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Judgment Day for Bolivia's Embattled President

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Council On Hemispheric Affairs
Monitoring Political, Economic and Diplomatic Issues Affecting the Western Hemisphere

Memorandum to the Press 05.29

Word Count: 750
Friday, 11 March 2005
Weekend Release

Judgment Day for
Bolivia's Embattled President

• Bolivia’s Congress met on Tuesday March 8 and unanimously decided not to accept President Carlos Mesa’s resignation.

• Nevertheless, the political position of President Mesa has become untenable due to incessant squabbling over the country’s natural gas reserves and the prospect of more bloody street demonstrations.

• Mesa has no other option but to negotiate with his nation’s dissidents.

• A make or break decision for Mesa’s seventeen-month presidency is at stake because, unless he is able to develop a game plan with the full participation of campesinos and the indigenous, he cannot effectively rule.

• Mesa cannot resort to military support because of the explosive impact it would have on the nation.

The future of Carlos Mesa’s seventeen-month presidency met its first test on March 8, as the Bolivian Congress decided unanimously to refuse the president’s unexpected resignation. Mesa’s decision comes at a time of unparalleled civil unrest in this South American country. Recent nationwide blockades, instigated by various segments of the political spectrum, have crippled the Andean nation’s economy. Consequently, Mesa’s government has been left with few options to deflate the increasingly polarized domestic environment. “I cannot continue to govern besieged by a national blockage that strangles the country,” Mesa declared in a statement on March 6. His impromptu decision shortly afterward to offer his resignation to Congress represented a final attempt to end the political quagmire that has engulfed his impoverished country. The outcome of Mesa’s political gamble was in his favor, at least temporarily, as legislators refused to allow him to step down -- but it is one thing to have the politicians on your side rather than the citizenry.

Squabble Over Bolivia’s Natural Gas Reserves

In October 2003 President Gonzalo Sánchez de Lozada was forced from office by demonstrators opposed to his neoliberal policies and Mesa, his vice president, ascended to the presidency. A former journalist and political independent, as president Mesa has faced unabated challenges to his domestic agenda. The exploitation of the country’s vast natural gas reserves has been the principal cause of civil unrest over the last two years and represented the main impetus behind his decision to tender his resignation. He wanted to treat the gas as a commercial product while the country’s largely indigenous population looked upon it as a national legacy.

By attempting to exercise greater government control over Bolivia’s domestic resources, the embattled president has been torn between two polarized sectors of Bolivian society. On the one hand, regional leaders in the country’s conservative and prosperous Santa Cruz and Tarija provinces have demanded greater local autonomy over their region’s lucrative natural gas reserves. These demands have fuelled secessionist tendencies within Bolivia’s eastern provinces, which have systematically weakened Mesa’s attempts to bolster national unity behind his domestic policies. Similarly, the nation's various indigenous groups, in particular Movimiento al Socialismo led by influential cocalero leader Evo Morales, have called for greater government control over the country’s resources, and are frustrated with Mesa’s tempered approach towards foreign multinational corporations.

In particular, indigenous groups have called for a 50% tax on foreign firms wishing to exploit Bolivia’s natural gas reserves. However, such demands have been rejected as unworkable by Mesa, who has sought but failed to obtain the ratification of a progressive but purely business-oriented Hydrocarbons Law that would both expand the government’s role and foster foreign investment within the natural gas industry.

Between a Rock and a Hard Place

Faced with polarized opposition to his policies, Mesa has been forced to walk a fine line between warring factions while attempting to resolve the country’s dire economic situation. Although this tenuous balancing act almost failed, and still could, Bolivia continues to descend into an unending cycle of political in-fighting. “I am not ready to prolong this shameful comedy we are in,” stated Mesa in his March 6 declaration.

By offering to resign, Mesa astutely gambled his political future on the outcome of last Tuesday’s vote in the Bolivian Congress. By rejecting his resignation, the president’s mandate and his policy agenda will be strengthened, if only briefly. As Mesa again seeks to achieve unity through mildly progressive policies, Bolivia’s political stability is once more teetering on the brink of destruction, largely because modest measures have never brought the social changes the country so badly needs and which so many Bolivians want.

This analysis was prepared by Mark Scott, COHA Research Fellow.

March 11, 2005

The Council on Hemispheric Affairs, founded in 1975, is an independent, non-profit, non-partisan, tax-exempt research and information organization. It has been described on the Senate floor as being “one of the nation’s most respected bodies of scholars and policy makers.” For more information, please see our web page at www.coha.org; or contact our Washington offices by phone (202) 223-4975, fax (202) 223-4979, or email coha@coha.org.

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