Prosperity promise of Bolivia's salt flats

Bolivia's Uyuni salt flats hold half of the world's reserves of lithium, a metal used in high energy density lithium batteries

As international carmakers scramble to find a suitable alternative to petrol vehicles, Bolivia hopes its lithium reserves could be harnessed to provide an energy source - and hold the key to new-found wealth and political influence. Peter Day has been to the Uyuni salt flats.

The sky is an infinite blue. The land is perfectly flat, and dazzlingly white, stretching to a line of distant volcanoes.

And here is the boss of a potentially huge project that Bolivia is pinning great hopes on, showing me his highly decorative chickens.

Twelve thousand feet (3,700m) up here in the high Andean plains of south western Bolivia, the subzero nights are bitingly cold, but the days are hot even in the middle of winter.

The unclouded sun is reflected upwards by the largest salt flats in the world, the Salar de Uyuni.

They are drawn to the salt flats by what lies metres below the ice-like crust of salt and mud

It is a spectacular desert. For decades now it has drawn young and hardy international backpackers to endure the dusty hours of jolting journeying by bus and train and 4x4 vehicles into a vast nowhere.

But now this arduous journey is being made by other people - engineers and businessmen from some of the world's largest mining and chemical companies.

They are here every week. They are drawn to the salt flats by what lies metres below the ice-like crust of salt and mud.

Down there is a great reserve of brine, and contained in the salty liquid, the largest deposits in the world of the lightest metal, lithium.

As is the case with fossil fuels, lithium is a limited resource

For years lithium has been used for specialist purposes such as ceramics, and pills for depression.

But suddenly there is a huge new potential demand.

Great expectations

Over the past few years I have driven or been driven in several rechargeable electric cars.

Vehicle manufacturers old and new are rushing to build substitutes for the internal combustion engine.

Great hopes are being placed on batteries with this very light lithium at their core, much quicker to charge and discharge power (so they say) than heavy conventional batteries.

So if plug-in cars catch on, lithium may be one of the vital raw materials for the auto revolution.

And here in the Salar de Uyuni the experts think that the difficult and poverty-stricken country of Bolivia holds 50% of the world's total supplies of lithium, contained in these vast hidden lakes of brine.

That is why Marcelo Castro, the man with the chickens (and rabbits too, he wants to be self-sufficient in this desolate place) is building a pilot plant to learn how to get the lithium out of these salt flats, and then how to evaporate the brine and separate the precious metal from the salt.

Evo Morales does not want lithium to be exploited by foreign companies

All this is raising great expectations in landlocked Bolivia.

To outsiders it is a very curious country, the second poorest state in South America after Guyana, a society riven by fault lines - great gaps between rich and poor, big geographical differences between the lush east and the towering Andes in the west, and sharp racial differences between successful former Europeans and a majority of indigenous peoples.

These last are the ones who voted the first indigenous president into office in 2006. Evo Morales has moved quickly to shift power in favour of the peoples he comes from.

State ambitions

He has nationalised the commanding heights of the economy including oil and natural gas. And he has moved to break up big land estates.

The president (with a kind of Beatles hairstyle) has also pronounced that the new windfall, raw material lithium, should not be exploited by predator overseas capitalist multinationals, but developed by the state for the benefit of Bolivia.

This brings great pride to a local campaigner I heard from in the town nearest the deposits.

Mr Castro says he is proud to be part of the pilot project

Wearing her characteristic native hat, based on the British bowler imported more than 100 years ago, Domitila Machaca told me how the local people had marched hundreds of miles to the capital La Paz in the 1990s to block the foreign exploitation of the salt flats; and she grinned toothily when she praised the Morales tactics of homemade development of these riches.

Later, still slowed down by the altitude, I wheezed slightly breathlessly in La Paz as I put it to the mining minister Luis Echazu that Bolivia was taking a big risk if it really wants to be (as some have said) "the Saudi Arabia of lithium".

"Oh no," he replied, "we want to go further than that - we don't want merely to process the metal, we want to make the batteries from it as well."

But that will take money and expertise, which Bolivia will have to import, and multinational companies are wary of socialist countries with big state ambitions.

Meanwhile, back at the salt flats, the plant construction manager Marcelo Castro gave me lunch - a vast egg sandwich made from one of the eggs from his chickens - delicious.

Despite the hardships, he was very proud, he said, to be taking part in this great Bolivian project.

If the world takes to the electric car, and if lithium really is the metal that will power it, and if the Bolivians can deliver, we may soon be hearing quite a lot more about the great Uyuni salt flats.

To say nothing of those fancy chickens.

You can listen to more of Peter Day's report on In Business, broadcast on Thursday, 20 August, 2009 at 2030 BST.

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