Global Lithium Supply Chain Dynamics and Economic Dependency

The lithium-ion battery market is a significant sector, with a valuation exceeding $235 billion in 2023 and a growth rate of 15-20% annually. Resource-rich countries such as Argentina and Chile possess nearly half of the world's lithium reserves but remain economically dependent, exporting raw materials while receiving finished products at inflated prices.

China, holding a smaller share of lithium reserves, dominates the midstream processes of refining and battery production, capturing 83% of global cell output. This dynamic underscores the structural dependency of peripheral economies, which lack the necessary industrial infrastructure to retain value within their borders.

The approach taken by China, through strategic state intervention and investment in domestic capabilities, contrasts sharply with the extraction-centric model of the lithium triangle countries. Failure to internalize the value chain results in missed opportunities for job creation and economic development. The implications are profound, as the shift toward electric vehicles and renewable energy sources necessitates a reevaluation of how peripheral nations engage in global supply chains to ensure economic sovereignty and technological advancement.