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The point of this move is to move the country higher up in the processing and profit chain because right now they are not the ones processing the lithium or mak

• kmfrk 3y ago
  Sounds like what Indonesia is also doing: https://twitter.com/70sBachchan/status/1587125692294201347 https://twitter.com/70sBachchan/status/1587125692294201347.
  • ochoseis 3y ago
    Here’s another guy talking about the same: https://youtu.be/BHFpGIwwh7M https://youtu.be/BHFpGIwwh7M
• 29athrowaway 3y ago
  But they don't have the resources to build the infrastructure to extract it in a profitable way. So likely what will happen is that China will do it and pay below market rate for the lithium. I would not be surprised if the entire Boric fiasco is just Chinese infiltration.
  • Cthulhu_ 3y ago
    That's one outcome, but they may find lots of companies and governments are willing to invest at more favorable conditions; the US is a logical candidate as well.
    • dandy23 3y ago
      Why would more companies/states be interested investing in Chile if Chile nationalizes and takes a bigger chunk of the profits than before?
      • shadowgovt 3y ago
        Stability and political counterweights. Having a stable Chile as a source of resources to stack against other sources of resources may be worth the markup.
      • alvarezbjm-hn 3y ago
        Because it is still profitable. Chile is one of the most stable Latinamerican countries.
        • nickpp 3y ago
          So was Venezuela.
        • 29athrowaway 3y ago
          Was stable. Now it is the Monty Python Argument Clinic, constitutional version.
      • patrickk 3y ago
        They're probably hoping to emulate Norway + Statoil, which has made the Norwegian state extremely rich[1]. It didn't stop oil exploration in Norwegian waters, quite the opposite. [1] https://www.ft.com/content/99680a04-92a0-11de-b63b-00144feabdc0 https://www.ft.com/content/99680a04-92a0-11de-b63b-00144feab...
        • jasmer 3y ago
          [flagged]
        • kspacewalk2 3y ago
          They might end up emulating a petrodictatorship instead, because it's an open question whether they have the state capacity, institutions, and most importantly a populism-proof electorate to achieve what Norway has, instead of the default "resource curse" option most other oil-rich countries fell into.
          • 3y ago
  • amrocha 3y ago
    [flagged]
    • deleted 3y ago
      [deleted]
    • swores 3y ago
      Not sure why you think the person you replied to wouldn't have issue with US doing it? I don't know enough about the situation to guess if their comment about China is 100% accurate or complete nonsense, but if it is the case then I'm against that and against many of the things the US has done to/in other countries over the past century. I'm not American, but even Americans are allowed to have views that don't align with how their country's political leaders have acted over the years.
      • amrocha 3y ago
        https://news.ycombinator.com/item?id=35861316 https://news.ycombinator.com/item?id=35861316 Because I'm right. It's not that hard to extrapolate what people think. It's hard for the "rationalist" crowd to understand but not everyone is arguing in good faith, and humans tend to regurgitate the last opinion they heard from a person they like. Of course, there's a small amount of time I'll be wrong, and I'm happy to apologize and have a proper discussion when that happens.
    • deleted 3y ago
      [deleted]
    • 29athrowaway 3y ago
      Better the US than the Soviet Union, which were the 2 flavors at the time.
      • malermeister 3y ago
        [citation needed]
        • 3y ago
  • whitemary 3y ago
    Installing state officials in South America is historically a US tactic, not a Chinese tactic.
    • rodolphoarruda 3y ago
      It has been a Russian tactic as well before the fall of the Berlin wall. The presence of Russians in Brazil during the military regime (mid 1900s) is well documented in history.
      • tomi-b 3y ago
        [flagged]
      • moate 3y ago
        It's a "wealthier nation" tactic going back to Spanish/Portuguese first contact. Fuck, it's called "Latin America" and I'm pretty sure Latin isn't native language. Rich people love pillaging and raping resource laden countries in the global south, assuming history is any indicator. Edited for spelling
        • inglor_cz 3y ago
          "I'm pretty sure Latin isn't native language." Latin isn't native language anywhere except Latium. English isn't native language anywhere except England (even excluding places like Cornwall that used to speak Celtic languages until the modern era). Arabic isn't native language anywhere except the Arabian peninsula. Heck, Quechua isn't native language anywhere but a very small region around Cuzco and was deliberately introduced by the Incas to make management of their huge, multiethnic empire easier. I don't think that ancient imperial language policies in itself are particularly shameful. Possibly the opposite. You can pillage and rape people without even talking to them, but if you want to trade and develop deeper relations, mutual understanding is a must.
          • nordsieck 3y ago
            > English isn't native language anywhere except England (even excluding places like Cornwall that used to speak Celtic languages until the modern era) I mean, if you really want to play the game, the Angles (along with the Saxons) aren't native to England (i.e. Angle-land); they were a germanic tribe. Of course, old english is a pretty far cry from the modern incarnation of the language.
  • r00fus 3y ago
    > I would not be surprised if the entire Boric fiasco is just Chinese infiltration. Large claims require citation. Got any?
• nocoiner 3y ago
  I doubt that’s the move at all - I think they’re just trying to capture more of a share of the extraction revenues. If you look at the history of the hydrocarbon industry during the 20th century, you saw the exact same trend over and over in countries without a history of private ownership of mineral resources. Exploration contracts were granted to foreign operators on favorable terms, and as the concessions were proved up (and petroleum gained geopolitical significance), those terms were slowly made less favorable to the operators, or the foreign operators were forced into local joint ventures, or their holdings were simply expropriated (or some combination of the above). It looks to me like Chile thinks they have leverage and are beginning to turn the screws. If their reserves are sufficiently vast and economic, this might not appreciably affect the overall trajectory of the Chilean lithium industry for decades, if ever.
  • intrasight 3y ago
    Honest question: What, if anything, does a country gain from nationalizing mining over just taxing it - besides scoring political points that is? In other words, would an economist be able to point out any benefits?
    • ozim 3y ago
      You get board seats for your political buddies. If company is privately owned you cannot simply appoint someone to a board to get nice salary.
      • intrasight 3y ago
        So no socioeconomic benefits. And likely drawbacks in terms of reduced revenue. So I assume that the next government will dispense with this nonsense.
        • FredPret 3y ago
          Too late. What investor will want Chile now? You make one peep about nationalization, and we all go stampeding the other direction. The whole place just went radioactive from capital’s perspective.
• WhereIsTheTruth 3y ago
  Chile is small producer Biggest one in that region is Argentina, and the US has been sanctioning them a lot lately, to the point where their country reached 3 digit increased inflation, 3 digits! So I suspect this is all done on purpose to further lower the price of lithium (corroborated with the lithium price in the global market, fishy fishy) so the US can have their green transition at lower cost, it's a sad era for South Americas yet again.. This nationalization is a step in the right direction, but that doesn't matter if it ends up in the hands of foreign countries for cheap... They should keep the lithium for themselves, manufacture batteries themselves and sell them with very high margins, if they don't do that, then something is fishy in the Chile/Argentina government..
  • rapsey 3y ago
    > Chile is small producer Huh? Second largest producer with by far the largest reserves. https://www.volkswagenag.com/en/news/stories/2020/03/lithium-mining-what-you-should-know-about-the-contentious-issue.html https://www.volkswagenag.com/en/news/stories/2020/03/lithium...
    • WhereIsTheTruth 3y ago
      Thanks for correcting me, my memory failed me
    • jeffbee 3y ago
      That chart seems to significantly understate USA reserves. What I heard is that just two sites, Salton Sea and Thacker Pass, amount to more than 50 million tonnes of reserves, plus significant deposits elsewhere.
  • santiagobasulto 3y ago
    I'm from Argentina, I don't think the 3 digit inflation is due to any US sanctions :)
    • chihuahua 3y ago
      Here on HN, everthing is the fault of the USA.
• sclarisse 3y ago
  The Chilean government is under the delusion that mining firms will supply expertise and most of the capital in exchange for a minority stake under a government that’s already demonstrated its interest in nationalization. This is a terrible move for them, which is why Australian lithium miners saw their shares jump on the announcement. Raising the royalties on the reserves, on the other hand, is something that could have actually worked.
  • williamcotton 3y ago
    Expertise and foreign capital? For pulling lithium out of the ground? Sure, don’t nationalize your semi-conductor industry, but we’re talking about primitive mineral extraction for a very abundant and very in-demand commodity, and without the need for much exploration. You know mining is like printing money but just darker and dustier, right? And I very much mean printing money. See: Dutch disease. A lack of a regulated economy and a free-for—all of resource extraction can lead to massive hangovers. This is more in the ballpark of the machinations of the Federal Reserve than anything else. The problems with Venezuela are not the problems with Norway. Norwegians are rich and can afford the time and energy to work within the practicalities of a mixed economy. Venezuelans are poor and seem more swayed by hope on big bets. It takes ample patience to throw out ideology and tease things apart for what they actually are. I don’t fault people in substandard conditions for being swayed by ideology, but for the rest of us can we be a bit more pragmatic?
• IG_Semmelweiss 3y ago
  History seems to suggest otherwise: 2005: The leaders of La Concertacion, Chile’s center-left ruling government coalition, want to eliminate the private profits of the private bus system [1]. They sell the new system as a way to make public safer and cleaner [2]. 2007: A consensus builds, and Santiago (Chile's capital) nationalizes urban transport network. It is a customer service disaster. Commuters wait at stops for 2 hours[2] as they see multiple buses drive by [1]. The 3000 bus companies get cut to 10, one of which (the public company) becomes the target of the largest class-action lawsuit in Chile, with thousands of commuters suing the new entity [2]. It is also a financial bomb, as the system goes from $60M in profits, to > $600M in losses[1], overnight, with 290M bailout after only 9 months [2] 2019: The "Estallido Social" (Social explosion) riots start, centered in santiago. The reason * Rise in public transport fares in Santiago * [3] 2021: A student leader and prominent figure in the 2019 riots [4], with a coalition of leftist groups and the communist youth of chile [4], is elected president. A new left government is now in power [1] https://scholars.duke.edu/display/pub1127207 https://scholars.duke.edu/display/pub1127207 [2] https://www.npr.org/2007/10/08/15100976/in-chile-commuters-sue-city-over-transit-system https://www.npr.org/2007/10/08/15100976/in-chile-commuters-s... [3] https://en.wikipedia.org/wiki/2019%E2%80%932021_Chilean_protests https://en.wikipedia.org/wiki/2019%E2%80%932021_Chilean_prot... [4] https://en.wikipedia.org/wiki/Gabriel_Boric#Role_in_the_Estallido_social https://en.wikipedia.org/wiki/Gabriel_Boric#Role_in_the_Esta...
  • xenospn 3y ago
    Hopefully they’ve learned a lesson or two.
  • gdubchcb 3y ago
    disingenuous and right wing biased sources. transportation and construction are the two major source of corruption in south America. the govt tried to please the existing company owners and they of course undermined everything and came out better than before. (the "private" transportation business on south America runs 100% on subsidies, even though it's expensive for the users) this is not an example against state ownership of a service cost center. but simply data that it can't be done by a centrist govt.
• antr 3y ago
  If you scratch the surface of the article you will realise that the biggest loser is Chile. This draconian law, if anything, will make investing in lithium production unattractive, regardless where in the value chain one invests.
  • r00fus 3y ago
    Until and unless we get better battery chemistries that are not reliant on LI, you're going to find someone who will work with Chile's requirements. It's a suppliers market and Chile has decided to "eminent domain" their resources and remove private ownership from the game, as is their right. Yesterday would have been the best time to do this, and now is the next best time. At some point battery chemistries will shift to Na or solid state will take the crown, but until then...