report

Mining in Bolivia Lithium rush in the Andes

As of: 06/20/2021 4:40 p.m.

The largest lithium deposits on earth are believed to be under the Uyuni salt lake in Bolivia. The planned dismantling of the metal, which is important for batteries, raises hopes, but is controversial because of the high water consumption.

By Anne Herrberg, ARD Studio Buenos Aires, and Matthias Ebert, ARD studio Rio de Janeiro

It lies dazzling white between the majestic peaks of the Bolivian Andes, an area nine times the size of Berlin: the Uyuni salt lake. Hidden underneath is a treasure: white gold, lithium, or as Panfilo Huayllas, Mayor of Rio Grande says: “our future”. He demands: “All communities around the salt lake and all Bolivians must benefit from the lithium that is under this salt crust.

Lithium, the lightest metal on earth, is required for lithium-ion batteries. They are not only found in cell phones and laptops, but also in electric cars. Without lithium there is no e-mobility – and nowhere in the world are more reserves believed than here, on the roof of the Andes.

Bolivia doesn’t just want to be a supplier of raw materials

But Bolivia wants to be more than just a supplier of raw materials. “We local residents have to share in the profits, because we will feel the effects of lithium industrialization here in Rio Grande,” says Mayor Huayllas.

Lithium is said to be a driver for Bolivia’s industrialization. The plan is to build the batteries yourself. Ex-President Evo Morales was once looking for partners for this project – and found them in a German medium-sized company: ACISA from Zimmer ob Rottweil on the edge of the Black Forest. It was a deal of the century. But it burst in 2019 , after the election overshadowed by allegations of fraud and Morales’ flight into exile. Since then, the German-Bolivian project has been on hold.

The lithium deal negotiated by ex-President Morales collapsed in 2019. Image: AFP

Not everyone is enthusiastic about it anyway. Luis Machaca is the spokesman for a citizens’ initiative that opposes the project. “The Germans wanted to mine our raw material behind our backs, with a contract for 70 years,” he says. “They may be a good partner, but they have neither the technical means nor the technology.”

Lithium mining uses up a lot of precious water

What does mining mean for people, but also for the sensitive ecosystem? It is about the most precious commodity on the roof of the Andes: water.

A look across the border into the Atacama Desert to Chile: SQM has been mining lithium there for 25 years. The brine is pumped up from 40 meters, then evaporates in basins over months until a lithium-containing slag remains. It is a very water-intensive process, of all places in one of the driest regions in the world, says the Chilean biologist Cristina Dorador. “We can see from satellite images over the past 20 years that the soil has lost moisture,” she says. At the same time, the ground is heating up and the vegetation is receding. “These changes are directly related to lithium production over the past 20 years.”

Water protection should be improved

The company promises to make mining more sustainable. In Chile’s new constitution, on which the biologist Dorador will also be co-writing, environmental and water protection should be a top priority. Local residents like Cristian Toroca remain skeptical. “The company had not previously intended to involve local residents, that bothers us about this group,” he says. “They’re pulling this mineral out of the ground to sell in Europe as a clean product, but that’s a lie.”

In Bolivia it is still unclear who will be awarded the contract: the Germans are competing with Chinese and US companies. Panfilo Huayllas continues to hope that the white gold will bring prosperity to his community. But he too says: not at any price. “Alternative ways of supplying lithium production with water in the future must be found. If they only tap our wells, we will ruin the future of our children.”

In the past few years, if you want to talk to the bank manager that the interest must be a large deposit certificate, your deposit must be more than 300,000 yuan, but now it has changed. Many banks have adjusted this situation and reduced it. Starting from June 2015, the central bank has issued a threshold of 300,000 yuan for personal deposits and 10 million yuan for corporate deposits. In June 2016, the central bank changed the threshold for personal deposits to 200,000 yuan, which is appropriate. Mediation, but the two are inseparable, and the amount of profit enjoyed is still based on the principle of multiple deposits.

Then why is the bank so good and will give you such a high interest rate? In fact, from the perspective of the bank, the increase in deposits also means the expansion of the bank’s scale and the increase of profits. In this way, a cycle is formed, and the certificate of deposit with a larger amount becomes a very important business of the bank.

In order to attract more customers to deposit money in banks, many banks are also making various “big losses”. Some banks have adjusted the interest rate of large deposit certificates to 30%, and some even reached 50%-60%. However, it is estimated that such a large gain is unrealistic without depositing it in the bank for decades. Therefore, in order to realize the real “money making money”, one must look at the large deposit certificate. You can look at a few more banks, and then compare it with The bank manager negotiates how to achieve the highest interest rate.

However, someone inside the bank revealed that if the interest rate is relatively low, you can negotiate the highest interest rate with the bank, or you can go to some small banks. They usually require deposits to settle in, and then give you a higher interest rate return. In this case, If we have 200,000 spare cash in our hands, why should we choose large deposits instead of fixed deposits?

The first reason is that the interest rate of large deposits is very high. In the same bank, the interest rate of large deposit certificates is definitely higher than the interest rate of fixed deposits. According to the standards of relevant departments, the highest rate of increase of ordinary fixed deposits is basically 30%. However, the highest interest rate for large deposit certificates is around 50%, so the gap is not small.

The second reason is that large deposit certificates can be transferred, and interest can be recorded and calculated. We all know that if there is a sudden need for money during the deposit period, then all interest will be lost, but the large deposit certificate will not. If you need money urgently, you can transfer the deposit certificate to others at a low price. The last two people can also win.

Even if you don’t want to resell, you can still enjoy deposit interest. Ordinary time deposits take a long time to get the interest, but if you have a large deposit certificate in your hand, even if you are not full, you can still get the corresponding part. For example, if you deposit for 2 years, but you still have 2 Within months, the interest on fixed deposits will cease to exist. However, a large deposit certificate can be charged for one and a half years of interest, and it can also be received. I have to say that this design is very user-friendly.

Everyone knows the last type of deposit. Nowadays, banks have six options for fixed deposits: three months, six months, one year, two years, three years, and five years. The certificate of deposit is increased according to these three types: one month, nine months and eighteen months. On the surface, there is basically no change. In fact, it has brought us more intangible benefits, so we must choose the correct method and amount of deposit! If you have 200,000 spare cash, which deposit method would you choose? What is your different view on this?