Blinken in Argentina: Eye on lithium Opinion

The next visit to Buenos Aires by Antony Blinken, Secretary of State for President Joe Biden, promises to strengthen the bond that the Democratic administration is exercising with the Argentine government, beyond ideological differences.

According to the Secretary of State’s statement, it is clear that, beyond the importance given to “democratic governance” and “human rights”, the focus of the visit will be on “promoting trade and investment”, and in particular, so-called “critical minerals”. “, whose growing demand is key to the new energy matrix.

In the production plan implemented globally, the dominant position is occupied by lithium, although there are other resources such as nickel, copper, titanium and cobalt that are fundamental for the manufacture of electric vehicles (the new symbol of consumption in the Northern countries), along with Also for the production of wind turbines and solar panels.

But the United States has serious reasons for concern because China is currently the undisputed leader in the global supply chain for critical minerals, representing about 60% of global production of “rare earth” materials.

Therefore, any shift toward low-carbon energy sources or toward a “green economy” (as the Biden administration prefers to call it) today is driven by Beijing’s potential for international influence and its enormous market power, which At least the region is better off than Washington intended, in a situation that will continue for many decades without being completely revised.

To balance the vast resources and authority exercised by China in the rare minerals sector, the United States has naturally partnered with the European Union, which, in turn, is waging its own trade war with Russia over these same resources. . Between the two partners, a new “Association Forum for Mineral Security” is being finalized, with undoubted international impact for the coming years.

Under these circumstances, it is necessary for the United States to establish a solid alliance with Argentina, even amid the ideological divide that remains between the Democratic government in the North and the alleged liberal mandate (in reality, a simple ultra-neoliberal regime). Overcoming differences too. Established in the south of the continent.

From Washington, priority (though not exclusive) interest in minerals of local origin focuses on lithium, a key resource for the manufacture of batteries for electric motors. In 2023, Argentina will extract approximately 33 thousand tons of carbonated lithium, becoming the world’s fourth largest producer after Australia, Chile and China.

Various forecasts ensure that by 2030, Argentina will become the third largest producer of lithium in the world and the main Latin American supplier, largely due to the high number of extraction projects in development fueled by a regulatory regime open to foreign investment.

The benefits of its exploitation include minimal royalties, as well as those of a provincial nature, and this particularly benefits the governorates of Catamarca, Salta and Jujuy, where the main lithium reserves are located.

Limited state supervision of the operations of foreign companies also serves as an incentive, where the brand new Arcadium Lithium stands out, with capital from the United States and Australia, and other corporations of the same origin such as Lake Resources, Lilac Solutions and Albemarle. , in addition to Canadian, British and Dutch companies.

However, today the lithium market in Argentina is dominated by resources of Chinese origin in seven enterprises, the leader of which is the company Jiangxi Ganfeng Lithium Company. While Argentine lithium exports are also mostly oriented towards China, a market that until 2021 was more diversified and led by the United States, has currently been reduced to a fourth-tier buyer.

Blinken’s visit to Buenos Aires comes in the wake of rising geopolitical tensions over lithium and other critical metals and is aimed at preserving Argentina as a privileged supplier to the United States and the main buyer of this new white gold and To displace China as an investor. Therefore, the negotiations will lead to a cooperation agreement for the supply of minerals, similar to a free trade agreement.

As can be seen from the Secretary of State’s statement, the contradiction marked by the White House in its relations with Brazil and Argentina is evident.

In Brasília, Blinken will be meeting with President Lula da Silva and the leadership of the PT government to, among other things, promote “global governance”, analyze cross-cutting issues such as the environmental crisis and sustainable development, and verify its impact. do. The political situation in Venezuela and its regional implications.

With Argentina, on the other hand, the proposed agenda would be very different, much more limited. As was also verified by the new negotiations with Ukraine and the resignation of the BRICS, this mission will focus on the provision of strategic resources to the main allies, starting with the United States and Great Britain, and on a new crusade against China. Against Russia, which may also have an impact at the regional level.