This article is available in Chinese: 锂看上去对横跨亚洲的公司有益.
You know when China, Japan, South Korea, and Elon Musk are chasing the same dream, it has to be big.
Over 50% of the world’s lithium is in the so-called "Lithium Triangle" of Argentina, Bolivia, and Chile. As the Economist pointed out last year, each country is taking a very different approach to the development of the resource.
Argentina, making up for lost time under more protectionist governments, is working to overcome other hinderances. Provinces, not the central government, control minerals (per Article 124 of the Constitution), although the Macri administration last year negotiated an agreement with provinces putting a 3% ceiling on royalties. Lithium from northwest Argentina is exported over the Andes via Chile. As a result, the Argentine lithium market is surging, with local players such as Lithium Americas selling a 19.9% stake last January to China’s Ganfeng Lithium, in which Ganfeng will take 70% of production from the Cauchari-Olaroz brine deposit joint-venture with Chile’s Sociedad Química y Minera de Chile (SQM).
Bolivia is the sleeping giant of the triumvirate, with reserves as big as Argentina’s, but production a lot lower. A 2010 law establishing state control of lithium brine extraction. As a result, Bolivia has moved slowly in lithium's “white gold” rush. The country made it’s first shipment of lithium to China in August of 2016 — a whopping 25 tons. Last month Evo Morales said he wants Bolivia to be the 'Saudi Arabia of lithium' and "set the price for all the world.” But with the Chinese pushing "more coordination” between the two countries — and underwriting the budding Bolivian Space Agency — Bolivia runs the risk of being the next Ecuador, with China controlling the production of a vital resource, all in the name of “national sovereignty."
Chile ostensibly is the leader of the pack with the most developed infrastructure around the resource, but it actually has the smallest reserves of the three. The two current extractors, SQM and Albemarle are both publicly listed and recently had their licenses extended beyond the next decade. China’s Tianqi Lithium bought 2% of SQM in 2016, and rumors have swirled about different suitors looking for another stake — from Long Island's Renaissance Technologies to China's Ningbo Shanshan and Sinochem (although Sinochem turned around in 24 hours and denied pursuing a $4b stake) to others (every discussion of lithium has to have the obligatory Elon Musk and Tesla reference, and Chile has that, too). True to form, Chile's market-friendly approach is positioning the country to move up the value chain. Chinese auto companies such as BYD have talked to Chilean lithium producers about potential deals to secure supplies of the key battery material. And BAIC Group has even pursued building an assembly plant in Chile so as to take advantage of the lithium.
While the Chinese have expressed interest, like they do for all raw materials, when you’re talking about lithium in Latam, you’re not just talking about China. There are very few spaces where other Asian countries can compete with China in Latin America. But in lithium they do.
In Argentina, Sales de Jujuy is a joint venture between Australia's Orocobre Limited, Japanese trading company Toyota Tsusho Corporation (TTC) and JEMSE (the Mining Company of the Argentina provincial government of Jujuy). And last year BCP Innovation, a subsidiary of Thailand’s Bangchak Petroleum took a 16.4% stake in Lithium Americas, who had also been long-courted by Korea’s POSCO.
In Chile, the ongoing speculation in who will take a stake in SQM circles around not just Chinese names, but also the likes of Australia’s Rio Tinto, who worked with Canada’s Wealth Minerals and Chinese private equity firm GSR Capital to look at stake in SQM.
And the biggest lithium project of them all, Chile’s Development of Added Value Projects of Lithium request for proposals (RFP), shows how other Asia firms are competing with Chinese companies. Through an agreement with Albemarle, the winner of the RFP will get guaranteed the lowest price for long-term contracts for an initial 6700 tons scaling up to 16,000 tons through 2044. Needless to say, this piqued the interest of a lot of producers. Of the seven that made the short list, China's Fulin Group, Jiangmen KanHoo Industry, and Gansu DET will be competing with South Korea's Samsung SDI — to say nothing of local champion Molymet.
With the results of the RFP due any day now, China’s dominance in acquiring raw materials in Latin America may be challenged. As the Winter Olympics wind down, Korea’s biggest win maybe not in gold, but lithium.
S. Korea and Five Central American Countries Signed Free Trade Agreement — Business Korea
Comitiva hondureña viaja a Corea del Sur para firmar TLC — La Prensa
Central American nations to sign trade deal with South Korea — Yahoo News
Firma del TLC entre Corea y Nicaragua — Forbes
Preparando el nuevo escenario comercial entre Corea-Centroamérica — El Heraldo
Nicaragua, Panama, Honduras, Costa Rica, and El Salvador signed the Korea-Central America Free Trade Agreement in Seoul this week. After ratification by the respective countries, the FTA is expected to kick in by June. South Korea also has FTAs with Peru and Chile, and is looking to sign one soon with Colombia.
Consolidando los lazos con Japón… y sus vecinos — La Prensa Austral
Carne de cerdo, frutas y vinos: los sectores más beneficiados por el “nuevo" TPP sin EE.UU. — Economía y Negocios
Michelle Bachelet viaja a Japón con el TPP como tema principal de su agend — Notimerica
Guajardo: Con el TPP-11 y TLCAN, México tendrá lo mejor de dos mundos — Televisa News
Mnuchin says Washington studying possible return to TPP through renegotiation — Japan Times
Publican versión final del TPP, reglas impulsadas por EEUU quedan en suspenso — Swissinfo
Trans-Pacific Partnership fever - can you feel it? President Michelle Bachelet's final trip is to Japan this weekend, to finish details ahead of next month's signing. Mexican Secretary of the Economy Ildefonso Guajardo is optimistic that the deal will be a complement to his country’s position in NAFTA. Even the US is having second thoughts, with Treasury Secretary Steven Mnuchin saying the Trump administration is considering rejoining the TPP if they are able to secure better terms. With the clauses the US wanted still in the TPP — albeit suspended — the US might be able to get back into the club, but not under “better terms.” It might not even get some of those clauses reinstated.
La petrolera china Sinopec decidió quedarse en Argentina y ahora sale a buscar un socio — Bae Negocios
Fracasó el intento de Galuccio para quedarse con la petrolera china Sinopec — Diario Uno
Should the stay or should they go? Once rumored to be leaving, Chinese refinery Sinopec has decided to stay in Argentina and is looking for partners, of which local champion YPF and Pluspetrol are candidates. Sinopec’s decision was driven by Beijing’s incredulity at the $450m offer by Vista — headed by former YPF boss Miguel Galuccio — for assets Sinopec bought for $2.6b in 2010. A source close to Sinopec says:
“The Chinese government requests that such a loss be justified. Since no one can explain such a difference, and also since the price of a barrel of crude oil is rising steadily, there’s no longer any reason to leave."
Japan’s Mitsui wants more of Chile's Collahuasi copper mine, but none of Los Pelambres — Mining
Japonesa Mitsui reestructura inversiones en Chile para elevar producción de cobre — La Tercera
Japonesa Mitsui aumenta participación en mina de cobre Collahuasi en Chile — SwissInfo
Mitsui furthers mining portfolio with deals in Chile — Mining-Technology
Shuffling the cards? Mitsui is restructuring its copper investments in Chile by attaining minority interests in several different mines, or as they call it, “strategic asset recycling”. It will sell its 1.25% stake in Los Pelambres, but increase its stake to 11.03% in Collahuasi.
Visto eletrônico aumenta entrada de turistas no Brasil, confirma Embratur — IstoÉ
The Brazilian Tourist Board (Embratur) is chuffed about their new electronic visas for the US, Canada, Australia, and Japan. According to Vinicius Lummertz, Embratur’s president, the next step is to open Brazil to the Chinese market; discussions are supposedly already underway.
中国 对拉美直接投资超2000亿美元 跨境电商、共享创新合作业态多元化 — 21世纪经济报道 (21 Jing Ji)
In a report entitled “China’s FDI into Latin America Exceeds $200billion; E-commerce, Shared Economy, and Diversification” (中国 对拉美直接投资超2000亿美元 跨境电商、共享创新合作业态多元化) Alibaba's Cross Border E-commerce Research Center lays out it’s analysis of the potential for e-commerce in Latin America. They note that Brazil is the largest e-commerce market in Latin America — almost half of the total. Alibaba and Brazil’s postal service company Correios established a partnership in 2014, and AliExpress is sought after in Brazil. Last year Alibaba signed e-commerce agreements with Argentina and Mexico; it says it’s B2B business in the two countries already have millions of registered users. The Wan Fu Shan Industrial Park is the first large-scale industrial park developed by China in Mexico; it’s China's second largest overseas industrial park.
New ferry still docked in China — Guardian
New ferry delayed in China* — Daily Express
Chinese New Year delays Tobago ferry — Guardian
Trinidad and Tobago still has a lot to learn about China — delivery of the long-awaited new ferry to connect the two islands has been held up by Lunar New Year celebrations.
Automotriz china BAIC prepara inversión millonaria para construir fábrica en México — Xinhua
Chinese automaker BAIC to open first plant in Mexico — Xinhua
BAIC is moving forward with it’s plans to build a plant in Mexico. According to country director Jimena Saenz, BAIC plans to invest close to $1b in its first plant in Mexico. Saenz sees the opportunity beyond the uncertainty: “The commitment of BAIC with Mexico is long term, we’re looking much more to the future than to whatever happens” with NAFTA.
Arriban al puerto de Buenos Aires 20 nuevas locomotoras chinas — Xinhua
The twenty locomotives built by CRRC Ziyang for Buenos Aires’ suburban San Martín line have arrived in Buenos Aires. In total CRRC is building 107 locomotives, 3500 wagons, tools and materials.
Bici compartida , la industria que genera 1,700 MDD en China llega a México — Expansion
Mobike, desde China llega a Ciudad de México otra plataforma de bicicleta compartida — Xataka
Chinese deckles bikeshare companies Mobike and VBike are in Mexico. Mobike is launching a 200 bike pilot program, while VBike says it’s rolling out 5,000 in the delegación Benito Juárez. But VBike thinks it’ll only need 50,000 bikes for the whole country, so someone’s math seems off.
China tiene mucho que festejar (también en su comercio con México) — Forbes
México debe negociar con Asia: Torres Corzo — El Sol de San Luis
China es el gran ganador del TLCAN, asegura académico de la UNAM — La Jornada
Ni China ni EU son opción, México debe cambiar por dentro y ya no esclavizar su mano de obra: Simón Levy-Dabbah — La Vanguardia
China también es importante — Reporte Indigo
Mexican ambition is soaring. Enrique Dussel Peters, coordinator for the center of Sino-Mexican studies at the Autonomous University of Mexico (UNAM), reprimands Mexico for its lack of Mexican professionals dedicated to China, both in the private and public sector, wasting investment opportunities. Co-founder of Agendasia, Simón Levy, also points out Mexico needs a solid business model in order to excel as an industrial nation — just like China did. Senator Teófilo Torres Corzo, President of the Asian-Pacific Commission, has also remarked the need for Mexico to establish short-term investment strategies with Asia, which have invigorated the national economy in the recent past.
Chile releases cherry promotional video for Chinese New Year — Fresh Fruit Portal
It’s all about the cherries! The Chilean Cherry Committee release a video ahead of CNY to celebrate the occasion and remind consumers about cherry readiness in China.
A China sabe muito sobre o Brasil e o Brasil sabe muito pouco sobre a China — El Pais
#longread on China’s increasing presence in the West from FGV’s Oliver Stuenkel, in which he echoes our point by emphasizing that Brazil needs a China strategy, because China has a Brazil strategy.
América Latina: la última frontera de la rivalidad entre China y Estados Unidos — El Observador
Pese a Trump, el comercio de México con Rusia y China creció; advierten que EU va a tomar ‘venganza' — Vanguardia
EEUU se alarma por lazos de Rusia, Irán y China con Latinoamérica — HispanTV
China-Latin American ties prove US criticism wrong — Global Times
The weekly chin-strokes on what China (and Russia, and even Iran...) means for the US in Latin America. The most sober assessment is from Adm. Kurt Tidd, of United States Southern Command (Miami’s own Southcom) in his presentation of Southcom’s annual Posture Statement to Congress. China, of course, says everything is fine.
Las empresas peruanas apuntanal mercado de lujo en China — El Peruano
Chinese consumers are increasingly seeking luxury goods, and Peru thinks it can meet that need with Alpaca and Vicuña made products.
Argentina logró un acuerdo histórico para exportar carne a China — El Liberal
Fuerte crítica a los exportadores del embajador argentino en China — Clarin
El boom del “bife argentino", motorizado por China: las exportaciones de carne fueron las más altas en ocho años — iProfesional
Se duplicó la exportación de carne vacuna a China — La Voz
The Argentine beef industry is struggling with the opportunity presented by China. On the one hand, exports to China doubled in 2017. On the other, the Argentine Chamber of Industry and Commerce in Meats and Products (Ciccra) is complaining that their members are having to bend over backwards to meet China's phytosanitary requirements, requirements Ciccra says that Argentina had previously rejected. Argentine Ambassador in Beijing Diego Guelar is having none of it, and that his countrymen need to get with the program: “We need to profoundly review our export policy. Especially in the meatpacking sector.”
Peleas políticas, demoras y mucho malestar: entretelones de la puja entre China y Argentina por una central nuclear — Infobae
It’s not all joy between China and Argentina in nuclear power, either. A proposed $7b nuclear power plant has been blocked by local Río Negro province governor Alberto Weretilneck. The project may get moved to the existing Atucha plant at Zárate, Buenos Aires Province.
China supera EUA no ranking dos maiores compradores da região — Gazeta de Taubaté
Brazil’s Paraiba valley has traditionally exported it’s dairy products to the US. However last month China became the region’s biggest export market, consuming $108m in products.
Colombia quiere seducir a los turistas chinos — Expreso
The amount of Chinese tourists in Colombia increased almost four-fold between 2012 and 2017, and Colombia is seeking to attract more. Will it race Peru to attracting one million Chinese tourists a year?
Chile fortaleza relaciono con China en investigación antártica — Radio Polar
Chile firma convenio con China para investigación en la Antártica — Il Pinguino
China certainly isn’t picky about its reach. Chile and the Asian tiger have signed a memorandum of understanding making official the joint scientific investigation in the Arctic ocean.
Exportadores chilenos de frutas buscan abrirse mercado en China con peras y nectarinas — Spanish.China
We already know the Chinese love their Chilean cherries, but Ronald Brown, president of Chilean Association of Fruit Exports (ASOEX), says they’re looking to push nectarines and pears to the Chinese market. China currently imports 12.5 tons of Chilean nectarines.
Bridge for Chesterfield to arrive in Jamaica by end of March — Jamaica Observer
Seven bridges are being fabricated in China for delivery to Jamaica by the end of March, for a cost of $2m.
Cobre lideró exportaciones del Perú con US$13.773M en 2017 — America Economia
Perú licitará proyecto de cobre Michiquillay, el más importante de última década — SwissInfo
Copper led the way as Peru’s largest export in 2017, reaching over $13b, with China, Japan, Korea, and India as some of its top export markets. Peru hopes to auction its Michiquillay deposit next week, worth $50B in projects.
Más países siguen la nueva ‘Ruta’ de China — La Razón
More than 80 countries and organizations have joined the Belt and Road Initiative, which, according to Liang Yu, Chinese Ambassador to Colombia, has contributed to 30% of global economic growth in the last 5 years.
Indecopi impone derechos antidumping a cierres importados desde China — RPP
Peru is enforcing antidumping measures on Chinese imported zippers.
Nicaragua’s stalled US$50b canal ‘going ahead’ as funds evaporate — SCMP
We’ve found a new euphemism for “completely stopped and not going to happen."
Argentina avanza en nuevos acuerdos comerciales con Japón — Marco Trade News
AGROINDUSTRIA: Argentina y Japón avanzan en el fortalecimiento de la relación bilateral — Marco Trade News
Argentina and Japan are in the home stretch to signing a Bilateral Investment Treaty. Noriteru Fukushima, Japanese ambassador to Argentina, says Japan recognizes Argentina’s growth and would be interested in increasing its investments tenfold, reaching $1b.
Miniso prosigue la expansión en Latinoamérica con su desembarco de este año en Colombia — Fashion Network
Japanese fashion house Miniso has confirmed its first expansion into Colombia, its second Latin America country after Mexico, which already has 20 stores.
Crecen comunidad y empresas de Japón en Guanajuato, México — Prensa Latina
In response to the presence of companies like Mazda, Honda, Toyota and Nissan, Irapuato, Guanajuato, is getting its own Japanese school. The $3M investment will come directly from Tokyo.
ARGENTINA: Japan Wants To Invest In Energy And Mining Sector, Says Secretary — Interactive Investor
El fortalecimiento de la relación estratégica CAF – Japón promueve el desarrollo y la productividad de América Latina — CAF
Novedades del sector real y financiero — Infobae
Empresarios japoneses buscan incrementar sus inversiones en el país — La Nación
Japón busca desembarcar fuerte en la Argentina y envía una misión de 50 empresarios clave — Clarín
Japón enfoca su interés inversor en minería e hidrocarburos — Téla
Japón impulsa más inversiones en Argentina en energía y minería — El Economista America
Comitiva japonesa busca oportunidades de inversión energética en Argentina — El Diario Madryn
A delegation of Japanese companies led by JETRO and JICA focus on energy and mining in Buenos Aires. Horacio Reyser, Argentina’s Secretary of International Economic Relations, has said Japan’s investments in these sectors may reach up to $20b in 10 years (having already invested $1.6b in the past two years).
Japón y Turquía están entre los TLC que el Gobierno tiene pendientes por firmar — La Republica
Japón no termina de convencer a Colombia para dar luz verde al TCL — Finanzas Pedro Luis Olivares
As Colombian President Juan Manuel Santos’ term comes to an end, several free trade agreements negotiations have yet to be ratified, including deals with Japan, Turkey, and countries form the Pacific Alliance. Let’s see if the next presidency will be able to lock down these key markets.
Empresarios de Guatemala piden al Gobierno acelerar TLC con Corea del Sur — El Economista
Empresarios de Guatemala piden al Gobierno adhesión al TCL con Corea del Sur — La Vanguardia
Afraid to be left behind by their neighbors, business in Guatemala is begging the government to sign an FTA with South Korea. Guatemala is now the only Central American nation left to do so. Guatemala has yet to close 15 chapters, including cement, plastics, paper goods, and metals. Jorge Briz, president of Guatemala’s Chamber of Commerce (CCG), says it would be a “grave mistake” to let this TLC slip away.
Rosario estrecha vínculos con Corea del Sur — Notife
Mayor Mónica Fein of Rosario — birthplace of Che and Messi — received South Korean Ambassador Lim Ki Mo.
Perú: envíos no tradicionales a Corea del Sur sumaron US$ 196 millones — Peru
Cocoa, chestnuts, sacha indi, and fresh shrimp are among Peru’s non traditional exports to South Korea, which reached $196m in 2017.
Brasil tenta retomar exportações de carne bovina para a Coreia do Sul — Época
There’s a slight chance Brazil may get to export beef to South Korea again, reaching $2b a year. Slight.
Lithium Can Bridge The Gap Between India And Bolivia: Sergio Arispe, Bolivia’s Ambassador To India — Business World
In an interview, Bolivia’s Ambassador to India Sergio Arispe is picking up what we’re putting down, and sees the opportunity for Bolivia to reach out to India using lithium.
New Dubai Chamber report identifies fintech and renewable energy as key to boosting productivity and investment in Latin America — Arabian Business
Ahead of next week’s summit, the Dubai Chamber of Commerce and Industry has commissioned a report: “Latin America’s Emerging Sectors: A Closer Look at Fintech and Renewable Energy.” It would be awesome if they’d actually release the report, but here we are.
ASEAN & Oceania-LAC
Western hand in China’s grand plan could build trust, UK minister says — The Sydney Morning Herald
As the west cautions China’s advances, could the solution be to join them? That’s what Mark Field, British Minister of State for Asia and the Pacific, has said. Geopolitical concerns can be assuaged by bringing British and Australian expertise to the table — if you cant’ beat them, join them.