Latin American Politics - Latin American political blog of Thiago de Aragão

Bolivia: Evo Morales tries to contain indigenous mobilizations

Bolivian President, Evo Morales, has intensified his campaign against new indigenous protests that are heading for La Paz. The purpose of the mobilizations is, once again, demonstrate dissatisfaction with the decision of the Bolivian government to build a road on the Indian Territory Isiboro Secure National Park (Tipnis), which is an indigenous nature reserve. Trying to win support from public opinion, Morales flew along with the local and foreign journalists over Tipnis, showing the benefits of the work on this ecological reserve. The road that the government intends to build on Tipnis is designed to unite the central region of Cochabamba with the Amazon region of Beni, through half of the Tipnis population, rejects the proposal.
To resolve this impasse, Morales is in holding a referendum to be held on May 10. The vote will decide whether the indigenous will approve or not the construction of the road on Tipnis. Despite the initiatives of the Bolivian president to keep dialogue channels open and consult his primary voter base – the indigenous movement – there is strong resistances to approve the project driven by the executive branch.

Keywords: Alan Garcia Argentina argentinean government argentinean politics Barack Obama and Latin America Bolivia bolivian crisis bolivian economy bolivian government bolivian politics Brazil Brazilian economy Brazilian Government Brazilian politics Chilean elections Chilean politics civil war in bolivia Colombia colombian government colombian politics Cristina Kirchner dilma rousseff Ecuador Evo Morales financial crisis Henrique Meirelles Hugo Chavez Latin America Latin American politics Lula Mercosur natural gas oil in venezuela Paraguay Peru Peruvian economy peruvian government Peruvian politics political analysis Rafael Correa Thiago de Aragão Venezuela Venezuelan economy venezuelan government Venezuelan politics

Bolivia: ATPDEA suspension calls for new markets

The US House of Representatives approved the extension of the Andean Trade Promotion and Drug Eradication Act (ATPDEA) to Colombia, Ecuador, Peru and Bolivia, despite demands by President George W. Bush that benefits to Bolivians be suspended.

The ATPDEA allows tax-free Bolivian exports into the US market. It is part of American incentives aimed at Andean nations cooperating in the war on drug trafficking.

Bush’s request to exclude any benefits to Bolivia came as a response to the expulsion of the US ambassador to La Paz, Philip Goldberg, at the summit of the institutional crisis, three weeks ago.

According to the local press, the benefits will be suspended regardless of the House approval. Sources from the US Embassy in La Paz said that the situation will not change unless the US president issues a resolution to the contrary. Faced with this imminent loss of economic benefits, the government headed by Evo Morales will probably intensify dialogue with Venezuela, Mexico and Brazil, which are all potential markets in the region.

Bolivia: Government and Opposition decides to talk

The dialogue between Bolivian President, Evo Morales and the governors of the Departments of Santa Cruz, Tarija, Beni, Pando and Chuquisaca advanced in a positive way. Nevertheless, the two sides did not discuss the most controversial themes. A member of Morales’s cabinet gave the information’s.

After more than six hours of negotiations, Morales left the meeting room to have lunch. He left all other members of the discussion group inside the room. According to information gathered, the dynamics of the meeting allowed both sides to explain their version of the story and to defend their points of view.

In the best terms, a true solution won`t be found. I believe the closer to a solution will be a paralysation of the crisis. This means that the conflict will not be solved, since the differences in points of view are very antagonist, but a stronger escalation will be suspended, for a while.

Chavez: Troops to Bolivia ready to go

Venezuelan President, Hugo Chavez, mobilized troops to intervene in the Bolivian crisis. Sources in which President Lula had access, informed that while Chavez was participating in the Union of South American Nations Coup (UNASUL), discussing a solution for the Bolivian crisis, his troops were getting ready to the eventuality of going to Bolivia.

Chavez considers unacceptable any concessions to the opposition of the Morales government. He offered a direct intervention in order to establish order in the provinces of Santa Cruz, Beni, Pando and Tarija. Chavez initiative could cause a reaction at the Bolivian Armed Forces that, through its commandant, General Luis Trigo, announced that any intervention from a foreign country in Bolivia would not be welcome. Considered to be a serious man with good relations to Brazilian authorities, Trigo could be a problem to Chavez’s intervention plans and would be no surprise if he were taken away from his position as Commandant of the Army.

Monday, Chavez attacked General Trigo accusing him of disobeying President Morales and compared him to the Venezuelan army official that helped prepare the coup d’état against Chavez in 2002. The offer proposed by Chavez, even in the field of hypothesis, will bring more tension to the Bolivian crisis.

Latest on the Bolivian Crisis

The President of the Bolivian Senate, Oscar Ortiz, pleads for the mediation of the international community in order to put an end on the institutional crisis. Ortiz suggested that President Evo Morales could perform an “auto coup d’état”. He said that Morales is capable of changing democratic rules and bending the laws in order to perpetuate in power.

Morales’s party, MAS (Movement to Socialism) approved the referendum in the National Assembly without the participation of the opposition representatives.

The chances of an “auto coup d’état” as suggested by Ortiz are relatively small. Considering the conversation with some sources in the country, I believe that chance of a short-term escalation of the conflict is diminished, though not completely gone. Also, the chance of peace between both sides is not near as well. A “pause” in the current conflict could be achieved, though a further act from President Morales that infuriates opposition leaders will cause the crisis to pick up exactly from the point it stopped. In other words, we can see a civil war closer and closer.

Bolivian Crisis could lead to Civil War

This institutional crisis aggravated after the approval of the Constitutional Reform. To ratify it, it is necessary a popular referendum. Since President Evo Morales’s adversaries did not participated in the session in which the National Assembly ratified the Reform, they do not recognize it.

Besides that, the opposition have heavy criticisms in relation to the destination that the government is giving to the Direct Tax on Hydrocarbons (IDH). Evo Morales shifted the tax that was sent to the provinces derived from the gas and oil explorations, to a Grant for people over 60 years of age. These resources are considered by the opposition provinces (Beni, Pando, Tarija and Santa Cruz) to be crucial for their financial balances.

In addition to all that, these provinces, known as “Media Luna” are determined to acquire their autonomy from the La Paz government.

Based on that situation, we have three possible scenarios:

1. Civil War between government and opposition: Today it is not possible to affirm that this will occur. Nevertheless, the escalation of conflicts and the behaviour of the opposition indicate that this is a scenario that cannot be disregarded. In absolute terms, this possibility is still very small. It is the last consequence for both sides. Among the several problems that this catastrophic event would bring, we are able to identify sensible points in which Brazil and other South American nations would encounter:

a. The distribution of natural gas would be completely affected. The gas pipes would be among the main targets of opposition groups, with the intention to gather the attention of the international community. Besides, the efforts to guarantee the distribution logistics would be insufficient. In Brazil, industries related to food, beverage and ceramics would be heavily affected in the Southwest and Southern regions.

b. In Argentina, the situation would be even worse. The industries in the Buenos Aires regions are very dependent on the Bolivian gas. Besides, Argentina is an important gas supplier to Uruguay and Chile. In Chile, a significant amount of the industries are heavily dependent on the Bolivian gas distributed by Argentina.

c. Politically, many countries would be directly affected. Brazil would have to deal with approximately 400 thousand refugees. Argentina would have to accommodate approximately 100 thousand in the Jujuy, border region.

d. In the eventuality of a civil war, there would be the risk that the conflict could GO beyond Bolivian borders. Indigenous population that sees in Evo Morales their leader inhabits the borer with Peru. With the heavy local influence of Peruvian opposition leader, Ollanta Humala, He could use the situation to try to destabilize Alan Garcia’s administration.

e. There is an important military agreement between Bolivia and Venezuela. The agreement foresees and eventual Venezuelan intervention in the case of a domestic threatening situation that puts risk to Morales and the Bolivian government.

2. Maintaining the division in the country: This is the most possible scenario. Due to the intense control Morales exerts over social movements, as well as the legitimacy He earned in the last referendum, indicates that the opposition does not have enough strength to cause the downfall of Morales. On the other hand, the deepening of the Bolivian crisis suggests that the opposition will not retreat in its quest for autonomy. The instability environment is more apt to be the ruling situation for a while. The profiles of the opposition and the government are of total antagonism. The causes defended by each of the sides make it virtually impossible to find a middle term. Recently, the president of the Civic Committee of Tarija Said that the only way out would be to adopt the “German model, one east and one West”. In case Morales manages to perpetuate in power, than we can expect a scenario closer to the first one.

3. Deal between government and opposition. The chance of this happening today is close to zero. The bellicose environment installed in Bolivia shows that the country is closer to an institutional collapse than to a deal between the two parts. The dialogue is practically inexistent. The deal is far from happening since there is no structure or basis for an eventual deal. Brazil could be the one to architect a deal of this natures, but it has been the characteristic of this government not to participate in situations like this. The argumentation used by the Brazilian Foreign Affairs is that this is a domestic issue in Bolivia. In case the tensions escalate a little more, the repercussions and prejudices will easily affect all the region and especially Brazil.

Bolivia: Violence and deep institutional crisis

A intense conflict between people opposite to president Evo Morales and the police is occurring now.

The increase in the number of people contrary to Morale`s government is increasing by the minute. Many are contrary to the taxes applied to the exploration of gas and oil reserves which are not returned to the population.

The class has resulted in several wounded and one dead up to the moment. Also, the protesters were against the visit of Venezuelan President Hugo Chavez alongside the Argentine President Cristina Kirchner. Due to the incidents, both presidents just cancelled their visit to Bolivia.

The situation is deteriorating minute by minute. Sources confirmed that the opposition as well as the autonomy groups are seeing this protests as an opportunity to deepen their attacks against Morales.

Soon I will be receiving more information from one of the opposition leaders, and posting on this web blog.

Santa Cruz de la Sierra legitimizes institutional crisis

Nobody should be surprised at the result of the referendum on autonomy held on Sunday, May 04, in the province of Santa Cruz de la Sierra, Bolivia. The highly anticipated “Yes” victory, to be confirmed by the end of the week when the vote’s official results are due to be released, has led to reactions by Bolivia’s central government and by the Santa Cruz government too, which did not expect a different result.

The legitimization granted by popular vote –around 86 per cent of the Santa Cruz population approved of the autonomy– will entail significant political changes in the nation. Among the foreseen changes, the province will start collecting its own taxes, controlling oil and gas extraction and sales, and controlling its administration without the need for previous authorization from the central government in La Paz.

The aspects surrounding oil and gas extraction and sales are the biggest igniters of fights between provincial and central government. Highly dependent on gas explored in Santa Cruz, the Bolivian government would not be able to bear its expenses if the provincial government were to revaluate the administrative maintenance of these commodities.

The economic side of the fight between separatists and central government is undoubtedly the most important aspect in this institutional crisis. This is due to a matter of survival, as La Paz will not be able to bear the financial losses that an autonomy process would unfold in the country. All the policies planned by president Evo Morales and, most of all, by his MAS (Movement towards Socialism) party, would fall down and hardly be able to develop.

Dialogue is the first weapon Morales intends to use to nullify the impact of Sunday’s vote. The president will try to lean on a relatively low turnout during the election to bring the opposition back to the negotiation table.

The recurring failure to find a negotiated way out suggests how difficult it will be for the government to resume conversations with autonomists. Apparently, both sides are tired of talks and, at each new round, differences become sharper and the unfriendly climate exacerbates. Morales has been held hostage by the radicalization imposed by his MAS party. Sandwiched between an extremist party and an organized and articulated opposition, the president constantly resorts to a dialogue that has been unfruitful.

From now on, Santa Cruz will act as an example of Bolivia’s new political map. The overwhelming electoral victory in favor of autonomy will spread to the three other provinces upholding the same ideals – Beni, Pando and Tarija. The problem is really likely to aggravate even further.

Risk of civil war is not a new threat in Bolivia. This risk is becoming increasingly stronger, especially when political events such as Sunday’s referendum are not responded to by the central government in a likewise fashion. From now on, the following aspects will be critical: the willingness of Santa Cruz leaders to engage in dialogue; the MAS stance, as Morales is highly influenced by his party; and the impact from the Santa Cruz referendum result on the provinces of Beni, Pando and Tarija.

By reviewing these aspects, one can draw a more likely forecast of what can happen in the country in the short and medium term. In a certain way, an institutional damage has been done. It will be very difficult for Morales to remedy this damage if you take into account his history of solving conflicts with the opposition. However, the Bolivian president has all the information necessary to prevent this movement from spreading and becoming even stronger. Above all, he will count on mediation (until now not effective) by the Organization of American States (OAS) and the so-called “friends of Bolivia” (Argentina, Brazil and Colombia) against total rupture and in favor of maintaining territorial integrity and the rule of law

Even though uncertainty looms, some conclusions can already be drawn. National unity will remain seriously affected for a long time; the nation’s economy will become even more vulnerable due to the dispute over the ownership of its main natural resource; and the nationalization process will be changed for companies based in the Santa Cruz province. The local government will claim its authority to decide on whether to legitimize such nationalizations.

For Brazil, the deterioration of governability in Bolivia tends to bring about at least two adverse impacts: natural gas supplies will be severely harmed, as the gas imported by Brazil originates mostly from Santa Cruz; and the amount of refugees crossing the border to get shelter in Brazil would be a matter of concern. Any participation by Venezuela, which has a military support agreement in place with Bolivia, is another aspect increasing tensions in the region and likely to have a decisive weight upon how the situation escalates.

It is certain that the approval of the autonomy proposal in Santa Cruz has caused reactions outside Bolivia too. Worried with the potential consequences of the Santa Cruz referendum, Argentina, Brazil and Colombia (the “friends of Bolivia”) have released a note on Monday (May 05) expressing their “certainty that, more than ever, it is necessary to readily put in place a frank and comprehensive dialogue among Bolivia’s main political actors, aiming at preserving Bolivia’s democratic institutionalism and territorial integrity, as well as facing the difficulties affecting the nation.” In line with the OAS efforts, the three nations will work during the following weeks in order for any implementation of the autonomy statute approved on the weekend to occur “with full respect to the rule of law and the nation’s unity.”

Bolivia – March 2008

The people’s referendum on the new Constitution, scheduled for May 04, has been suspended indefinitely. The reason came from the National Electoral Commission, which put the blame on not having enough time to prepare the referendum with the required electoral guarantees. There are no technical, operating, legal or political conditions for the referendum to take place. The commission’s decision is a blow against Bolivian president Evo Morales’ plans to implement a new Constitution that, according to him, will give greater voice to Indigenous peoples, women and the poor. However, opponents of the constitution reform understand that it would place Indigenous peoples above the rest of the Bolivian population.

As an energy supplier to both Brazil and Argentina, Bolivia is proving a failure. As he nationalized several facilities, Evo Morales promised that natural gas extraction would become more professional and that the waste caused by previous governments and administrators would cease. Almost two years later, the country cannot export the amounts agreed upon with Brazil and Argentina, and might even not be able to provide enough natural gas for their domestic consumption.

The Bolivian government has launched a plan to save energy in the country, but has ruled out the possibility of importing petroleum-liquefied gas during winter. The proposal to save energy was presented by the hydrocarbon minister Carlos Villegas. It is called “National Plan of Energy Efficiency” or “energy revolution.”

Bolivia – January 2008

Bolivian president Evo Morales has completed two years in power but has little to celebrate. Due to the deadlock in drafting the new Constitution, the nation is experiencing a political crisis that has split the country. On one side, Morales’s allies; on the other, his opponents who reject the new Magna Carta. Out of the nine departments, five have decreed autonomy from the central government. As a result, he ends his second year in office having to administer a climate of polarization. For many political analysts, you could have seen this scenario coming. In his first year, Morales nationalized the hydrocarbons industry, breaching contracts and scaring new investment away from Bolivia. With that decision, oil companies started operating as state subsidiaries. Despite this climate, his allies play the current government up. His party, the MAS (Movement towards Socialism), boasts that the country was not controlled by the market in the last two years.

However, Bolivians are still fully dependent on natural gas exports, even though they do not have the necessary oil exploration infrastructure – they rely on technical assistance from companies such as Venezuelan state-owned oil company PDVSA. The government has announced that will honor the contracts concerning natural gas supply to Argentina and Brazil. According to the Brazilian ambassador in La Paz, Maurício Dorfler, the current output level is enough to ensure supply while meeting the domestic demand. Today, Bolivia supplies approximately 30 million cubic meters of natural gas to Petrobras on a daily basis.

Welcome! Latin America is becoming consistently more important for the world. As the region becomes more stable, the world sees Latin America as a potential business area. In order to understand te potential Latin America has to offer, the world must understand the unique dynamics that the local politics function. This blog already exists in Portuguese since 2005 and is widely read. I believe it can be an important instrument to understand this amazing region. Suggestions, criticisms and opinions are welcome. + learn more

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