Oil of the Future: The Risk of Green Resource Nationalism on Lithium Extracting Countries in Latin America

Abstract

As the world approaches the 2030 mark to accomplish 17 Sustainable Development Goals (SDGs) as defined by the United Nations, the global demand for sustainable and clean energy sources is intensifying. In achieving the targets, unprecedented demand has emerged for some of the most critical materials used in renewable energy generation and storage. From solar panels to wind turbines, battery storage, electric vehicles and electricity cables, green technologies all relied on various minerals and metals. Among these critical materials, lithium has garnered the most interest as a key component for batteries, dubbed “oil of the future.” Particularly, Latin America possesses more than half of the world's identified lithium reserves, positioning the region as a geopolitical focal point in the carbon transition. Policymakers in the region are increasingly pushing to secure a greater share of the revenues from lithium extraction by halting privatization and starting to nationalize the sector. A new concept, “green resource nationalism,” has gained traction, aiming to reclaim control of the sector from foreign-owned companies. While proponents highlight potential benefits, critics raise concerns about potential price hikes and increased corruption risks due to weak institutional frameworks. Building on the traditional concept of resource nationalism focused on fossil fuels in resource-rich countries, green resource nationalism represents a contemporary evolution. This article analyzes the characteristics, domestic implications, and global repercussions of green resource nationalism through case studies of Chile, Mexico, and Bolivia. We employ a qualitative approach, combining literature review and discourse analysis of official documents to examine this concept.