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They warn that Javier Milei wants to foreignize lithium and propose the creation of a federal company


After announcing extensive deregulation of the State through a DNU, the government of Javier Milei is preparing to continue with its plan to reform Argentine economic activity. He lithium, fundamental mineral for the energy transition, occupies a central place on the government agenda but, far from considering them a local strategic asset, warn that the Government is preparing to change the legal framework with the aim of promote their foreignization. They propose creating the Argentine Federal Lithium Company.

Days ago, Milei revealed that the tycoon Elon Musk “he is extremely interested in lithium” like “the United States government and many companies” North Americans and clarified, in this sense, that Argentina “needs a legal framework that respects the right to property.” Currently, lithium carbonate (LCE) is the essential raw material for the batteries of Tesla’s electric vehicles, the automaker owned by billionaire businessman Musk.

The words of the Argentine president move in the direction of a possible global opening of natural resources and a foreignization of the mineral, to the detriment of the provinces – such as Catamarca and Jujuy – that seek to develop it, and leave national production in the background.

Alejandro “Topo” Rodríguezdirector of Federal Consensus Institute and former deputy of the Nation, He referred to the importance of lithium in a context like the current one, where electromobility and new technologies based on said mineral are a priority. In this regard, he questioned the president’s position: “President Milei has already defined the priorities in this matter. He wants Argentina to change its legal frameworks so that foreign companies and entrepreneurs, especially Elon Musk, advance in the Argentine lithium business. That is his policy.”

Rodríguez described as “striking” the concern of Milei by the local legal framework, being that “Foreign companies have been investing in lithium in northern Argentina for some time now and some of them – North American included – are in the production phase, have begun to market and could increase their investments.

Currently, Argentina occupies the fourth global position in the ranking of world lithium producers. The director of the ICF explained that today “three projects operate here in the production phase, with national and foreign companies: from the United States (Livent) and from Australia (Alikem), in addition to an Argentine company in which a company has shares Canadian and one China”.

The director of the Federal Consensus Institute delved into the reality of the sector by highlighting that currently there are about 35 projects that already have planned investments and are on their way to starting the production phase. “Even the Inter-American Development Bank (IDB) has gotten involved. Through BIDInvest, A lithium project in Catamarca, called “Sal de Vida”, is already being financed. But Milei and the libertarians prefer not to register that reality,” he said.

According to his opinion, in the Government “They are embarked on a broader project, which involves granting targeted business guarantees in different areas of Argentine economic and commercial activity. It is not “the market”, by the way, that is the organizer of these decisions.”

They propose creating the Argentine Federal Lithium Company

For Rodríguez, Milei “will try to exert pressure to open the way to the businesses that he has already announced” and warned that in the case of lithium “What is decided and executed in the next two years can mark the destiny of that Argentine resource,” which is property of the provinces.

Given this panorama, he proposed the creation of a state company made up of the provinces to counteract the advance of foreignization plans by La Libertad Avanza. Although there is currently YPF Lithium, Rodriguez warned that the plans of the libertarians are “sink her”, Therefore, he considered as an alternative that “several Argentine provinces, owners of lithium, could associate to constitute a state company. The Argentine federal lithium company“, said.

The director of the Federal Consensus Institute recalled that “in our country, two provincial state lithium companies exist and operate: Jujuy Energía y Minería Sociedad del Estado (JEMSE), and Catamarca Minera y Energética Sociedad del Estado (CAMYEN)”, which ” “They could associate with EMSE, from La Rioja (Energía y Minería Sociedad del Estado), and with REMSa SA from Salta (Recursos Energético y Mineros de Salta, SA), with majority state capital.”

“The idea is not new or original. India, Saudi Arabia, Turkey and Russia are some of the countries that have state lithium companies. Bolivia also has its state company, Yacimientos de Litio Bolivianos (YTB), created in 2017 under the dependence of the Ministry of Energy. Mexico has LitioMx (Lithium for Mexico), a state organization created two years ago for the exploration and exploitation of Mexican lithium. In Chile, plans are already underway for the state-owned CODELCO (specialized in copper) and the National Mining Company (ENAMI), expand their activities more strongly towards the lithium sector,” he noted regarding the global panorama.

Why create a federal lithium company in Argentina?

Rodriguez considered that the creation of a federal lithium company, made up of the producing provinces, would allow “neutralize or put limits on a primary public delivery policy” by the national government.

Among the benefits that could be generated by the constitution of a new company, noted that it would allow “define a productive integration strategy with the value chain” with which “if we could not reach the comprehensive production of batteries, at least advance until we connect with the manufacturing of some of its components.”

Furthermore, it would enable the possibility of “deciding associate with private, national or foreign capital“, but selecting “in a demanding manner which investment projects to participate in”, something that some provinces are currently already doing.

In turn, it would allow the company to “open its own share capital to the private sector, national or foreign“, but always ensuring a minimum of 51% provincial state participation, he said.

“The Argentine provinces are the owners of lithium. Our country has more than 20% of the reserves of that mineral. That development potential cannot be given to the crude and old proposal of the libertarian liberals. There is a rational alternative with strategic sense , modern, efficient and profitable, both in economic, social and environmental terms. The Argentine Federal Lithium Company”, concluded Rodríguez.





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