UK excluding Huawei from 5G network

Thomas Scripps

The UK government has banned mobile providers from purchasing new 5G equipment from Chinese company Huawei after December 31. Existing Huawei equipment must be removed by 2027.

The announcement is a major reversal of Britain’s decision just six months ago to allow the company to provide up to 35 percent of the kit in the UK’s 5G network periphery. It follows a concerted international campaign waged by the United States to pressure its allies into refusing any Huawei involvement in the development of new telecommunications infrastructure.

President Donald Trump reportedly subjected Prime Minister Boris Johnson to an “apoplectic” phone call after he informed him of the UK’s initial decision. A few days later, Secretary of State Mike Pompeo held a two-day meeting with Johnson and Foreign Secretary Dominic Raab. A series of veiled threats were made to cancel or restrict US intelligence sharing with the UK security services, and to put the brakes on a post-Brexit trade deal. The final push came with the implementation of sanctions barring the use of American-patented technology in Huawei equipment, forcing Britain to use other suppliers if it continued to work with the Chinese company.

Huawei at Mobile World Congress 2016 (Image Credit: Kārlis Dambrāns/Flickr)

Trump was quick to boast of his administration’s responsibility for the UK’s volte face, responding to the announcement in a White House press conference: “We convinced many countries, many countries—and I did this myself for the most part—not to use Huawei because we think it’s an unsafe security risk, it’s a big security risk. … If they want to do business with us, they can’t use it.”

This left UK Health Secretary Matt Hancock to make a pathetic denial in an interview with Sky News, saying Trump was wrong to “claim credit” for the move. “We all know Donald Trump don’t we. But I think this is a sensible decision. All sorts of people can try to claim credit for the decision, but this was based on a technical assessment by the National Cyber Security Centre about how we can have the highest quality 5G systems in the future.”

In reality, Britain’s ban on Huawei marks another lurch towards the trade and military war camp of US imperialism, aggressively advocated by a group of Tory hardliners. It will have major political and economic repercussions.

Speaking for the concerns of large sections of the British ruling class, the Financial Times drew attention to the shift from the so-called “golden decade” of Anglo-Chinese relations begun by former Prime Minister David Cameron, to the “deep freeze” of today. While it endorses the government’s decision, based on “the changed security assessment and commercial constraints,” the paper’s editorial warned that it would come with “substantial cost.” In the immediate term, “it could delay the rollout of 5G networks in Britain by two years, as well as add up to £2bn to its cost. Operators may well demand compensation…”

Shutting the door on Huawei threatens to provoke economic reprisals. Economic ties between China and the UK have grown substantially in recent years, with China investing $79.5 billion between 2010 and 2019—twice as much as in the next European recipient—and Britain’s exports to China tripling between 2008 and 2018.

Chinese state-aligned newspaper the Global Times responded to the ban on Huawei with an editorial stating, “It is necessary for China to retaliate against the UK, otherwise would we not be seen as easy to bully. Such retaliation should be public and painful for the UK.”

Zhao Lijian, foreign ministry spokesman in Beijing, said, “It’s a litmus test for the direction where the UK market would go after Brexit, and whether the UK businesses in China will be provided with an open, fair, and non-discriminate environment.”

The FT cautions, “As the world fractures, and Britain charts its own course after Brexit, it would be damaging to be drawn into President Donald Trump’s new cold war with China. Realistic, constructive engagement with Beijing is the priority.” It quotes former Labour government cabinet member and now head of the Great Britain-China Centre, Peter Mandelson, saying, “If we are going to cut ourselves off from our privileged access to the European market and if we recognise that the US economy operates in quite a protectionist way, are we going also to isolate ourselves from China, the biggest source of growth in the world? Where are we going to make a living?”

But these are little more than words on a page. Political power is in the hands of hardline Brexiteers, seeking to use the UK’s break with the European Union to secure a closer economic and geostrategic alignment with US imperialism. Johnson may yet face a rebellion of up to 60 Tory MPs, led by former Tory party leader Iain Duncan Smith, demanding even faster and more extensive moves against Huawei. Smith asked in the House of Commons why its removal from the 5G network could not be accomplished by 2025 and “if they’re a risk to us in 5G, why are they not a risk to us generally [in 4G and 3G networks]?”

With these forces dominant in the Tory party and the Labour Party in a catatonic state—Shadow Foreign Secretary Lisa Nandy applauded the government’s “welcome, long-overdue step”—sections of the ruling class in favour of a balancing act between America and China based on Europe are left writing ineffectual press commentaries as a US-led war drive proceeds.

The HMS Queen Elizabeth, Britain's largest warship, anchors near the Lower New York Bay, Saturday, Oct. 20, 2018, in New York. (AP Photo/Eduardo Munoz Alvarez)

The same day the new decision on Huawei was announced, military chiefs revealed the UK’s new £3 billion aircraft carrier, the HMS Queen Elizabeth, would be making its maiden voyage to the Far East next year. According to the Times, the carrier will lead a strike group including four frigates, 24 F-35B Lightning II jets, and a nuclear submarine. It will participate in US-Japanese military exercises in the region to “counter the emerging threat of China,” according to one government source.

This all takes place just one month after the British government used Beijing’s crackdown on protests in Hong Kong and the imposition of an authoritarian National Security Law as a platform to support Washington’s economic assault on China—via sanctions on the Chinese-controlled territory. In this case, too, the UK is acting against the interests of many major British companies, more than 300 of which have regional headquarters or offices serving Hong Kong’s domestic market and the region.

These actions have a relentless logic. British imperialism is in a state of immense crisis following the Brexit vote of 2016, with the final pullout due to be effected at the end of this year. That the government is prepared to sacrifice the UK’s short and medium-term economic interests in its recent dealings with China is an indication of how closely it perceives the solution of that crisis to be tied to the fate of the US. The ban on Huawei demonstrates its strengthening commitment to a Washington-led reshaping of the world economy through protectionism and military aggression.

Markets soar as the corpses pile up

Andre Damon

Wednesday was a disaster in the United States. There were 71,670 new cases of COVID-19 recorded, the second-worst day on record. Nearly 1,000 people lost their lives to the disease, according to official figures.

With Texas hospitals at 90 percent capacity, dozens of mobile morgues are being dispatched to the state. In Florida, 54 hospitals now have zero available beds in their intensive care units. And, amid a full-on drive to reopen schools, officials said that one third of children who were tested in Florida were positive, adding to the body of evidence that children can play a major role spreading the disease.

The Institute for Health Metrics and Evaluation at the University of Washington reported that it estimates 224,089 people will die from COVID-19 by November 1, an upward revision of 20,000 from just one week ago.

Meanwhile, the most basic medical supplies, such as masks, gowns, gloves and disinfectants, “simply are not readily available from the usual sources our physicians use,” the American Medical Association reported.

The economic situation is equally disastrous. American Airlines said it would likely furlough 25 , 000 workers later this year, adding to the 36,000 furloughs announced at United Airlines last week. These layoffs are scheduled to take place despite the $25 billion bailout of the airline industry by the federal government.

The Organization for Economic Co-operation and Development (OECD) now predicts two possible scenarios by the end of 2020. Its “pessimistic” scenario is one in which the unemployment rate remains at 11.3 percent and economic output falls by 7.3 percent, both worse than any other recession since World War II. Its “more pessimistic” scenario is one in which the unemployment rate is 12.9 percent and economic output falls by 8.5 percent.

Amid all of this death and economic devastation, the stock markets surged, with the Dow Jones Industrial Average closing up for the fourth trading day in a row, with an increase totaling over a thousand points. The S&P 500 is now significantly higher than it was one year ago today.

Wednesday’s market binge was triggered by the announcement early in the day that Goldman Sachs, the Wall Street investment bank, posted one of its most profitable quarters ever, doubling the predictions of analysts.

There is no longer any question of the extent to which the stock market and the fate of society have totally separated. “The stock market and the economy have parted ways,” Mark Zandi, chief of Moody’s Analytics, told the Washington Post.

The massive run-up in stock prices and the profits of banks has only one explanation: The capitalist state has put at the disposal of its masters in the financial oligarchy unlimited amounts of money, the central purpose of which is nothing other than the enrichment of the wealthiest people in the world. As a result of the massive surge in the markets, US billionaires have become some $600 billion richer since mid-March.

To date, the Federal Reserve has funneled more than $3 trillion dollars into the financial markets, in addition to the $2 trillion in economic stimulus—much of it in the form of corporate bailouts—created by the CARES Act passed in late March.

All the claims that the bailout of major corporations by the CARES Act and the Fed’s bailout of Wall Street had anything to do with helping the mass of the population are totally exposed by what has taken place.

It would be hard to imagine a more corrupt social order than currently exists. The pandemic has become a favorable factor for enriching the financial oligarchy. As long as the crisis provides the pretext for massive bailouts by the Federal Reserve, there is no incentive to bring it under control.

If there were, even for a minute, any cutoff of the massive subsidies to the markets, there would be a devastating crash on the scale of that which took place in March, when the Dow fell by 50 percent.

The financial oligarchy lives at the expense of society, not just through class exploitation in factories and workplaces, but through the massive upward redistribution of wealth through the mechanism of the market.

While it has been hell for millions of people, the pandemic will be seen by sections of the ruling class as a certain golden age. As the bodies piled up, the oligarchs quarantined themselves in their beachfront properties and condominiums, flying between their residences on private helicopters and, at the sign of the slightest sniffle, attended to by private physicians.

It makes no difference that corpses are piling up in refrigerated trucks around the country. The bank accounts of the rich keep getting bigger and bigger.

As millions die, the ruling class and its media mouthpieces have only two demands: Reopen the schools and cut unemployment benefits. “American children need public schools to reopen in the fall,” declared the lead editorial of the New York Times on Friday. On Wednesday, it called for “a plan to reduce the payments” to workers “as the economy recovers.”

In the endless discussion of the pandemic in the media, there is never any examination of the social interests that drove the back-to-work campaign and the ensuing resurgence of the pandemic.

During the First World War, a major factor in keeping the war going—even as tens of millions died in the trenches—was the immense fortunes generated through war profiteering. So too now, it is the massive fortunes piled up that explain why there is no effort to bring the pandemic under control. While the oligarchy that dominates society makes trillions exploiting the crisis, there will be no serious effort to stop the daily toll of death and destruction.

Under these conditions, the expropriation of the capitalist class and the shutdown of Wall Street become a matter of public health. There will be no end to the pandemic without the class-conscious intervention of the working class, in a struggle against capitalism and the establishment of socialism, which will create the conditions for an effective response to the disease.

Conflicts and COVID-19: What Explains the Rise in Terror & Counter-Terror Ops in Southeast Asia?

Siddharth Anil Nair

The COVID-19 pandemic has helped induce ceasefires in a range of conflict zones around the world. This is not true, however, for Southeast Asia, which has witnessed an overall uptick in terror and counter-terror operations.

What this uptick looks like depends on the pandemic's impact on both terror and counter-terror dynamics. On an average, the pandemic has left terror groups scattered and underfunded, with state authorities emerging dominant. This commentary will examine the impact in Indonesia, the Philippines, and Myanmar, as these countries represent a range of terror activity in the region.

Terror Operations in 2020

Even though the number of terror-related incidents this year has fallen relative to earlier years, there have been a number of low-intensity operations (LIO) across Southeast Asia, ranging from beheadings to isolated attacks on police and army personnel.

Terror groups, now confined to certain localities, hamstrung by nationwide lockdowns and active surveillance, and unable to conduct training operations due to the loss of appropriate venues, have begun to make greater use of the online space. The repatriation of Islamic State (IS) fighters from Syria and Iraq, along with the IS’s view that the “coronavirus pandemic [is] a punishment of God against the tawagheet (idol tyrants) and disbelievers,” has spurred affiliates such as the Jama’ah Anshorut Daulah (JAD) and the Mujahideen of Eastern Indonesia (MIT) to issue fatwas against the government. Groups have increased propaganda and recruitment drives by using social media and their own online platforms to influence lone-wolf attacks and pass on bomb-making skills. The experience in Myanmar remains an outlier, with frequent, large-scale encounters between the Tatmadaw and insurgent groups, particularly those of the Brotherhood Alliance.

LIOs such as the attack on a police post in Indonesia’s South Kalimantan, or the drive-by shooting that killed two policemen in the Philippines’ Sulu province, are low risk but advantageous ways to maintain a presence in the eyes of the authorities and civilians. Along with LIOs, some groups – most notably the MIT – have turned to organising social movements and outreach programmes distributing supplies to the needy and poor. Protests and sit-ins against the government or perceived foreign enemies (such as China and Chinese businesses) organised by terror groups were a common occurrence in the beginning of 2020.

In response to a fall in global terror funding, groups have resorted to raids on villages, cargo ships, and military arms convoys. Others in more urban settings have targeted local banks and other financial institutions. Smaller militias have continued with their main source of income: kidnapping and ransom tactics. Myanmar stands out once again, with recent investigations in the northern Shan State revealing the minimal impact the pandemic has had on drug production and smuggling operations. 

Counter-Terror Operations in 2020

Most states in Southeast Asia perceive the pandemic first as a security issue, and then a health emergency. There are therefore not many impediments to the execution of counter-terror strategies, which has led to a higher level of militarisation.

Following the efforts of the Philippines’ Western Mindanao Command (WestMinCom) and the Eastern Sabah Security Command (ESSCOM), a number of Abu Sayyaf Group (ASG) fighters in the country have either surrendered or been assassinated. Likewise, Indonesia’s National Counter Terrorism Agency (BNPT), along with local police, has ramped up its raid and capture/kill operations across all Indonesian provinces, while simultaneously setting up larger intelligence-sharing mechanisms with neighbouring countries. This has resulted in the seizures of record quantities of arms, ammunition, and home-made explosives. Finally, the Tatmadaw has continued high-intensity shelling missions and air raids against groups such as the Arakan Army.

Anti-terror legislation across countries—including regulations for financial crimes and online surveillance— have also undergone changes. In the Philippines, the 2007 Human Security Act has been replaced with the 2020 Anti-Terrorism Act, which removes a number of checks and safeguards against unlawful rules-of-engagement and human rights abuses. In Indonesia, a presidential decree has extended counter-terror operations to the Indonesian Armed Forces (TNI), and the Peoples’ Consultative Assembly has revamped financial crimes regulations to meet international standards. Similarly, in Myanmar, barring the dependence on kinetic operations, there have been changes to anti-money laundering regulations. A change across the board is greater use of existing Internet and financial crimes regulation laws sheathed in anti-terror legislation.

Conclusion

From the state's perspective, the employment of LIOs by terror groups will continue to be a key challenge given the minimal planning and equipment required to execute them. The other challenge is the redirection of policing and emergency response infrastructure towards managing the pandemic.

Terror groups now have an opportunity to recuperate and reconsolidate their capabilities for larger operations in the future. However, with greater population controls and active surveillance as a result of the pandemic, states seeking to dismantle such groups have the opportunity to do so—kinetically, through intelligence operations, and the tightening of legislation.

Maritime Power and the Pandemic: US’ Loss; China’s Gain?

Jack Kai Yui Wong

Beginning April 2020, China has launched a series of offensive actions in the South China Sea (SCS). They include the establishment of administrative districts in disputed islands, sinking a Vietnamese vessel, and deploying an aircraft carrier to the region. These reflect China’s regional ambitions, particularly its aim to secure ownership of 85 per cent of the SCS under the ‘nine-dash line’—a claim that clashes with the United Nations Convention on the Law of the Sea's (UNCLOS) definition of an exclusive economic zone (EEZ).

This commentary argues that China took advantage of the COVID-19 pandemic to advance its strategic position in the region. The ultimate goal for the Chinese People’s Liberation Army Navy (PLAN) is to break out of the ‘first island chain’, which starts from Japan and ends at the Philippines, covering all of China’s ‘near-seas’. It will allow China a gateway to the Pacific Ocean, and a platform to further challenge the US. 

Challenging the Status QuoOver the past few decades, the SCS has been home to various territorial and maritime disputes. Comparatively speaking, it is easier for the Chinese Navy to exploit the weakness of the US Navy in the SCS than the Yellow and the East China Seas. While the US does not have any naval bases in the SCS, the PLAN is better equipped and has tremendously enhanced its capabilities in recent years.

Between 2015 and 2017, the PLAN launched almost 400,000 tonnes of naval vessels, about twice the output of US shipyards in the same period. Chinese troops stationed in Hainan Island can reach both Spratly and Paracel Islands faster than US troops stationed in Guam. To successfully expand its influence out of the first island chain, the PLAN has to become the dominant power in the SCS. The COVID-19 health crisis was accordingly managed into a maritime opportunity by China. 

Maritime Power VacuumsThe Chinese government’s recent actions were attempts to fill up the power vacuum left by the US in the SCS.

On 27 March, the USS Theodore Roosevelt carrier strike group (CSG) of the US Navy arrived at the naval base in Guam, leaving the Philippine Sea with no US military forward deployment. The group had no choice but to leave the Philippines owing to the COVID-19 outbreak onboard that infected a quarter of its crew. The pandemic thus undeniably impaired the US’ operational capability in the region, especially prominent patrols to ensure freedom of navigation. China has sought to occupy this vacuum created by the diminished US maritime presence. Further, Southeast Asian countries and the US are concentrating their efforts to deal with COVID-19, which has impacted focus on other areas, such as surveillance over Chinese political and military movement.

China has replicated this aggressive approach with Vietnam and Malaysia as well. On 3 April, a Chinese maritime law enforcement vessel rammed and sunk a Vietnamese fishing boat near the Paracel Islands. China’s Haiyang Dizhi 8 initiated a survey within Malaysia’s EEZ, near the site West Capella has been drilling in since mid-April.

On 13 April, the Liaoning aircraft carrier and five escorting warships sailed across the Miyako Strait to conduct a long-range training exercise in an area close to southern Taiwan in the SCS. Through the scale of the military exercise, China aimed to demonstrate that the pandemic had not paralysed the PLAN, unlike other navies. Additionally, the Chinese State Council approved the establishment of two administrative districts in the Paracel and the Spratly Islands. The combination of both political and military measures suggest that China is determined to formulate a Beijing-led maritime regional order, replacing the US, and becoming the leading power in the SCS.

China’s provocative actions demonstrate the PLAN’s growing maritime patrolling and monitoring capabilities. They also serve as signals to the US and its regional allies that Beijing is well-quipped to take on the vacuum left by Washington, and that its navy is capable of gradually blocking all countries’ freedom of navigation in the region.

Looking AheadFirst, China might militarise the Paracel Islands, such as through the deployment of DF-21D anti-ship ballistic missiles (ASBMs), to increase its chances of breaking through the first island chain. Beijing has undertaken such actions since 2014, when it transformed seven reefs and rocks into artificial islands in the Spratly Islands by constructing airstrips and port facilities.

Second, China will continue its naval build-up to ensure sufficient monitoring and administrative capabilities over the Paracel and Spratly Islands. With the continuous deployment of more advanced naval vessels, including the Renhai (Type 055) cruiser and the Luyang III (Type 052D) destroyer, the PLAN is narrowing the gap with the US Navy in terms of both quantity and quality. Alongside increased production, Beijing may come to have the power to impede other countries' freedom of navigation, and increase the costs of any potential intervention by the US.

DFID – UNHCR – World Bank Program: Building the Evidence on Forced Displacement 2020

Application Deadline: 30th July 2020

About the Award: In 2016, the UK government’s Department for International Development, the World Bank, and the UNHCR established a joint research program, Building the Evidence on Protracted Forced Displacement: A Multi-Stakeholder Partnership, with the objective of improving global knowledge on forced displacement.
The program is now launching a call for research proposals (papers) under the first new research component: Preventing social conflict and promoting social cohesion in forced displacement contexts.
The goal is to better understand how policy measures and development investments, and their interaction with local contexts, can help reduce inequalities, alleviate social tensions, and promote social cohesion
between and within displaced populations and host communities. The papers generated from this call will be used as background papers to prepare a report on this topic. The evidence generated through this research program will inform World Bank programming and UNHCR protection programs in forced displacement contexts.
Research proposals are encouraged in three areas. Some proposals may cover more than one theme.

Type: Call for papers

Eligibility: Submissions by both individuals and research teams will be considered. A maximum of two papers per author can be submitted; applicants are limited to serving as the lead author on one proposal. Lead authors are expected to be external to the World Bank or the UNHCR, but research teams can include World Bank and/or UNHCR staff.
Proposals should be limited to two pages and include the following information:
• Theoretical framework and key literature
• Research question(s)
• Hypotheses, assumptions
• Empirical and identification strategy
• Data sources
• Policy relevance

Selection Criteria: Proposals are expected to meet the following selection criteria:

1. Papers should consist of original empirical analysis. Papers that draw on data analysis that has already been published or that appears in papers under review will not be considered.
2. Papers are required to be completed within 6 months of the signature of the contract.
3. Papers should rely on existing and available data. Given the time frame and the COVID-19 crisis, papers that propose new data collection will not be selected. The World Bank and the .
4. UNHCR will give authors access to their respective data stores in compliance with existing security and privacy requirements. Proposals that include data sets at the World Bank or UNHCR that have not yet been made available to researchers will be considered.
5. Proposals should focus on “displacement settings,” which may include the origins of displaced persons and/or host communities. “Displaced persons” is defined to include refugees and internally displaced persons. “Social conflict” includes conflict that leads to displacement as well as clashes within and between displaced populations and host communities. Social conflict is not limited to overt violence, and may include forms of implicit and explicit exclusion.

Number of Awards: 25

Value of Award: The program will finance up to 25 papers. Each paper will be awarded a grant of $25,000 regardless of the number of authors. Grants will be paid in the form of Short-Term Consultancy contracts with the World
Bank. The terms of the contracts will be agreed with each contracted scholar, with the total amount of contracts per paper limited to $25,000.

How to Apply: Details (.pdf) – Application form

• It is important to go through all application requirements in the Award Webpage (see Link below) before applying.

Visit Award Webpage for Details

World Bank Group Africa Fellowship Programme 2021 for sub-Saharan African Graduates

Application Deadline: 23rd August, 2020

Eligible Countries: Sub-Saharan African countries

To be taken at (country): World Bank offices in Washington, D.C. or in a Sub-Saharan country

About the Award: Launched in 2013, the World Bank Group (WBG) Africa Fellowship Program targets young talented African nationals who are completing or recently completed a Ph.D. in an area relevant to the World Bank’s work. The fellowship program has been very successful since its inception, building a strong pipeline of young African talent interested in a career in development, in international institutions, African governments, think tanks, and academia.
The program offers chosen fellows a six-month assignment at World Bank Group (WBG) offices in Washington D.C. or in country offices to gain hands-on experience in the operations of the WBG. This includes knowledge generation and dissemination, design of global and country policies, and the building of institutions to achieve inclusive growth in developing countries. While benefitting from research and innovation in multiple sectors, fellows will also work on research, economic policy, technical assistance, and lending operations that contribute to the World Bank’s goal of eliminating poverty and increasing shared prosperity. Through the fellowship, we aim to build the capacity of the next generation of African change makers in development, policymaking and promote the goals of reducing poverty in the region.
The 2020 WBG Africa Fellowship Program expects to host up to 15 fellows. This year, with the support of the Think Africa Partnership, a private sector window provides support for 10 additional fellowship positions with a special focus on private sector development and finance. The additional 10 fellows will work on improving the macroeconomic, business and financial frameworks to enhance private sector investment, strengthen economic policy making and ultimately promote economic growth across the region.

Type: PhD, Fellowship
policy making and ultimately promote economic growth across the region.

Type: PhD, Fellowship

Eligibility: A candidate of the World Bank Africa Fellowship must:

• Be a recent Ph.D. graduate (within three years of completion) or be enrolled in the last year of the Ph.D. program.
• Have an excellent command of English, both written and verbal 
• Possess strong quantitative and analytical skills 
• Be under the age of 32 by the closing of the application period

Selection Criteria: The following additional attributes are highly desirable:

• a command of an additional World Bank official language
• national from fragile and conflict-affected countries
• candidates from refugee and internally displaced communities and/or with proven experience on forced displacement

The selection process consists of two phases: 
In the first phase, a short-list of candidates will be made available for hire for the different units of the WBG depending on applicants’ specialization. Applicants will be notified of about the status of their application or whether they have been shortlisted or not.
In the second phase, the final list of fellows will be selected in consultation with the various units of the WBG. When the selection is complete, all shortlisted candidates will be informed of their selection status. 

Number of Awardees: 25

Value of Fellowship: Selected candidates will then be notified and, upon acceptance, will be hired as short-term consultants for six months starting January 2021. Fellows are eligible to receive consultant fees, round-trip economy class air travel to Washington, D.C. or a WBG country office from their university or institution, and worker’s compensation insurance.  

Duration of Fellowship: Fellows will spend a minimum of six months. The fellowship period of engagement is January-June 2021.

How to Apply: Apply for the Africa Fellowship Program now

Visit Fellowship Webpage for details

The Ravages of Lithium Extraction in Chile

Yanis Iqbal

In Chile, the Covid-19 pandemic is raging with an unprecedented speed. There are more than 300,000 confirmed cases with one of the highest per capita infection rates of 13,000 cases for every 1 million people. The economy is severely experiencing the repercussions of Coronavirus-caused restrictions and the historically high national unemployment rate of 11.2% is an indicator of such damage. Chileans have took to the street to protest against the malfunctioning right-wing government of the billionaire president Sebastian Pinera and the police force has responded aggressively by shooting dead a young agitator.

Amid this Coronavirus chaos, the Chilean lithium sector is poised to economically expand itself due to an anticipated increase in demand. Albemarle, a North Carolina-based corporation and one of the two companies extracting lithium from the Chilean salt plain Salar de Atacama with Sociedad Química y Minera (SQM) or Chemical and Mining Society, said that “the current slump in prices is belying a looming supply shortfall, especially as expansion projects are delayed by the crisis”. TDK, a Japanese multinational electronics companies and battery giant, predicts that the global market is going to witness a surge in demand for lithium. Shigenao Ishiguro, the CEO of the company, told in an interview that “Digital transformation is a huge opportunity for us and I have no doubt that the coronavirus will push the world to go that direction at a faster pace,”.

In spite of Covid-19 pandemic, the battery market is expected to grow “at a compound annual growth rate of about 7% during 2019-2024. The market in cathode for lithium ion batteries, the most common rechargeable car battery, is expected to jump to $58.8 billion by 2024 from $7 billion in 2018”. According to Bloomberg, the pandemic can prove to be an opportunity for the lithium market “with at least some governments, including those of Germany and France, using virus recovery funds to help accelerate a transition from internal combustion engines to battery-powered alternatives. France will offer about 8 billion euros ($9 billion) to its auto sector to bolster support for electric vehicles; Germany’s stimulus package includes about 5.6 billion euros for the sector and will require gas stations to install charging units.”

A likely intensification of lithium exploitation in Chile does not bode well for the working class and the myriad indigenous communities such as the Atacameños, Licanantay, Colla, Aymara and Quechua living in the Atacama desert. The most recent manifestation of the exploitative practices of lithium mining companies has been the maintenance of “operational continuity” to achieve a minimal impact on output. This basically translates into a policy of profit maximization, brutally indifferent towards the existential conditions of workers. In the lithium mining region of Antofagasta, the Coronavirus positivity rate was a stupendous 46.1%. Along with this sheer infliction of necropolitical violence upon the working class, the indigenous people are also reeling under the pressures of lithium extraction in the form of a water crisis. While singular focus has been placed on the issues of water scarcity in urban areas, it is important to remember that indigenous communities living in Salar de Atacama too are coping with an acute water scarcity, artificially caused by lithium operations. In the aforementioned mining region, 65% of water has been consumed by lithium activities. This is one among the many environmental injuries sustained by the ecosystem of the Atacama desert due to the unhindered workings of lithium imperialism.

Instead of seeing the ongoing suppressive squeezing of the working class and indigenous communities in Chile as a one-off phenomenon, it is necessary that it be contextualized in the global structure of lithium imperialism. Lithium imperialism came to be installed as a fraction of global capital and primary commodity production due to two major developments – planetary mine and green extractivism. Firstly, planetary mine, as said by Martin Arboleda, “designates a convoluted terrain where fences, walls, and militarized borders coexist with sprawling supply chains and complex infrastructures of connectivity.” This denotes the establishment of an extractive economic exoskeleton on a planetary scale through the simultaneous use of violent and militarized techniques of oppression and policing.

Secondly, green extractivism refers to “the subordination of human rights and ecosystems to endless extraction in the name of “solving” climate change.” Lithium serves as an important modality for substituting fossil fuel extractivism with green extractivism and consistently maintaining a relentless system of commodification. Instead of “tackling the systemic bloating of northern economies and the excessive demands this places on the world’s resources.”, green lithium extractivism allows capitalists to stabilize the unequal imperialist architecture of core-peripheral countries. Tesla, for examples, uses the discourse of electronic vehicles to cloak its capitalistic carnage of Latin America with the cosmetic coverings of climate change.

Lithium imperialism indicates the cohesive amalgamation of planetary mining with a climate change-covered discourse of extractivism. The fusion of these two distinct strategies initiates a reign of hyper-exploitation, extraction, violence and dispossession in the name of climate change. But this oppressive underside of lithium business is sordidly shadowed by the propagandist puffery of an energy transition which actually feeds upon the body of oppressed workers of Global South. Lithium imperialism, therefore, involves the perpetuation of core-periphery relations under the discursive regime of climate change.

Chile is a victim of contemporary lithium imperialism due to the vast lithium reserves which it has. The country has 48% of the total lithium reserves in the world which amounts to 7.5 million tonnes of lithium, of which 6 million tonnes is found in Salar de Atacama. Chile is part of the lithium-rich area christened and commodified by the bourgeoisie as the “Lithium Triangle”. It is formed by northern Chile, northern Argentina and south Bolivia and has 70% of the world’s lithium brine deposits. Apart from the abundance of lithium, Chile is also attractive for lithium neo-conquistadors “because it costs about $2,000 to $3,800 a ton to extract lithium from brine, compared with $4,000 to $6,000 a ton in Australia, where lithium is mined from rock.” Capital cost for exploration and construction is lower in brine extraction than hard rock extraction due to the different locations of brine lakes and hard rock lithium reserves: “A hard rock project in a remote mountain location with limited access to transportation and energy infrastructure is going to require a lot more money in the exploration budget than a salar in flat terrain…with well-established mining roads and a line to the electrical grid.” In terms of quality, Salar de Atacama “has the best quality reserves of lithium in terms of lithium to potassium concentration as well as low magnesium to lithium ratio.”

The low-cost and high-grade lithium brine deposits have spelled doom for the indigenous people living in the Atacama Salt Flats (AFSs). While lithium brine extraction is economically viable for capitalists, it has deleterious effects on water availability and is therefore, injurious to the social metabolism of indigenous communities. In lithium brine extraction, “up to 95 per cent of the extracted brine water is lost to evaporation and not recovered”. Furthermore, to extract a ton of lithium from brine, 500,000 gallons of water is required. The two companies, Albemarle and SQM, operating in Salar de Atacama have been given “licences to extract almost 2,000 litres of brine per second.” Besides brine water, mining companies “need the fresh water to clean machinery and pipes, and also to produce an auxiliary product from the brine – potash – which is used as a fertiliser.” The use of fresh water by mining companies is indicated by the fact that between 2000 and 2015, the amount of water that was extracted from Atacama was 21% greater than the flow of water to that area.

According to a report produced by the Observatory of Mining Conflicts of Latin America (translated from Spanish), “The greatest socio-environmental impact of lithium mining lies in the indiscriminate expenditure of water for the evaporation of brines and the production of the necessary tasks. Considering that the Atacama salt flat is located in one of the most arid regions in the world, the Atacama desert, the large-scale extraction of water and the basic processing of lithium brines generates severe damage to the fragile ecosystems that depend on those sources.” In the same report, it is written that “the communities originating from the high Andean salt flats suffer serious environmental damage due to the indiscriminate and poorly controlled extraction from the hydro-saline deposits of the salt flats, thus reinforcing their historic place of marginalization, exploitation and subordination.”

This indicates that water scarcity is not a localized phenomenon, restricted to a mere depletion in water levels. Rather, water scarcity contributes to a generalized impoverishment of indigenous people and drastically degrades their everyday living. Degeneration of existential conditions happens, inter alia, through the degradation of soil and vegetation covers. In the Atacama region, indigenous collectivities grow quinoa and look after llamas. For the growth of quinoa plants, an evenly moist soil is required and for herding llamas, it is necessary that there be an adequate vegetation cover on which they can feed. But lithium operations have undermined both these prerequisites and School of Sustainability at Arizona State University reports that “An expansion of lithium brine mining area of one square kilometre was found to correspond to a significant decrease in the average level of vegetation and in soil moisture.”

Through the deliberate disorganization of traditional occupational configurations, lithium companies are able to culturally colonize and proletarianize the spiritual and agro-pastoral practices of communal indigeneity. In the international value chains of lithium, the utter subjugation of indigenous people to the deformed logics of e-mobility is cruelly concealed and as said by the Plurinational Observatory of Andean Salares (translated from Spanish), “The incessant production of disposable electronic devices and the growing market for electric cars for the energy transition of countries in the global north…is becoming today the main threat to the subsistence of any form of life in the basins that host these [lithium] mining deposits”.

Chilean indigenous people have not acquiesced to the economically destructive and culturally catastrophic operations of mining corporations and have reacted strongly to lithium imperialism. In 2019, indigenous people protested against the water-intensive mechanisms of lithium brine extraction and the state, in response, paradoxically charged some communities for “water robbery”. The protests were initially triggered by the underhand dealings of SQM in which “the Chilean economic development agency CORFO signed a contract with SQM that enabled the company to triple its lithium extraction over the coming years and extended its mining access to the Atacama until 2030.” The tripling of lithium extraction till 2030 raised SQM’s lithium extraction quota to 350,000 tons. It is not entirely coincidental that a month after the agreement, Eduardo Bitran, head of CORFO, met with Tesla to propose “a project to Tesla in which SQM would provide brine, the raw material from which lithium is produced, to the carmaker for refining into battery component lithium hydroxide in Chile.”

It was in opposition to this intricate complex of lithium imperialism that indigenous people protested. These protests smoothly synchronized with the larger anti-neoliberal protests occurring in Chile and bolstered the indigenous-working class alliance. But this working class-indigenous movement was soon suppressed by the Chilean state which, in order to stabilize neoliberalism and lithium imperialism, cracked down on protests through rapid detentions, declaration of a state of emergency and the deployment of more than 9,000 soldiers. Because of the protection provided by the state, Ricardo Ramos, the CEO of SQM, was able to say that the protests won’t “be a strong issue in our business goals in the medium and long term.” He further added that “We are going to deliver our products to our customers according to our previous forecast despite the situation in Chile,”. From Ramos’s statement, we discern that there exists a structural arrangement for the cementing of lithium imperialism: companies like SQM economically exploit and culturally hegemonize lithium-rich areas; indigenous people combatively confront the predatory mechanisms of these companies; the Chilean state ultimately intervenes in order to regularize mining operations through the violent deactivation of protests.

While it may seem that the 2019 protest against lithium extraction was a spontaneous eruption of anger, it is necessary that we briefly examine the historical background against which it took place. Apart from signing a shady deal without any consultation, SQM “has been investigated for several cases of tax evasion, money laundering and illegal campaign-funding. In a major public scandal in 2014, politicians from across the spectrum were found to have received major sums of money to look after the company’s interests.” SQM also has a dubious distinction of causing major conflicts and in 2007, for example, there was a skirmish between the company and the Toconao community. Increased extraction of water from unauthorized wells and the contamination of water sources by sewage discharge were the contributory causes behind the SQM-Toconao conflict. Albemarle too has been progressing in its march towards class struggle-free lithium imperialism and in 2017 CORFO amended the corporation’s agreement through which Albemarle got “sufficient lithium to produce over 80,000 MT annually of technical and battery grade lithium salts over the next 27 years at its expanding battery grade manufacturing facilities in La Negra, Antofagasta.”

The rapid ramping up of lithium production by two companies in Chile has successfully benefited major electronic companies such as Samsung, Apple and Panasonic. In the automobile sector, Toyota, General Motors, Tesla, Volkswagen and BMW are some of the companies reaping economic advantages of the lithium sources of Chile. Figure 1 and 2 depict the multiplex and labyrinthine circuit of lithium in the international market. To satiate the vampire-like thirst of different companies for lithium, there has been a global increase in production and the role of Chile in catering to the lithium hunger of “white gold rush” is indicated by the contemporaneous expansion of Chilean lithium output with world lithium output: “The value of Chile’s lithium carbonate production rose to US$200 million by 2007, to US$500 million by 2012 and to more than US$800 million by 2017. It exceeded US$1 billion in 2018. There was a parallel surge in the value of world first-stage lithium output— reaching US$484 million in 2007, US$998 million by 2013 and US$2865 million in 2017.”

Figure 1, Source: Washington Post, “Indigenous people are left poor as tech world takes lithium from under their feet“

Figure 2, Source: Danwatch, “There’s probably Chilean lithium behind the screen you’re reading this on”

With the demand for lithium expected to grow in the global market, indigenous people and the working class would start encountering greater difficulties in sustaining themselves as indigenous ecosystems are efficiently eradicated and labor productivity is ruthlessly increased. During the Fastmarkets’ 11th Lithium Supply and Markets Conference in Santiago, “Producers Albemarle, SQM and Tianqi [which has a 23.77% stake in SQM]… agreed that flexibility in production remains vital for addressing diverse industrial and technological challenges.” This was a colloquial way of saying that workers need to be ready to be exploited, discarded and denigrated as mere commodities. For the indigenous people in Chile, life would be wrung economically dry as energy transition occurs in the Global North and magnificent Tesla vehicles silently operate on their blood-stained lithium batteries.

We need to remember that this dystopia of EVs parasitically procuring lithium from the open veins of Chile is avoidable and as said by Thea Riofrancos, “A world buzzing with hundreds of millions of Teslas (or worse, e-Escalades), made with materials rapaciously extracted without the consent of local communities, manufactured under a repressive labor regime in polluting factories — in other words, a world not unlike our own, but powered by wind and sun — is not an inevitability.” To move away from such lithium imperialism, we need to listen to the smothered voices of the Global South. An economic-ecological model based upon the anti-imperialist foundations of the Global South is radically different from capitalist models of extraction. Instead of conceptualizing a “development alternative”, the oppressed masses of the Global South imagine an “alternative to development”. In the interstices of this “alternative to development”, one can locate the seeds of resistance to lithium imperialism.