MercoPress. South Atlantic News Agency

Argentina betting on lithium and copper projects to overcome recession

Minister Luis Lucero said Argentina was pushing to become a global supplier of lithium and copper with significant foreign investment

With electric battery lithium leading, Argentina mining exports are expected to double to some US$ 10 billion in three years time, according to minister Luis Lucero who anticipated that copper is the other metal that will also have a huge boost given its importance in powering electric vehicles and artificial intelligence.

Lucero said Argentina was making an aggressive push, with several projects that should start sometime later this year, to become a global supplier of lithium and copper. Behind some of those projects are giant companies such as BHP, Glencore, Lundin Mining, First Quantum, committed to boost exports in coming years. Mining exports from Argentina currently stand at some US$ 4 billion.

The Argentine government under libertarian president Javier Milei is making a major pro-business push on mining, hoping to pull the economy out of recession after years of indebtedness, currency and inflation crises.

The country is already the world’s short list of lithium producers and is targeting to catch up with larger producers such as Chile and China.

Lucero said Argentina may be able to hit annual capacity of 200,000 tons of lithium carbonate equivalent (LCE) by the end of next year or early 2026, up from just under 140,000 tons currently. This would beat some previous government forecasts.

“This would get us closer to third place among lithium producing countries,” Lucero said, adding Argentina could reach 250,000 tons in the coming years. “With these production levels, lithium would become the country’s main mineral export.”

However the effects of years of mismanagement and economic crisis remain a major obstacle including a dramatic contraction of consumption and deepening recession. Nevertheless Milei’s government has won the backing from markets and businesses with incentive measures for large foreign investment, plus the fact opinion polls indicate people are prepared to stand by his measures, although in diminishing percentages.

Minister Lucero said the new measures, known by the acronym “RIGI”, (Incentive regime for Large Investments) include tax breaks and better access to foreign currency for large projects. He said this would help bring an “influx of new investment”.

Lucero estimated key lithium projects needed capital expenditure of over US$ 8 billion to get up and running, while the main copper projects needed some US$ 20 billion. He also admitted other “major challenges” such as improving energy infrastructure and road connectivity.