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The Success of M Auto’s Electric Motorbikes

Electric Motorbikes
Described as a “bold and ambitious” start-up, West African company M Auto aims to offer “mobility as a service” with its innovative e-bikes. Since its launch in 2022, M Auto has taken the nations of Togo and Benin by storm with its electric motorbikes and mission for affordable and sustainable transport solutions.

How Did it Begin?

According to its website, M Auto began its mission in 2019, but first launched with music concerts in Benin and Togo in May 2022. That same month, an article reported that 500 e-bikes were already operational and an additional 3,000 were ready for purchase, according to RealWire. With support from the Africa Transformation and Industrialization Fund (ATIF), M Auto was able to sell more than 2,000 bikes and register more than 2,500 pre-orders by September 2022.

The inspiration for, and success of, M Auto is largely in line with regional needs and systems. Co-founder Yasmeen Jawaharali told RealWire that “Benin and Togo have the biggest demand for commercial two-wheelers and progressive government policy for domestic manufacturing in the energy transition” and the March 2022 decision from the Togolese government to relieve import duties on electric vehicles has provided further incentive and opportunity for these developments. M Auto’s chief executive Shegun Bakari observed the high demand in Benin, with approximately “100,000 new bike registrations” annually.

Benefits of M Auto Vehicles

  • Environment: With zero carbon emissions, M Auto’s electric motorbikes provide a green alternative to regular fuel-powered motorbikes. Zems, traditional Beninese motorcycle taxis, contribute almost 4 million tons of CO2 emissions annually, according to Quartz. The nation’s transport industry is responsible for 65% of its emissions, The Guardian reports. Although the African continent is not a leading polluter globally, it is still subject to the effects of the climate crisis. The Clean Air Fund has predicted that “the economic cost of air pollution in African cities will increase 600% over the next 18 years,” as reported by The Guardian.
  • Health: Tied in with the environmental and economic challenges of pollution are its impacts on health. One of Benin’s “more than 250,000 moto-taxi drivers,” Domingo Soule, told The Guardian about his concerns for his health due to long days of inhaling exhaust fumes. Noting a cough and irritation in his eyes, he mentioned that he was “scared for [his] health” but “[didn’t] have a choice.” More than 1 million Africans died prematurely in 2019 from diseases such as stroke, lung cancer and heart disease, which air pollution could have caused or exacerbated. A switch to electric vehicles could play a vital role in alleviating such issues.
  • Affordability: Despite environmental and health benefits, Bakari acknowledges that “if it’s more expensive for [people], they won’t do it.” With a poverty rate of just under 40% in Benin as of 2019, and more than 50% in Togo, there is a need for innovations to be affordable. Due to high fuel prices, the cost of charging an e-bike battery for 70 km of travel could be cheaper than the cost of petrol, Quartz reports. Moreover, M Auto’s commitment to covering maintenance costs and providing competitive interest rates, makes it an attractive option for taxi owners otherwise dependent on easy finance.
  • Job Creation: M Auto equally provides advantages for citizens in terms of new job and training opportunities. Although the company is currently relying on exports and assembling locally, Bakari notes a desire to “manufacture everything locally” if possible, opening up room for new areas of training and education and providing employment. Indeed, the company is already building factories to fulfill one of its aims of manufacturing “exclusively […] for the African market […] allowing to create more jobs and ensuring that the process is by Africans for Africans,” according to RealWire. And according to Africa Energy Portal (AEP), M Auto’s additional plans to convert combustion engine motorbike to electric ones are also set to generate 2,000 eco-conscious jobs for young people in Togo.

Affordable and Sustainable Solution

M Auto promises not just material benefits of affordable and sustainable transportation, but also a shift toward a future of innovation. The company promises that its vehicles will allow Africans to “be their own bosses.” Even more, its success will “boost home-grown innovation and sustainable development in the long term.” Bakari highlights M Auto’s contribution to the continent’s “industrial transformation and ecological transition while creating jobs and lifting people out of poverty.”

Looking to the Future

So far, M Auto has seen remarkable success: as of August 2022, the company was Africa’s largest provider of electric motorbikes. It has already expanded to operate in Rwanda and Uganda as well as Togo and Benin. Although still most commonly found under the name M Auto, the company rebranded in 2022 to become Spiro and has ambitions to become the leading electric vehicle company on the continent.

– Helene Schlichter
Photo: Unsplash
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The Benefits of Electric Vehicles in Kenya

ELECTRIC VEHICLES IN KENYAKenya is among the African countries that are moving toward using electric vehicles, the introduction of which could positively benefit the economy and environment. Kenya currently has 671 electric motor vehicles in total with two-wheelers accounting for about 50% of this number. A recent Mckinsey study says the demand for electric vehicles is increasing and Kenya will make this transition quicker than many other African countries, “with electric vehicles accounting for 60 to 75[%] of all two-wheeler sales by 2040.” This projection considers several factors, including a better power supply in Kenya and an increase in the number of e-mobile companies operating in Kenya.

Kenya’s rapidly growing economy has earned it the status of a lower middle-income country, but it still struggles with a wide gap between the wealthy and the impoverished. This economic inequality is illustrated by the fact that two-thirds of Kenyans earn less than $3.20 per day, according to USAID. Moreso, the level of extreme poverty in Kenya is expected to stand at 25.3% in 2023.

Benefits of Electric Vehicles in Kenya

In Kenya, 75% of rural residents are farmers who typically lack access to cars, making it challenging for them to obtain fertilizers and seeds for planting. While some of them walk to their farms, motorcycles and bicycles are the popular modes of transportation.

Given the widespread use of two-wheeled vehicles in both urban and rural areas of Kenya, shifting to electric motorbikes can potentially increase mobility for residents while reducing greenhouse gas emissions and bringing other socio-economic advantages. Kenya will benefit from reduced air pollution when using electric vehicles. Nairobi, the capital city, has a pollution level of 70%, and this results in 19,000 deaths per year.

Ian Mbote, a staff member of Ampersand, an e-mobile company established in 2020 that has operated in Kenya since May 2022, spoke to African News about the cost efficiency of electric motorcycles. According to Mbote, swapping a full battery of an electric motorcycle costs 185 shillings and covers a distance of about 100 kilometers. In comparison, the cost of fuel for a fossil-fueled vehicle is 180 shillings per liter, which only covers a distance of 30 to 40 kilometers.

Electric Vehicles Initiatives in Kenya

One drawback of using electric vehicles in low and middle-income countries is the high cost of purchase, which may make the vehicles unaffordable for people living in poverty.

Several African governments are taking measures to make electric vehicles more affordable to their citizens. In Kenya, for example, the national treasury has lowered the excise duty for fully electric cars from 20% to 10%, making the vehicles more accessible. The government’s target is for electric vehicles to account for 5% of total imports by 2025, which would result in the importation of more than 15,000 such vehicles per year.

In addition to these measures, the Kenyan government plans to convert 2,000 cars and trucks to electric power over the next four years. According to CleanTechnica, “Kenya has an installed electricity generation capacity of 3,321 MW [and] the peak demand is 2,132MW. It is the low overnight off-peak demand of 1,100MW that Kenya Power wants to exploit initially to power Kenya’s transition to electric mobility.”

Looking Ahead

The high cost of electric vehicles is still an issue for many Kenyans living in poverty. But, there is still hope as efforts by the government are ongoing to make electric vehicles more accessible. These measures aim to bridge the gap between the high cost of electric vehicles and the need for sustainable transportation options in Kenya.

– Chidinma Nwoha
Photo: Flickr

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How Electric Vehicles Could Save Mexico

Electric Vehicles
The electric vehicle market has grown fast. With more people opting to purchase environmentally friendly modes of transport. According to IEA, electric vehicle sales “reached a record high in 2021.” In 2021, around the world, there were up to 6.5 million electric vehicles sold. Sales nearly doubled the numbers set in 2020. J.P. Morgen has estimated that by 2025, “30% of all vehicle sales will be electric vehicles.” The shift from combustion engines to battery-powered vehicles is becoming more of a reality every year. General Motors has announced its plan to “exclusively offer electric vehicles by 2035.” The growing electric vehicle market may appear like a victory for consumers and even car manufacturers. However, the real winner may just be Mexico. This is how Mexico may gain from the exploding electric vehicle market.

How “White Gold” Could Be a Potential Savior

Often referred to as “white gold,” lithium is an essential material for the production of electric vehicle batteries. With the increase in the manufacturing of electric vehicles, Investing News (INN) has stated that lithium has caught the eye of Elon Musk, CEO of the electric car manufacturer Tesla. As lithium becomes an increasing priority for car manufacturers, its prices have hit an all-time high.

Fortunately for Mexico, it has the ninth-largest lithium reserve in the world. The country estimates its Sonora lithium deposits value at more than $600 billion. Mexico’s total national debt amounted to $838 billion in 2022. According to Mexico Business News, the country could benefit from the growing demand for lithium.

With the demand for lithium only growing, Mexico could potentially change its fortune. The revenue gained from extracting lithium and selling it could hugely boost Mexico’s “stagnant economy.”

Potential Problems

Mexico has nationalized lithium. The reform effectively bans “all direct private investment and production in the lithium sector and creates a state-owned entity to extract, process and sell lithium.” The Mexican government was divided over the nationalization of lithium, some believing that the country would be unable to successfully extract and commercialize the metal itself.

President Andres Manuel Lopez Obrador has suggested private investment may be necessary due to the huge cost it will take. However, investors seem to show more interest in already established lithium markets, Reuters reports.

Whilst lithium prices have risen to $70,000 per tonne, Reuters understands that the clay deposits have largely trapped lithium in Mexico, making it difficult and expensive to mine. As a result, the lithium in Sonora has yet to see mining on a commercial scale.

Mexico in Crisis

Mexico is a country with high levels of corruption and drug trafficking. Council on Foreign Relations (CFR) states that the drug cartels in Mexico are “fuelling the rampant corruption and violence in Mexico.”

According to a 2023 article, roughly 52% of Mexican citizens live in poverty. This amounts to 57 million people. This largely attributes to a “lack of access to education, health care and well-paying jobs.”

As a result, some of the public in Mexico resort to joining drug cartels or engaging in corruption to improve their lives. Since 2006, CFR believes there to have been more than 360,000 homicides in Mexico, many of which link to cartel activity.

If Mexico can capitalize on its lithium reserves, the financial gain could help fund improved access to education and health care, and improve the availability of well-paying jobs. By doing so, Mexico could start to improve its large poverty issues.

Benefits to Mexico

El Pais suggests the Mexican administration has taken steps to take over control of lithium in the country. By nationalizing lithium, the objective is to make it a strategic resource such as oil.

If the Mexican government can invest and learn how to efficiently mine lithium, the revenue it generates from the sale of lithium would be part of the national revenue. Therefore, benefiting the entire country by being able to redistribute a larger source of income to the areas most important.

The government could use the revenue to improve access to education. There is a clear link between “increased educational provision and decreased poverty.”

There is also a link between poverty and crime. “In Mexico, 27% of people between the age of 25 and 34 had a tertiary qualification in 2021, compared with 47% on average in OECD countries,” OECD reports. In 2019, the country spent a total of “$3,577 per full-time student through primary to tertiary institutions compared to $11,990 on average in OECD countries.” By improving access to education, Mexico may begin to decrease the levels of rampant crime and corruption in the country.

Foreign Investments

Mexico has allowed China’s Ganfeng Lithium to massively increase its lithium mining operation in Mexico. Ganfeng Lithium, a major supplier of Tesla’s lithium, is one of the world’s biggest miners of lithium, accounting for 24% of global output. With this increase in investment in Mexico, there is a chance for long-term sustainable jobs for many in Mexico.

The increased investment could help improve the average wage within Mexico with a larger amount of well-payed jobs on offer. Thus, reducing the desire for many to join illegal drug cartels that fuel the extreme levels of corruption in Mexico. According to Quartz, 5% of Mexico’s GDP is lost to corruption, this amounts to $53 billion. The Mexican Institute for Competitiveness stated that this would cover three times the amount Mexico spends on its Department of Education.

The Future

Whilst it is clear that Mexico’s troubles will not vanish overnight, the discovery of an in-demand material such as lithium in Mexico could be a glimmer of hope. The link between poverty and the ongoing corruption and violent crime in Mexico is apparent. Should Mexico start to exploit the significant amount of lithium the country possesses, the government has the ability to make real change to the lives of many Mexicans who lack access to education, health care and the ability to find a well-payed job. Doing so potentially limits the power of drug cartels who continue to make life in Mexico insufferable for many.

– Josef Whitehead
Photo: Unsplash

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The Electric Vehicle Movement in India

Electric Vehicle Movement in India
In the densely populated country of India, the World Bank explained that the “road network is increasingly insufficient to support rapid growth in the economy.” Furthermore, “Most roads are generally in poor condition, urban traffic is clogged, public transport is unreliable and unsafe and intra-regional connectivity is inadequate.” Yet, the population requires affordable transportation to get to jobs, schools and businesses and access resources and services. The electric vehicle movement in India could be part of the solution to India’s transportation needs.

Electric Vehicles Growing in Popularity

The United Nations Development Programme reported that, in 2020, 16.4% of the population in India lived in multidimensional poverty and 18.7% of the population faced risks of falling into multidimensional poverty. In a country with a high population density and many people enduring conditions of poverty, electric vehicles present an affordable transport solution. With a median income of $2,400 for the average family in India, conventional cars are financially out of reach for many households.

In India specifically, two and three-wheel electric vehicles are most popular due to their low cost and ability to easily navigate the country’s congested streets. According to the New York Times, in India, one can purchase an electric scooter or three-wheel rickshaw for just $1,000.

The FAME Program

The main way the Indian government is trying to get the electric vehicle movement in India going is through a subsidy program. In 2015, India launched the first phase of the Faster Adoption and Manufacturing of Electric Vehicles (FAME) scheme to accelerate the adoption of electric vehicles in India. The first phase of FAME came to an end in 2019. The second phase then began and will end in 2024.

Under the first phase of FAME, 285,000 purchasers of electric/hybrid vehicles received 360 billion rupees worth of subsidies to make these purchases more accessible. The government redesigned phase two of FAME for the “faster proliferation of electric vehicles by lowering the upfront costs.” The second phase of the program has budgetary support of 10,000 crores.

In 2013, India announced the National Electric Mobility Mission Plan (NEMMP), a strategy to move toward fuel security “by promoting hybrid and electric vehicles in the country.” As part of this strategy, India launched the FAME program to accelerate the manufacturing and adoption of electric and hybrid vehicles across India.

Other Benefits of the Electric Vehicle Movement in India

Other than just economic benefits, electric vehicles also present an “environment-friendly public transportation option for the masses.” Because air pollution is a significant issue in India, lower emissions from electric vehicles will contribute to better air quality. The FAME program will lead to the establishment of an electric charging infrastructure, which will make electric charging stations more accessible to users. Through FAME, the government sanctioned 520 charging stations in the first phase. In the second phase, by February 2022, the government sanctioned 2,877 charging stations across 68 cities.

Business Perks for Others

Along with the country’s economy, businesses are benefiting from the electric vehicle movement in India. With the Indian government taking a lead in the movement, others are taking action too. Small companies and startups have turned to the subsidy program and are also gearing their businesses toward e-vehicle transportation or services.

One example is SMV Green Solutions, which Naveen Krishna started “to provide affordable, clean and safe mobility means for both drivers and commuters in the last mile transportation.”

Looking to the Future

The movement goes further than just electrifying vehicles — it boosts many people’s livelihoods by providing business opportunities and improving mobility. The idea is spreading through the example of India’s government and other startup companies that are making way for electric vehicles. Electric vehicles may be an effective solution for addressing transportation needs in growing nations.

– Marynette Holmes
Photo: Wikipedia Commons

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Zero-Emission Goals Affect Australian Capital Residents

Zero-Emission Goals On July 20, 2022, Australian Capital Territory (ACT) Chief Minister Andrew Barr released the Zero Emissions Vehicles Strategy. This initiative aims to revolutionize the ACT’s motor vehicle market by heavily promoting the sale and purchase of electric vehicles. It requires an overhaul of incentives, with increased accessibility and availability of zero-emissions vehicles (ZEVs) to gain resident support. However, some are concerned that the ambitious zero-emission goals aren’t mindful of how low-income residents will be affected.

Zero-Emission Goals

As of January 1, 2020, Canberra became the first non-European city to be powered completely by renewable electricity. The ZEV Strategy is the next step toward one of the capital government’s zero-emission goals to be carbon neutral by 2045. The ACT Greenhouse Gas Inventory for 2020-21 reported that the transport sector contributed the most emissions, making up to 63.5% of all carbon emissions in the territory.

Last month, Canberra announced its plan to become the first city in the ACT to ban the purchase of new fossil fuel vehicles by 2035. The purchase ban includes motorcycles and small trucks.  Within the next eight years, the goal is to have 80-90% of compact vehicle sales be zero-emission.

Resident Reactions

Despite the initiative’s good intentions, some are concerned about how the zero-emission strategy will affect Canberra’s low-income residents. “[It’s] one of the main concerns for most people,” 22-year-old Alysha Muhamad Khairuldin told The Borgen Project. The part-time technical expert depends heavily on her car to get to work as public transportation is limited in the city’s suburbs. “[I’m] not sure how this will affect me personally but hopefully, when they do decide to proceed with this plan, they will make good changes including making it affordable.”

Another Canberra resident, 21-year-old Callum Stewart-Thomson, divides his time between attending classes and working two jobs. “I’m not super comfortable [with my current financial situation] and would prefer not to have to stress about money so much,” he told The Borgen Project. Like Khairuldin, he also depends on driving as his main mode of transportation. “I chose petrol because it was the cheapest option, I can’t afford any other options,” he said.

The National Roads and Motorists’ Association reports that full battery electric vehicles can start at $47,500 in addition to on-road costs in Australia. Financing concerns include registration, stamp duty and electric vehicle charging rates. Other worries include having a shorter travel range, longer “fueling” time and lack of charging stations.

Following Suit

Australia isn’t the only country aiming to decrease motor vehicle carbon emissions. Within the next 20 years, the United Kingdom, France, Spain, Denmark and parts of the U.S. will restrict the sale of new gas-fueled vehicles. Some cities have also begun introducing electric public transportation. It is predicted that by 2025, electric vehicle sales will triple to around 20.6 million.

Canberra’s ZEV Strategy includes expanding the current charging network. At least 180 new charging stations will be accessible within the next three years, with 70 to be completed this fiscal year. The ACT government also announced that all new multi-unit commercial and residential buildings will be required to include charging stations. The government is offering a $2,000 incentive for the installation.

Going Green for Less

There are further incentives to make ZEVs more affordable. The current registration system is weight-based, making heavier electric vehicles more expensive to register. The new registration system will be emissions-based. Until June 30, 2024, all electric and hydrogen fuel cell vehicles registered in the territory will receive two years of free registration. The same vehicles will also be eligible for an exemption from stamp duty, a document and transaction tax.

The Sustainable Household Scheme, running until 2026, is offering up to $15,000 in zero-interest, 10-year loans. Those who are eligible may use this loan for energy-efficient improvements, including ZEVs, charging infrastructure, installation costs and more. The loan may be used to cover the costs of one or more approved products up to the maximum amount of $15,000.

– Aishah French
Photo: Unsplash

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Battery Swapping Policy: Recharging India’s Economy

Battery Swapping
With a population of more than 1 billion, it is no surprise that India is home to the world’s largest two- and three-wheeler market. Such vehicles traditionally have internal combustion engines that use gasoline to run. However, being the third highest greenhouse gas emitter in the world (contributing about 7% of total emissions), India is desperately trying to reduce its carbon footprint. The sustainable alternative is using electric vehicles (EVs) i.e, cars that have electric motors and are powered by electricity. Not only do EVs have “zero tailpipe emission” so they are beneficial for the environment, but they also have lower maintenance costs. In an incentive to push more people to purchase EVs, NITI Aayog, the Indian government’s think tank, released a draft policy in April 2022 that strongly encourages battery swapping for electric two- and three-wheelers.

Battery Swapping and Its Advantages

Two- and three-wheel vehicles like electric scooters, mopeds or rickshaws most commonly use battery swapping. Logically, it is easier to swap smaller batteries, unlike those batteries for large four-wheelers.

Usually, EVs contain fixed lithium-ion batteries that charge by taking electricity from the grid. This process is both time-consuming and tedious. If India wants more people to purchase EVs and make the momentum towards electrification faster, then the concept of battery swapping or “exchanging discharged batteries for charged ones” is much more preferable.

Detachable batteries “de-link” the vehicle and the battery, meaning that the battery can charge anytime without the vehicle. This eliminates the need to find a charging station. It also lowers range anxiety for drivers. Importantly, battery swapping also reduces the upfront costs of EVs because the batteries are being leased and not owned. This is a significant advantage because high upfront costs have been one of the main reasons that consumers have hesitated to purchase EVs.

The Policy’s Key Features

India’s main issue in making the adoption of EVs mainstream is the lack of proper charging infrastructure. The policy aims to change this by forming a battery swapping and charging network. Through that network swapping and charging will occur at stores, malls, parking spaces, petrol stations, etc.

An important feature of the policy includes interoperability between EVs, batteries and EV supply equipment. That allows different battery models to be compatible with different vehicle models. That, in turn, will increase efficiency. Also, maintaining safety protocols should assure people that their EVs will not burst into flames and increase demand. Finally encouraging private sectors to enter the EV market to fuel competition should also increase both the battery-swapping and EV industries.

The draft policy states that the priority for developing battery swapping will go to cities with a population of more than 4 million. Cities with a population of more than 500,000 get the second priority.

The reason why EVs are so expensive is because of the high cost of lithium-ion batteries. That is why the draft calls for a reduction of the 18% tax on batteries so that it is on par with the five percent tax on EV supply equipment. This will make EVs a more viable option for users.

Economic Benefits

A November 2020 Council on Energy, Environment and Water report underlines the economic benefits of deploying more EVs into the market. Since electricity is cheaper than gasoline, the long-run cost of owning an EV becomes lower for consumers. These savings on fuel (estimated at $14 billion by 2030) become additional disposable income. Consumers then spend that on different goods and services. In addition, more demand leads to more production. Consequently, this generates higher employment across various sectors of the economy. Another way EVs generate employment is through greater investment in the charging infrastructure. More investment means more output from industries and hence a greater demand for labor.

Industry Frontrunners

Many companies already make two- and three-wheelers with swappable batteries. The startup Bounce Infinity is a notable example. It recently launched an e-scooter with a swappable battery. The company is also installing over 2000 battery swapping stations across six cities in the country. Sun Mobility and Amazon India will partner so that swapping stations will be installed at Amazon warehouses in Maharashtra, India.

Looking Ahead

The Indian government aims to have electricity power 70% of all commercial vehicles and 80% of all two and three-wheelers by 2030. As the majority of India’s population uses either of these two modes of transportation, EV usage will prove to be a cheap and environmentally green option. As Bloomberg News suggests, “If policymakers can drive investment and capital towards the startups pushing through swapping, the rising awareness and utilization will ensure consumers are prepped for more electric vehicles in the future and hooked to the longer-term cost efficiencies.”

– Anushka Raychaudhuri
Photo: Wikipedia Commons

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Driving Growth: Electric Vehicles in Latin America

how-electric-vehicles-are-driving-growth-in-latin-americaElectric vehicles are quickly gaining traction all across the globe. Consumers are recognizing that battery-powered engines are not only good for the environment but can also save them money in the long run. Major automobile producers are taking note, with corporations like General Motors saying they will produce only electric vehicles by the 2030s. This emerging market seems to be a win-win for both consumers and producers. However, the largest benefactor of the shift to electric vehicles may not be producers or consumers, but instead Latin America. Here is how electric vehicles are driving growth in Latin America.

Foreign Direct Investment

Every major recipient country in Latin America saw foreign direct investment (FDI) rise in 2021, with the majority of this growth being tied to the mining and energy sectors. This is because Latin America contains some of the world’s largest deposits of cobalt and lithium, two mandatory ingredients of the lithium-ion batteries that power electric vehicles. In fact, Latin America contains the “lithium triangle” of Bolivia, Argentina and Chile where the highest lithium concentrations in the world are found. 

The Problem

Despite these vast stores of valuable minerals, many Latin American countries have been unable to capitalize on them thus far. Cobalt and lithium can be difficult to mine and store. Lithium, for example, takes 12-18 months of filtration after bringing the mineral to the surface before extraction can occur, according to Lithium Congress. While this process isn’t very capital intensive, researchers estimate it could take nearly 500,000 gallons of water per ton of lithium extracted. In one Chilean region, lithium mining resulted in the region losing 65% of its water.

For some rural communities, this simply isn’t feasible without outside investment in infrastructure.  Additionally, mining these materials poses serious health and safety risks to miners, civilians and the environment. In the United States, chemical leakage from lithium mining affects fish 150 miles downstream from a lithium mining operation, according to Lithium Congress. In order to extract these resources in a safe manner, this industry needs long-term infrastructural investment and new technology. Fortunately, due to the increase in popularity of electric vehicles, this investment is starting to flow into the region, developing new technologies to make the process safer.

Chile

Chile, one of the countries in the “lithium triangle” received a 32% increase in its FDI from 2020, bringing its total investment to $13 billion, according to UNCATD. However, not everyone celebrates this investment. Lithium mining in Chile has already placed a heavy burden on its fragile ecosystem. Many citizens are wary of investments that could increase this burden. Entire rivers are beginning to dry up in Chile due to excessive water waste from lithium mining. Without proper intervention, lithium mining is posing a direct threat to the indigenous communities across Chile that rely on natural water sources for agriculture.

Clearly, Chile needs a new mining method. Fortunately, KMX Technologies and CleanTech are teaming up to bring their proprietary Direct Lithium Extraction technology to the country’s mines. This technology could be able to minimize a mining operation’s environmental footprint, address water and other resource scarcity and make mining operations more efficient.

Argentina

Argentina contains the second largest lithium reserves in the world, but like Chile, it has had trouble capitalizing on these reserves. However, this is likely to change soon. Chinese corporation Ganfeng Lithium agreed to construct a $600 million lithium plant that solar panels power entirely. This project could create 100,000 jobs in the country.

Job creation is critical for Argentina. In 2021, the country posted an unemployment rate of 10.9%, a figure well below the OECD average of 5.7% in the same year. Construction on the mine started in June 2022 and while no expected completion date has been announced, the expected production from this mine is an astounding 20,000 tons of lithium chloride per year.

Brazil

In Brazil, relaxed rules on lithium exporting could draw $2.76 billion in FDI by 2030. The majority of this expected investment is predicted to go to one of Brazil’s poorest regions, the state of Minas Gerais. Approximately 1.21 million people in Minas Gerais are multidimensionally poor. The largest concentration of the multidimensionally poor in the state of Minas Gerais lives in the more rural northern regions of the state. This same area is where the largest lithium deposits in Brazil are found, along the Jequitinhonha River valley. Large-scale investment into lithium mining has the potential to completely transform this region and Brazil’s emphasis on sustainable development for Lithium projects adds a layer of protection for civilians in that area.

Lithium and cobalt mining has the potential to transform Latin American economies. While the two minerals can and have created problems for mining countries in the past, an increase in electric vehicle demand is driving corporations to solve these problems. In doing so, electric vehicles are also driving growth in Latin America, making mining cheaper, more effective, and safer. The FDI rushing into Latin America due to lithium and cobalt demand could not only transform the mining sector but most of the economy. This level of investment necessitates infrastructural investment, creates long-term jobs and could foster a competitive business environment.

–Benjamin Brown
Photo: Flickr