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BOLIVIA
Wave of discontents
José Antonio Aruquipa
1/13/2005
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Explosive situation caused by rising fuel prices and a bow to US pressure.

Bolivian President Carlos Mesa is facing a rising tide of protest over a controversial year-end move that increased fuel prices.

Mesa decided on Dec. 31 to increase the tax on fuels between 10 and 23 percent, a move opponents say is a massive blow to the poor in a country where 960,000 people are unemployed and two out of every 10 families survive on US$1 daily.

The increase in fuel prices, which is having a ripple effect across the economy, is compounded by promises Mesa made that he would "not ask more from those who have nothing left to sacrifice." He made that promise in February 2004, five months after taking over from his predecessor, Gonzalo Sánchez de Lozada (1993-97 and 2002-2003), who was forced to resign and flee to the United States.

Demands for Mesa’s resignation

Labor unions and regional organizations called on Mesa to resign, and public transportation unions called a 24-hour strike on Jan. 4 to protest the price hike. The strike effectively closed down Bolivia for a day. Unions carried out violent strikes during the first week of January in several areas of the country.

Jaime Solares, executive secretary of the Bolivian Workers’ Central (COB), said Mesa should resign because "he only represents a continuation of Sánchez de Lozada’s government."

Solares added that "Mesa has returned to applying neoliberal measures. If he cannot govern for the people and prefers to govern for the transnational companies, he should pack his bags and go."

The administration justified the price hike, arguing that the move was necessary to stop the smuggling of diesel fuel across the borders to neighboring countries where it is more expensive.

Mesa’s government had subsidized the price of gasoline, diesel and liquid natural gas until the end of December as part of an effort to maintain prices stable in the face of rising international fuel costs. The subsidy, paid to fuel distribution companies, cost the state approximately $60 million annually.

Ángel Villacorta, executive secretary of the National Confederation of Transportation Unions, said the government chose "the easiest and simplest path ... without making a dent in the smuggling" of fuel.

"Unfortunately, when one does nothing, one has no arguments. This talk about stopping smuggling (with the tax increase) is an absurd excuse. Smuggling will continue because the prices in other countries are very high," Villacorta said.

José Céspedes, a leader of the Eastern Agricultural Chamber (CAO) in the department of Santa Cruz, said the Mesa government has does nothing more than "hit workers and businesspeople over and over again."

The increase in fuel prices is seen within the context of a series of moves by Mesa that Bolivians believe have been adopted because of pressure from the United States and international organizations.

Hydrocarbons law

Mesa attempted to pass a new hydrocarbons law that satisfied the demands of transnational companies pumping oil and natural gas, and approve a bilateral accord with the United States that would exempt US citizens from the jurisdiction of the International Criminal Court.

These moves were opposed by congressional deputy Evo Morales, the president’s informal ally and head of the Movement to Socialism (MAS) party, as well as by human rights, labor and peasant organizations.

The new hydrocarbon law is stuck in Congress, where lawmakers appear unlikely to approve it soon despite a favorable referendum last July and complaints by the administration that foot-dragging is costing the country $100 million annually.

The legal uncertainty over the new hydrocarbons law is complicated by threats from petroleum companies opposed to signing new contracts, which is stipulated in Article 5 of the draft legislation. Under the existing law, hydrocarbon companies pay royalties equivalent to 18 percent of their revenue. The new law would increase the amount to 50 percent. The petroleum companies, which claim that the new law is an attack of "juridical security" and a violation of their contracts, threaten to take their case to international tribunals.

Immunity to US citizens

On another front, Mesa is also dealing with a backlash generated by the Chamber of Deputies’ approval of an agreement that grants immunity to US citizens in the International Criminal Court. The court was created to try war crimes, crimes against humanity and genocide. The agreement was originally signed by Sánchez de Lozada in May 2003 and approved by the Senate last year.

Presidency Minister José Galindo warned that there would be "no aid" from the United States if lawmakers failed to approve the agreement.

Morales immediately said that the government’s attempt to create fear about the loss of US aid was nothing more than "blackmail." He said Bolivia could not support immunity to US citizens "who can be hired killers and paramilitaries."

"Dignity cannot be traded and is not for sale to the highest bidder for international aid," Morales said. He promised that the MAS "would fight in the Congress and the streets" against immunity for US citizens.

Monsignor Jesús Juárez, archbishop of El Alto, said that "when there is solidarity between peoples, aid is unconditional. If they tell you that you will lose aid if you do not sign this treaty or that agreement, it sounds like blackmail."


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