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© Reuters. FILE PHOTO: A view of a brine pool of a lithium mine on the Atacama salt flat in the Atacama desert, Chile, August 16, 2018. REUTERS/Ivan Alvarado/File Photo
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SANTIAGO (Reuters) – Chilean President Gabriel Boric said on Thursday he would nationalize the country’s lithium industry and create a separate state-owned company to produce the metal used to make electric vehicle batteries.
Boric said future lithium contracts would only be issued as public-private partnerships with state control. Chile holds the world’s largest lithium reserves and is currently the world’s second-largest producer.
“This is an opportunity for economic growth that will be difficult to beat in the short term,” Boric said in a televised address. “This is the best chance we have at transitioning to a sustainanable and developed economy. We can’t afford to waste it.”
Only Sociedad Quimica Y Minera de Chile, called SQM, and Albermarle mine lithium in the country.
Boric said the government would not terminate current contracts, but hoped companies would be open to state participation before they expire. SQM’s contract is currently set to expire in 2030.
Boric also said he would start a dialogue with communities, companies and legislators to create a national lithium company with 100% state ownership.
The company would need to be approved by Congress. Boric said he would present the plan to the legislature in the second half of the year.
Congress has been a check on many of Boric’s more ambitious proposals and shelved a proposed tax reform bill in early March.
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