Al-Ahram Weekly Online   23 - 29 June 2005
Issue No. 748
Published in Cairo by AL-AHRAM established in 1875

'Nationalise now'

Bolivia has a brand new president, but the people's struggle against privatisation continues, writes Faiza Rady

"Until we get an answer we are going to keep marching, because there are no jobs, lots of hunger and we still don't have answers -- even with this new clown," says Sanet Pardo, a demonstrator in the Bolivian capital La Paz. The "new clown" in question is highly respected 49-year-old Supreme Court Justice Eduardo Rodriguez Velze, who was sworn in as president of Bolivia following the resignation of US-backed President Carlos Mesa on 9 June.

Bolivia's people's movement, which calls for the nationalisation of the gas industry, brought the country to a standstill staging massive demonstrations. The move prompted Mesa's resignation. "This is as far as it can go," he declared.

Rodriguez faced his first challenge during a recent parliamentary session. On Thursday, he asked parliament to support his decision to hold early elections, but received no clear-cut response. Evo Morales, the charismatic leader of the Movement Towards Socialism, described parliament's dilly-dallying as yet another provocation for the Bolivian people, whose demands include the call to hold early elections.

Rodriguez, who was third in line for the presidency, acceded to the top job by default when both heads of parliament declined to rule the troubled country. Rodriguez is Bolivia's third president in 20 months.

After four weeks of civil strife, it looks like life has returned to normal. In the rich eastern provinces, protesters left the gas fields they were occupying. Cross-country traffic resumed as more than 100 roadblocks were lifted, and tens of thousands of marchers went home.

Nevertheless, the stakes are high and tension between the protest movement and Bolivia's political and business elites remains palpable. The protesters are calling for the nationalisation of the country's rich gas reserves -- the second largest in the world and which are estimated to be worth some $120 billion.

In addition to recouping the nation's wealth, the protesters want a constituent assembly to grant equitable representation to the mostly poor and disenfranchised indigenous people who make up 65 per cent of the population.

A country of statistical extremes, landlocked Bolivia has the largest proportion of indigenous peoples in the region. With an annual per capita income of $890, it is also South America's poorest country.

Over and above forcing the resignation of President Carlos Mesa, the people's movement aims to dismantle the neo-liberal economic system that has dramatically increased the gap between the haves and have-nots.

Since President Victor Paz Estenssoro started liberalising the economy in 1985, privatisation of the public sector resulted in widespread unemployment and abject poverty. A byproduct of privatisation, downsizing in the country's main industry -- the tin sector -- led to the loss of 25,000 jobs since the early days of economic reforms. Other industries disappeared altogether. Unable to compete against the dumping of cheaper subsidised foreign imports, Bolivia's fragile industrial base was rapidly dismantled in the 1990s.

While the industrial sector has all but collapsed, the agricultural sector is also at risk. Bolivia is one of the world's largest producers of coca, the raw material for cocaine. A government-imposed crop eradication programme, which is conditional on US aid, has angered many of the country's poorest farmers whose income depends on coca production.

Impoverished and unemployed in the wake of 20 years of economic "reform", Bolivian peasants and indigenous peoples organised at the grassroots level and started fighting back in April 2000. In what became known as the "water war in Cochabamba", NGOs led a successful struggle against the US multinational Bechtel, whose control of the local water concession led to soaring water prices. In the end, the grassroots coalition forced the mighty multinational to pack up and leave.

But the "water war" did not end there. In 2004, the movement waged another, possibly more important struggle against the French multinational Suez-Lyonnaise. The company eventually took over the water markets of La Paz and El Alto, under the guise of Aguas del Illimani SA (AISA).

Privatisation came at a high cost. In El-Alto alone, 40,000 destitute families were denied access to potable water, while other neighbourhoods were hit with price increases reaching up to 600 per cent. Things came to a head when the Mesa administration granted AISA important tax breaks to guarantee the company a 12 per cent profit margin. At that point, the people's movement organised a coalition of some 600 NGOs, pressuring the government to repeal AISA's concession. A three-day general strike in the capital eventually forced President Mesa's hand. He finally complied, and on 11 January 2005 AISA closed its doors.

The "water war" set a precedent for the "gas war", an ongoing struggle for the control of Bolivia's economy. "The gas reserves represent national wealth," says activist Oscar Olivera, "but as long as this wealth belongs to the capitalists, what could be a source of rebirth for the productive capacity of the nation is, for now, only a source of profits."

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