Bolivia holds some of world's largest lithium reserves and significant deposits of tin, tungsten, and antimony. But the country is at a political turning point after an historic defeat for Bolivia's left party. As two right-leaning candidates move toward an October run-off, western investors are watching for new mining opportunities, but regulatory and social hurdles remain. Argus interviewed Luis Losada Simon-Ricart, head of Latin America at risk consultancy Aperio Intelligence, to discuss the candidates' positions on mining, the status of lithium agreements, the role of indigenous communities and Bolivia's economic outlook. Edited highlights follow:
What is the current economic situation in Bolivia?
Bolivia has faced a profound economic, political, and social crisis since at least 2019. The economy is grappling with high inflation — 24.86pc annually in July 2025 compared to 1.9pc in July 2019 — and a severe shortage of foreign currency, especially US dollars. This shortage is particularly concerning for a country that imports most of its goods, as was seen with recent fuel shortages. Politically, Bolivia is characterised by deep polarisation, government instability and frequent internal conflicts.
Where do the leading candidates, particularly frontrunner Rodrigo Paz, stand on mining and foreign investment?
During the campaign, he promoted the idea of "capitalism for all", aiming to attract foreign investment and bring much-needed foreign currency into the country. But he recognises the importance of securing support from regional and local communities.
He has also repeatedly stated that lithium alone will not generate the same wealth as natural gas once did. He believes the key is to diversify into other minerals and sectors.
What is your outlook on the lithium agreements recently signed by Bolivia? Do you anticipate these deals will be approved now that the country is moving away from a left-wing president?
Bolivia has historically seen very low levels of foreign direct investment (FDI), and both candidates have been very vocal about promoting foreign investment and ensuring legal certainty. It is unlikely that the new government will simply cancel the lithium deals signed with China CBC and Russia Uranium One Group last year. However, both candidates have publicly questioned the validity of these agreements.
The new administration is likely to audit, revise, and potentially renegotiate these contracts, while also working to establish a more business-friendly legal environment. The goal is to attract additional international mining firms, particularly from North America and Europe.
Neighbouring countries Chile and Argentina are far ahead in terms of their mining investment environments. Bolivia will need to create the right political, legal, and social conditions to attract investors.
Bolivia's court has suspended for a second time the approval process for two lithium concessions that state-run mining firm Yacimientos de Litio Bolivianos (YLB) signed with Russian and Chinese companies, citing environmental concerns.
This is yet another example of the challenges of operating in Bolivia without engaging all stakeholders, including local governments and affected communities. A new government may offer opportunities, but this is not a carte blanche — success still requires communities to be involved from the start, not just central government approval.
How do the candidates plan to engage with indigenous groups and local communities regarding mining projects?
As a centrist candidate, Paz is likely to seek dialogue with local governments and indigenous groups, including those aligned with former president Evo Morales.
Tuto Quiroga is likely to face significant opposition from local communities, particularly those supporting Morales, who could potentially bring the country and especially Cochabamba to a standstill.
This is a serious issue that international firms should not underestimate. Companies must engage in open, honest dialogue with local communities and should expect some resistance and opposition.
What are the most urgent governance challenges this administration must address regarding the environmental and social impacts of mining?
The main challenge will be to regulate and formalise Bolivia's artisanal mining sector, which is dominated by 2,300 mining co-operatives (cooperativas mineras) and their partners (kajchas or socios). These co-operatives have faced criticism for relying on informal labour, with workers putting in long hours under the promise of eventually becoming partners.
Mining co-operatives are a powerful and influential group. For example, the current interim governor of Potosi, Bolivia's most mineral-rich region, Marco Antonio Copa Gutierrez, is a mining co-operative member from the left-wing Movement to Socialism party. Notably, Paz received 43pc of the votes in Potosi, while Quiroga received 23pc.
What's your outlook for Bolivia's economy?
I suspect both candidates will also seek a loan from the International Monetary Fund early in their terms to stabilise the economy and bring much-needed foreign currency into Bolivia. The first round of elections has generated optimism among international investors and presents a window of opportunity for companies with a high-risk appetite to explore potentially lucrative mining deals.
However, Bolivia faces several institutional weaknesses, and governability is likely to be the new government's main challenge. If I were an international investor, I would begin by understanding the social and political landscape and identifying the relevant local and regional decision-makers in the areas where business opportunities exist.
