Germany and Bolivia entered into a joint venture for the industrial use of lithium, Reuters reported Dec. 12.

Bolivian state-firm YLB forged a partnership with private German company ACI Systems to develop its Uyuni salt flat in Andes, one of the globe's largest deposits. The deal will also cover the construction of a lithium hydroxide plant as well as the establishment of a factory for electric vehicle batteries in Bolivia.

The joint venture aims to produce up to 40,000 tons of lithium hydroxide per annum, starting 2022, over a period of 70 years.

Wolfgang Schmutz, CEO of ACI Systems' parent ACI Group, said over 80% of the lithium from the venture would be exported to Germany.

Meanwhile, ACI Systems is said to be in lithium supply talks with a major German carmaker, although the company declined to comment.

The private-public partnership will help reduce Germany's dependence on the Asian market for a key raw material used for battery cell production.

"Germany should become a leading location for battery cell production," German Economy Minister Peter Altmaier said.

The country earmarked €1 billion to support domestic companies' efforts to produce battery cells for electric vehicles. The move is also aimed at protecting jobs that are at risk due to the transition from combustion engines.

ACI Systems is untested in lithium but it topped rival bids from China, Russia and Canada, according to the report.