Gold and silver, oil and gas, and now lithium: for centuries, Latin America has been a paradise for gold seekers. Not in the romantic sense, but literally: from Spanish colonial times onward, the region has been a giant open-pit mine where foreign powers - and later local elites - have dug relentlessly. First, there was the silver of Potosí, then Chilean copper, Venezuelan oil, and Argentine soybeans. Today, the new gold rush is all about Bolivian lithium, essential for electric vehicle batteries.

But while the world scrambles to secure a “green transition,” South America remains trapped in an old pattern: exporting raw materials to enrich others. Meanwhile, local communities are left with polluted lands, contaminated water, and an increasingly uncertain future. Welcome to the age of neo-extractivism.

Same script, new actors

A few decades ago, foreign multinational corporations were the main ones dictating the rules. Today, many of the region’s progressive governments have reclaimed control over natural resources. In theory, a step forward. In practice? The model remains the same: exploit the land to the last drop of oil or the last gram of minerals to finance national development.

The idea is simple: the State takes a larger share of the profits, uses that money to build schools, hospitals, and infrastructure, and in return, asks the population to turn a blind eye to the environmental and social costs. In Venezuela, Hugo Chávez nationalized oil to fund the “Bolivarian Revolution.” In Ecuador, Rafael Correa imposed new taxes on mining companies. In Bolivia, Evo Morales did the same with natural gas and, more recently, lithium.

Yet, despite good intentions, neo-extractivism continues to present the same old problems. Economic dependence on international markets makes the region vulnerable to price fluctuations - when commodity prices drop, entire economies collapse. Meanwhile, the “gold rush” (or lithium rush) fuels conflicts with local communities, who bear the environmental costs of projects they never fully agreed to.

Bolivia: the lithium dream vs. hard reality

One of the most emblematic cases is Bolivia, home to about 25% of the world’s lithium reserves. With skyrocketing demand for electric vehicle batteries, the government saw a unique opportunity: to become the “Saudi Arabia of lithium”, transforming the country into a high-tech production hub instead of merely exporting raw materials.

Sounds great, right? Unfortunately, the reality is much more complicated.

The first problem is that Bolivia lacks the technology to refine and process lithium on a large scale. The country has no well-established industry in this sector and must therefore rely on foreign partners.

The second problem relies on the fact that local communities are not on board. The lithium reserves are mainly located in Salar de Uyuni, one of South America’s most breathtaking natural wonders, and its extraction consumes enormous amounts of water, threatening local reserves. In 2019, a deal between the government and a German company was canceled due to protests from indigenous communities.

The third problem: is politics, of course. That same year, Evo Morales was forced to resign amid allegations of electoral fraud and tensions over lithium policies. The country plunged into a severe political crisis, and the lithium project was stalled for years.

The result? While Bolivia debates, Chile and Argentina move ahead in the lithium race, signing deals with major international corporations and leaving Bolivia behind.

But what’s the alternative?

While neo-extractivism has helped fund social policies and reduce poverty, continuing to base the economy solely on natural resource extraction is a dangerous gamble. The crises in Venezuela and Ecuador surely have demonstrated that after years of an oil boom, their economies collapsed as soon as oil prices fell.

And then there’s another pressing question: Who pays the price for extraction? Not the multinationals, not the governments, but indigenous communities, local farmers, and the incredible natural ecosystems.

Across Latin America, social movements and environmental groups are pushing for alternatives: Indigenous sovereignty over natural resources, preventing top-down decisions; more diversified economic models, investing in industry, technology, and agroecology; and a true ecological transition, not just replacing fossil fuels with lithium but rethinking the entire production system.

A significant example is the fight against the Conga mining project in Peru, where local communities successfully resisted a mining operation to protect water resources. A clear signal that the old extractivist model, with or without state control, is no longer passively accepted.

The future of Latin America

It’s clear that for many progressive governments, neo-extractivism has been a way to finance social programs and reduce inequality. But it’s also a temporary solution that fails to address the structural problem of dependence on global markets—and often, if not always, ignores the rights of local communities.

Is Latin America destined to remain just a vast mine for the rest of the world? Or will it finally break the cycle and build a more autonomous and sustainable economy?

The answer isn’t simple, but one thing is clear: the era of easy money from resource extraction is coming to an end, and it’s crucial that governments quickly find a new model for the region’s future.