for Albemarle and SQM, which in 2022 paid more than $5 billion to the treasury of Chile. in the form of royalties ^[15].

It should be noted that despite the fact that the Chilean government stubbornly avoids the term "nationalization" in its statements, many media ^[16] prefer to use this word, calling to mind such political figures as Fidel Castro (1959-2008) in Cuba, Evo Morales (2006-2019) in Bolivia and Hugo Chavez (1999-2013). in Venezuela, who initiated the transfer of private companies to the state with little or no compensation.

Although Chilean Mining Minister Marcela Hernando clarified in an interview with Bloomberg that the National Lithium Strategy proposed by the presidential government was not a "nationalization"^[17], Gabriel Boric's statement caused a negative reaction on the stock market – Albemarle shares on the New York stock Exchange fell by 5.27%, and SQM — by 2.6% ^[18].

However, Gabriel Borich's plan includes a "peaceful divorce", he seeks the voluntary consent of large companies to transfer the rights to develop lithium deposits to a state-owned company. The percentage of shares can vary from 51 to 49 in favor of a state-owned company to 60 to 40. Nevertheless, this is exactly what can scare off investors and foreign companies who decide that this country is less attractive for investments and reorient their investment strategies to other countries. For example, in 2023, ALB announced plans to purchase the Australian lithium producer Liontown Resources ^[19], and SQM is already developing a lithium project together with a local company in Australia. Thus, Chile must balance national interests in the face of growing competition in the global critical metals sector.

The idea of nationalizing the lithium industry very quickly crossed the border of Chile's neighboring state, Argentina, which is actively developing its lithium industry and is one of the leaders in lithium reserves in the world (second place), which attracts investors. In three years, from 2020 to 2023, investments in the lithium industry in Argentina amounted to about $ 5 billion ^[20].

Nevertheless, a month after Borich presented his national strategy, deputies of the Argentine parliament from the Frente de Todos (FdT) party presented a draft for the nationalization of lithium in their country. According to their statement, "mineral reserves containing lithium are a strategic natural resource for the socio-economic and industrial development of the Argentine Republic" ^[21].

The bill also establishes that all previously granted lithium exploration and production concessions to private companies will be fully covered by the new law and will have to comply with its provisions and rules ^[22].

The Argentine business sector, represented by the Argentine Chamber of Mining Entrepreneurs (Cámara de empresarios mineros de Argentina, CAEM), the Argentine Industrial Union (Unión Industrial Argentina, UIA) and the Argentine Chamber of Construction (Cámara Argentina de la Construcción, Camarco), opposed this initiative.

During the international mining exhibition - ArMinera 2023, organized by CAEM, Vice-President of the Chamber Franco Mignacco criticized the bill, saying that the lithium industry has made a significant contribution to the development of the country's economy, especially in regions where investments and development of human potential, infrastructure, etc. are needed. The industry has already become one of the key investment drivers in the country. However, the new bill could jeopardize all these achievements. It directly affects the development of the industry and can slow down its progress ^[23]. As a result, the Mining Council trade association (Consejo Minero, CM), which unites the largest mining companies in Chile, rejected the project and questioned the initiatives presented in the congress.

Today, according to Jose Alioto, External Relations manager at the Argentine company Allkem, the legislation in Argentina is one of the most favorable for foreign investors, which allows them to invest money in expensive and long–term projects. For example, while in Argentina there is a royalty ceiling of 3%, in Chile the royalty varies from 6.8% to 40% depending on the various mineral compounds ^[24].

According to Hong Kong's oldest newspaper, SCMP, Argentina and Brazil are considered "safe" countries for Chinese investors because their governments are more receptive to foreign investment and have adopted liberalized mining policies that promote international partnerships. For example, in March 2024, Ganfeng acquired a stake in an Argentine lithium brine production project for $70 million, which demonstrates its long-term commitment to the region ^[25].

It should be noted that the nationalization of the lithium industry can strengthen relations with other countries, including China. This is evidenced by the successful experience of Bolivia. For example, in April 2021, the Bolivian state-owned company Yacimientos de Litio Bolivianos signed a contract with the Chinese company Ganfeng Lithium for the supply of lithium carbonate. It is noted that China is also extremely interested in projects to improve the road infrastructure of Bolivia, to build large steel mills and enterprises for the production of lithium carbonate. According to official information from the Chinese side, before the outbreak of the pandemic, more than 60 Chinese companies operated in Bolivia, and 55 joint projects were launched with the Bolivian authorities. More than 2 thousand Chinese specialists worked in the economy of the Latin American republic ^[26].

At the same time, it should be noted that the nationalization of the lithium industry in the lithium triangle countries may become an additional incentive to create the so—called "lithium OPEC", an organization that will unite lithium exporting countries in Latin America.

The possibilities of China's economic pressure on Argentina and Chile

Argentina's economic dependence on China is evident in many aspects. For many years, China has been one of Argentina's main trading partners. It also ranks first among the countries with which Argentina has the largest trade deficit. In 2022, this figure was $8 billion, in 2023 – $8.4 billion, and in the first quarter of 2024 - $1.1 billion ^[27]. In addition, China is one of the leaders in both Argentina's exports and imports (Figures 1 and 2). At the same time, the main items of exported goods are represented by various food products, beverages and tobacco, animal or vegetable fats and oils, as well as other types of agricultural products ^[28]. At the same time, Argentina mainly imports machinery, tools and various electrical appliances, as well as vehicles and mineral fuels, including oil.

Fig. 1. Main export directions of Argentina in 2023 (%)

Source: Built by the authors on the basis of statistical data ^[28]

Fig. 2. The main directions of Argentina's imports in 2023 (%)

Source: Built by the authors on the basis of statistical data ^[28]

If pressure is needed on Buenos Aires to defend its interests, Beijing can create serious problems for Argentina. This threat takes on even more weight when we consider that the economy of this Latin American country has been experiencing huge problems in recent years, such as rapidly increasing inflation (for 9 months of 2024, accumulated inflation was almost 95%)^[29], explosive price growth in (211.4% by the end of 2023)^[30], as well as the devaluation of the national currency (800 pesos per 1 dollar by the end of 2023)^[31].

Fig. 3. Main export directions of the Republic of Chile in 2023 (%)

Source: Built by the authors on the basis of statistical data ^[28]

Fig. 4. Main import directions of the Republic of Chile in 2023 (%)

Source: Built by the authors on the basis of statistical data ^[28]

The Republic of Chile has some similar trends to Argentina in the growing dependence of the economy on China. According to the data for 2023, China ranks first in the list of the country's main exporters and importers (Figures 3 and 4). At the same time, the share occupied by Beijing is quite impressive — 39% of exports and 23% of imports of Chile ^[28]. Half of the goods exported from Chile are ores, slag and ash, as well as copper and products made from it, while the main imports are mineral fuels, machinery and mechanical devices, as well as various technical equipment. At the same time, Chile, unlike Argentina, has a free trade agreement with China ^[32], which worsens the situation, since in conditions of free competition, Chilean producers will not be able to compete on equal terms with Chinese giants, which pose a threat even to the United States. The main economic problem of the republic is dependence on copper and lithium prices, which creates the possibility for China to use this fact to influence Chile, but it is not profitable for Beijing to bring down a very promising market for it in order to put pressure on one country. Moreover, countries such as Australia, which are among the leaders in the extraction of various groups of rare earth metals (REM), including lithium, can take advantage of China's actions to strengthen its position if it decides to take radical action in the REM market. Chile's economy is also characterized by greater stability in comparison with Argentina. Thus, since the early 1990s, Chile's GDP has continued to grow ^[28]. At the same time, over the past 10 years, this indicator has been quite stable compared to other countries in South America. In addition, Chile has maintained a good position in the index of economic freedoms for the past 25 years ^[33], which gives it an additional advantage in reducing China's influence on the country's economy. However, the threat of pressure from Beijing still remains, and it can be assumed that it will find ways to influence the decisions of this Latin American country by resorting to more subtle economic moves regarding the imposition of duties and restrictions on trade with Chile.

Debt collection is another opportunity for China to exert pressure on decision-making in other countries. Over 13 years (from 2008 to 2021), China has provided loans of $240 billion to 22 developing countries with heavy debt burdens, sharply increasing lending since 2016 ($104 billion)^[34]. At the same time, almost 80% of loans issued from 2016 to 2023 were received by low- and middle-income countries, including Pakistan, Mongolia and Argentina. The high debt burden was among other reasons for Argentina's default announced in 2020, the seventh in a row since 1951 ^[35].

For 2024, the volume of Buenos Aires' debt obligations to China has decreased, but there is no reason to say that this trend will continue. This is also indicated by the fact that, according to the World Bank, Argentina is among the top 20 countries in terms of debt to China with an indicator of 2.9 billion US dollars ^[36]. However, this figure is quite low compared to other Latin American countries, such as Brazil (3.4 billion US dollars) and Ecuador (4.1 billion US dollars). In addition, the size of Argentina's debt obligations to Beijing on the eve of default in 2020 was several dozen times higher than the above figures - 111.8 billion US dollars.

Compared to its eastern neighbor, Chile faces a much lower risk of default due to debt obligations to China. The national debt of the Republic of Chile has steadily increased over the past 15 years, reaching a historic maximum for the country of 46.1% of GDP in 2023 ^[28]. However, it is not among the most heavily indebted countries from China, although according to the data presented above, its trade turnover with China is significantly larger than that of Argentina, which in turn has much larger debt obligations to Beijing. However, in recent years, Beijing has begun to lose ground in the region to both multinational organizations and the United States. In particular, political uncertainty in Argentina has had a deterrent effect on Chinese lending to that country over the past few years, and tensions have increased since Libertarian President Javier Miley came to power in November 2023. His policy of comprehensively strengthening relations with the United States has paralyzed the allocation of funds for the completion of some infrastructure projects that were implemented by Chinese companies. Even before Miley's election, the Export-Import Bank (Eximbank) China conducted intensive negotiations on new loans with the previous government of Alberto Fernandez. The latter insisted on full financing by the Chinese side of the Atucha III nuclear power plant construction project, which would include Chinese nuclear reactors ^[37]. However, China's attempts to strengthen its position in the nuclear energy market in Latin America have also failed.

International financial organizations are also not going to give the Latin American market to China. Just a decade ago, China's loans in the region exceeded those provided by the World Bank (WB) and the Inter-American Development Bank (IADB). But due to the many factors limiting Chinese investment in South American countries, as well as the changing national interests of countries and the increased involvement of the World Bank and the IADB in the region after the Covid-19 pandemic, the situation has become exactly the opposite. In this regard, the financial injections of Chinese banks into Latin American countries began to decline sharply. Multilateral development banks are also active in the infrastructure sectors, where Chinese financial development institutions have previously expanded their activities. An example is the large amount of funding allocated by the IADB to Mexico, Brazil and Argentina for road improvements in 2023. (in the amount of 600 million, 480 million and 345 million dollars. respectively) ^[38].

Of course, trade turnover and loans provided are important indicators reflecting the degree of China's influence on Latin American countries. However, in addition to this, Beijing uses other mechanisms, in particular, an active investment policy and the implementation of infrastructure projects in the region. This strategy provides China with an additional lever of influence on the economic and political development of Latin American countries. In recent years, the volume of Chinese investments in Argentina has increased significantly and has become more diverse.

Despite the fact that the mining industry (gold, copper) remains an important sector for Chinese investors, in recent years the focus has shifted to renewable energy sources, especially solar energy ^[39]. China is the leading supplier of solar panels to the region, and major projects such as the Cauchari Solar Park have been funded by Chinese banks and implemented by Chinese contractors ^[40]. There is also an increase in Chinese investment in the lithium sector, confirmed by Ganfeng's purchase of Lithea in 2022 to implement a project to develop and operate the promising Pozuelos-Pastos Grandes lithium deposit in Argentina ^[41]. However, Argentina is not a leader in attracting Chinese investment in the region, which highlights the competition with other countries for Chinese capital.

The situation in Chile is similar, but it differs on a much larger scale. The country has been a major destination for Chinese investors in recent years ^[42]. The key industries for Chinese investors are mining and energy, which account for more than 90% of foreign direct investment from China. The acquisition by Tianqi Lithium of almost 24% of the shares of SQM, the world's leading lithium producer, underscores the importance of Chile for realizing Chinese ambitions in the field of electric vehicles and batteries^[43]. In addition, China is also investing in agriculture, especially wine production, as well as in Chile's transportation infrastructure. It is also worth mentioning that the Chinese company Huawei operates data centers in Chile, which expands the Chinese influence on the IT infrastructure in the country ^[44]. Such a comprehensive penetration of Chinese companies into the key industries of Argentina and Chile could threaten the economies of these countries if they take actions affecting Chinese interests in the region. This fact underscores the need to exercise caution and regulate the activities of Chinese companies in the strategic areas of Chile and Argentina in order to ensure national security and protect their interests.

The position of the United States and its allies

Nevertheless, in terms of the total volume of foreign direct investment in Chile, China is significantly inferior to Canada and the United States ^[45]. In Chile, each of these countries accounts for almost twice as much total foreign direct investment as China. In 2023, the joint share of FDI in Chile from Canada and the United States was 24.1%, with the largest share of 26% recorded in the mining sector, which indicates the great interest of the United States and Canada in the mining industry of Chile ^[46]. According to the U.S. Embassy in Chile, the United States is currently the main export destination for small and medium-sized companies in Chile. According to InvestChile, the Chilean government agency responsible for attracting investments to the country, in 2023, the United States implemented 50 different energy initiatives in Chile, investing about $6.4 billion in this industry ^[47]. In addition to the energy and traditional mining sectors, where American companies are firmly established, American firms are pushing innovation in sectors such as telecommunications, technology, and logistics.

The situation is similar with Argentina. On August 22, 2024, the United States and Argentina signed a memorandum of understanding aimed at increasing investments in the mining industry ^[48]. The main mining projects funded by the United States are: the project for the exploitation of deposits in the Argentine part of the Puna ecoregion (silver, lead and zinc), the Salar de Arizoro project (lithium), the El Kevar project (silver), the Fenix project (lithium), the Kachi project (lithium), the Cerro Negro project (gold). In addition, about 300 American companies do business in Argentina ^[49], some of which have been in existence for more than a century. Accordingly, they have a certain weight in making decisions affecting business in the country. At the same time, the United States is the largest investor in Argentina, in 2023 the United States accounted for 18.7% of all foreign direct investment in the country ^[50], the main areas of investment were production and mining. This indicates the strong interest of the United States in what decisions Argentina is making in these sectors, including lithium mining.

Thus, it can be argued that the United States is firmly rooted in the economies of Chile and Argentina. At the same time, their interest is based on the extractive industries of Latin American countries. Accordingly, large-scale nationalization of the lithium industry would directly affect Washington's interests in the region.

The official position of the United States regarding the nationalization of the lithium industry in Chile and Argentina is not clear and consistent. Washington's strategy can be described as follows: The United States does not intend to put pressure on local governments, in particular the government of Chile, in order to freeze the nationalization of the lithium industry in the country for as long as possible. On the contrary, American companies have chosen the path not of confrontation with the authorities, but of creating the most favorable conditions for themselves during the nationalization process. Such intentions were confirmed at a meeting between representatives of the Chilean State Development Authority Corfo and the American mining company Albemarle ^[51]. The parties previously agreed that mining would be carried out by an American company under lease agreements, while Corfo would act as the owner of the mining facilities.

The geopolitical events taking place in the last few years, related to the conflict in Ukraine and the increasing tension in the Taiwan Strait, distract the main attention of the United States and the EU, which at this stage do not have the resources to wage a price war in the lithium market. In addition, any problems experienced by international companies in the lithium triangle increase the investment attractiveness of another important player in the market — Australia and its deposits, since 52% of the world's lithium comes from this country ^[52] and its revenues from exports of this commodity are expected to reach more than 19 billion ^[53] Australian dollars by 2028 At the same time, the United States and Australia are extremely interested in significantly weakening China economically and creating problems for its export industry, in which lithium plays a major role. Accordingly, Latin American countries are unlikely to experience pressure from the above-mentioned temporary rivals of the PRC in implementing nationalization plans, which may have an ambiguous impact on the activities of Chinese companies.

Conclusion

Today, lithium is considered a critically important resource. Almost 60% of its reserves are concentrated in an area covering parts of Argentina, Chile and Bolivia, known as the "lithium triangle". The People's Republic of China is striving to maximize its influence on the global market of this metal by expanding the activities of its mining companies in foreign countries and acquiring shares in national companies. However, recently there have been trends towards the nationalization of the lithium industry in Chile and Argentina, which has created certain threats to Chinese interests. Although Bolivia has managed to implement its plans for nationalization, in Chile and Argentina such initiatives have met with resistance from both business associations and opposition forces in the representative bodies of the countries. This situation does not allow us to speak about the unambiguity of the scenario of nationalization of the lithium industry in these countries. One of the possible reasons for the existence of political forces in the countries that question the need to nationalize the lithium industry is the comprehensive economic pressure that China can exert on Argentina and Chile. Beijing's influence is due to its incredibly deep penetration into the economies of these countries, due to the dominance in the structure of imports and exports of Argentina and Chile, the presence in these countries of a huge number of investment projects in all strategic areas of their economies, as well as the expanding volume of loans provided to these countries. For example, according to the Argentine government, between 2020 and 2023, Chinese companies invested $3.2 billion in mining projects, including seven lithium projects, which is almost twice as much as American firms that supported only three lithium projects ^[54]. Moreover, the Chinese investment has fully paid off. Thus, in 2023, 43% of lithium exports from Argentina went to China, and 11% to the United States^[55].

However, the election of Javier Miley as president marked a shift in Argentina's foreign policy from developing close ties with China to closer ties with the United States. So, during a visit to Argentina in February 2024, Secretary of State Anthony Blinken stated that the United States sees an "extraordinary investment opportunity"^[56] in the country, calling lithium a key area for American investment. Moreover, American entrepreneur Elon Musk, who seeks to ensure the supply of lithium for the production of batteries for his electric vehicles, publicly supports the president in his publications on the social network X. The US government continues to express concern about China's activities in their "backyard." In her speech to the Atlantic Council, General Laura Richardson, the senior representative of the US army in South and Central America, noted the US desire to increase investment in lithium in the region. Her words were made against the background of "strategic competition" with China, and she stressed the need to "oust competitors" from this market^[57].

At the same time, China continues to expand its lithium investment portfolio in projects across the country and beyond (in Chile and Bolivia), strengthening its position as a key trading and financial partner.

The prospects for the nationalization of the lithium industry in Argentina and Chile remain ambiguous. On the one hand, nationalization can scare away foreign investors and negate the process of attracting the necessary investments. On the other hand, nationalization may be a response to the strengthening of Chinese influence in the field of lithium mining, which will trigger the creation of a platform for coordinating the policies of lithium exporting countries. Such an alliance could strengthen Latin American countries' position in the global lithium market and allow them to control prices and export volumes. Thus, the final result of nationalization will depend both on the current international situation and on the degree of preparation of the economies of Argentina and Chile for such radical changes.