Lithium Diplomacy and the South American Triangle’s Critical Mineral Strategy

Background: The shared lithium reserves of Argentina, Bolivia, and Chile, collectively known as the Lithium Triangle, have attracted intensified international investment and diplomatic attention since 2022 amid global demand growth driven by electric vehicle production and energy transition policies. Aims/objectives: This research examines how the three states are coordinating or competing in critical mineral diplomacy with external powers, including China, the United States, and the European Union, regarding lithium extraction and processing partnerships. Method: A qualitative comparative policy analysis was conducted using national mining legislation, bilateral investment agreements, and interviews with energy policy officials from the three countries between 2023 and 2024. Results: Findings show significant divergence in national approaches, with Chile pursuing public-private partnership models, Bolivia emphasizing state control through nationalization, and Argentina adopting a more liberalized investment regime, complicating efforts toward a unified regional lithium cartel comparable to OPEC. External powers have exploited these divergent approaches through differentiated bilateral courtship strategies. Conclusion: The study concludes that fragmented national strategies have limited the Triangle's collective bargaining power despite substantial shared resource endowments. Greater policy harmonization and joint negotiating platforms are recommended to enhance regional leverage in critical mineral value chains amid intensifying global competition for battery resources. Without such coordination, individual states risk replicating historical patterns of resource dependency under a new energy paradigm.

Keywords: lithium diplomacy, critical minerals, Lithium Triangle, resource nationalism, energy transition