Bolivia's Economic Upheaval Threatens Renewable Energy Development

• Published date: 21 September 2023
• Subject Matter: Energy and Natural Resources, Energy Law, Oil, Gas & Electricity, Renewables
• Law Firm: Flaster Greenberg PC
• Author: Daniel B. Markind

Just four months after agreeing to give a Chinese consortium led by the lithium-ion battery manufacturer, Contemporary Amperex Technology, control over the development of Bolivia's lithium deposits (Source), Bolivia's economy is undergoing a severe crisis.

For 15 years after the 2006 inauguration of Evo Morales, Bolivia's first indigenous President, the Bolivian economy boomed. Fueled by enormous wealth from the export of high-priced natural resources and agricultural products, Bolivia enjoyed an enormous increase in its standard of living over a short period of time. That came to an abrupt end, however, in 2014 when commodity prices crashed. Thanks to its enormous financial reserves generated during good times, Bolivia managed to hold off the day of reckoning for a few years but, buffeted further by COVID-19, the economic miracle came to an end a few years back. Fearing the inefficiency of state control over the country's wealth, Bolivians rushed to convert their liras into American dollars. Now, those dollars have all but run out. With no trust in the local currency, Bolivia's economy could go into free fall at any moment. Should that happen, social...