Bolivia announces US$2bn refining, mining investment push

Bolivia, a major zinc and tin producer, plans to invest US$1.97bn in its metallurgical and mining industries by 2020, President Evo Morales said.

Investment projects include a US$390mn zinc smelter between Oruro and Potosí departments, home to most of the Andean country's mining operations, and a US$4.5mn copper rod plant in La Paz, Morales said.

Another US$466mn has been earmarked for the El Mutún iron and steel project. The government is still battling previous operator Jindal Steel in arbitration proceedings after seizing El Mutún in 2010.

"Now we can announce this kind of investment, because the Bolivian economy is doing well," Morales said at a broadcast press conference at the presidential palace in La Paz. "It's a major challenge and commitment to guarantee these investments to keep growing."

Bolivia also plans to invest US$944mn in state company Comibol's Uyuni potassium chloride project, funds for which are "guaranteed," Morales said. In addition, US$149mn has been earmarked for a lithium carbonate plant in Potosí and US$11.7mn for the Coipasa saltflats project, said Morales.

Bolivia, which invested US$204mn in its mining industry in 2015, mostly in lithium projects, was forced to halt operations at both El Mutún and Comibol's Karachipampa silver-lead smelter because of technical problems and lack of financing.

Bolivia's mining exports dropped 13% year-on-year to US$1.48bn through October. Exports were hit by falling metals prices and a month-long protest in the mining region of Potosí.

Private investment has dwindled in Bolivia since President Evo Morales, who was sworn in for a third consecutive term in January, seized mining operations from companies including Glencore, South American Silver and Jindal Steel since first taking office in 2006.

Bolivia, which is home to mines operated by Pan American Silver, Sumitomo, Coeur Mining, Orvana Minerals and Franklin Mining, produced 19,287t tin, 407,332t zinc, 82,131t lead, 7,549t copper and 41.2Moz silver in 2013, the most recent available figure, according to the mining ministry.