President Boric Announces Plans For Nationalizing Chile’s Lithium Industry

To strengthen Chile’s economy and safeguard the environment, President Gabriel Boric confirmed on Thursday, April 20 that the country would nationalize its lithium business.

The Plan

SQM and Albemarle, two titans of the lithium business, would eventually cede ownership of Chile’s colossal lithium operations to a separate state-owned corporation as a result of the shocking decision of the country with one of the most extensive lithium deposits in the world.

SQM and Albemarle provide supplies to Tesla Inc, LG Energy, and other producers of electric vehicles (EVs) and batteries. SQM was formerly known as Sociedad Quimica Y Minera de Chile.

As per The Print, future lithium contracts would only be made through state-controlled public-private partnerships.

He stated that while the government would not cancel existing contracts, it hoped that firms would be receptive to state assistance before they ended. The existing contract with SQM is scheduled to end in 2030.

Establishing State-owned Companies

To establish a lithium corporation entirely owned by the state, Boric also said that he would start discussions with communities, businesses, and elected officials.

Congress would have to authorize the company to operate. In the second part of the year, Boric will offer the proposal to the legislature.

Many of Boric’s more ambitious initiatives have been restrained by Congress, which rejected an attempted tax reform measure in early March.

Boric stated that he had directed Corfo, the state development agency, to charge state-owned Codelco, the world’s largest copper producer, with determining the best pathways ahead for the government’s engagement in lithium production in the Atacama salt flats.

Thus, this policy is essential for setting the guidelines for developing the country’s large-scale lithium mining industry.

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