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Coca Farmer Wins Bolivian Election: New President to Challenge Multinationals

by Anton FoekSpecial to CorpWatch
December 28th, 2005

cartoon by Khalil Bendib

Even oxygen is scarce in the Latin America’s poorest nation. Living at almost 16,000 feet above sea level, Bolivia’s red-cheeked inhabitants have more red blood-cells than people who live at sea level, and enormous chests with huge lungs to capture as much of the available oxygen as possible from the thin air. Many of them hope that the December 18 election of Eva Morales will bring a breath of fresh air.

Because most visitors are unaccustomed to its rarified atmosphere, Bolivia wins all soccer matches on its home turf. "Of course we beat world champion Brazil playing soccer," former president Carlos Mesa says in his la Paz office, "but on all other fronts we lose."

The biggest losers had been ordinary Bolivians, who, with the lowest living standard in Latin America, have inadequate health, education, and social care. Half of the country’s 9 million people attempt to survive on less than $2 a day; 30 percent on less than $1. Hardest hit are the nations’s Indians who comprise 60 percent of the population, giving Bolivia the continent’s largest per capita indigenous population.

But earlier this month it was the turn of the indigenous population to win and it was Washington that got the breath knocked out of it. Evo Morales, an Aymara Indian with a bootstrap story of childhood poverty and the backing of much of the nation’s poor and indigenous population, scored a solid win in his race for president. Morales is part of a wave of leftists taking power in Latin America and rejecting Washington’s neoliberal economic policies.

Morales’s election will affect the crucial battle to control Bolivia’s resources. In the past, as former president Mesa noted, the winners in Bolivia have been transnational corporations from Brazil, Argentina, the United States, China and Mexico, and Europe. Petrobras of Brazil, Repsol YPF of Spain, the French Total, British Gas & British Petroleum and scores of others among them the Royal Dutch Shell have been granted broad access to Bolivia’s resources only to take most of the profits home.

And those profits have been vast, for as poor as Bolivia is in oxygen, it is still rich in tin reserves, silver, zinc, timber, water, oil, and natural gas. Chief among these resources is gas, perhaps 30-50 trillion cubic feet, and Mesa is convinced that this reserves alone could boost Bolivia into prosperity and propel a far more equitable distribution of wealth.

That is something that Mesa never achieved in his short term in the presidency. He came to power in October 2003 after a wave of demonstrations left almost 100 dead and forced his predecessor to flee the country. Less than two years later, in March 2005, he was driven from office by his inability to meet the demands of either the indigenous movements, the business sector, or wealthy provinces looking for more autonomy. Since then Supreme Court president Eduardo Rodriguez has held a tenuous grip on the highest office, succeeding Carlos Mesa who had resigned among mass protests and road blockades that paralyzed the country for weeks.

Neoliberalism Rejected

The current election revolved around two main contenders: Jorge Quiroga, who admitted defeat when his opponent cleared the 50 percent mark necessary to avoid a runoff, who is seen as a defender of the interests of the rich, a class dominated by the "white" business elites, descendants of the Spaniards. The other major candidate, Evo Morales, was Quiroga’s polar opposite.


Evo Morales

The ordinary people of Bolivia venerate Evo Morales in part because he is one of them. He is proudly indigenous, he is a former coca farmer, and he is the son of a tin miner. For a model of what not to do to enrich local elites and foreign corporations, Morales need look no further than the tin industry which shaped his childhood.

“Once we had best quality tin and we had that also in the largest quantities. That resulted in one single Bolivian family – the Patinos - becoming one of the ten richest in the world. But we as a people, we have remained the poorest of the poor," says Eduardo Butrageno, who runs a shuttle service between the high and lower parts of la Paz.

It is there that the country’s class structure is made visible, if in reverse. The higher up the mountain you live here, the lower your rent. El Alto, the poor suburb almost 3,000 feet higher than La Paz, is an enclave in its own right, with locally elected representatives who talk to the goverment in La Paz and the offical capital of Sucre. Thick mud walled constructions serve as often one bedroom houses, where families live, cook, sleep, and keep their domestic animals. There is little or no electricity and the gas trucks are never on time. The dusty streets through el Alto --the only road into la Paz-- lead along make-shift social centers, cinemas and local bars and give tourists a view into a part of Bolivia they rarely see.

That dichotomy between high land and low extends throughout the country. The country’s frigid highlands are dominated by impoverished Indians, while the European class lives in the relatively warm and wealthy eastern plains which lead to the Amazon.

Morales and his main opponent in the election personify that division. Jorge Quiroga is a "white," conservative, U.S.-educated former World Bank and International Monetary Fund consultant. He has called for a "zero coca" policy and supports the U.S. economic model of free trade.

Morales is a son of highlands who advocates indigenous rights and a more socialist economic model. Four of his six siblings died in infancy and he never finished high school.

Morales grew up highland region rich in tin at the altitude of 15,600 feet above sea level will bone-chillingly low temperatures. Tin mining accounts for about 45 percent of the country’s total export earnings and Bolivia is the world's largest producer. When the mines closed in the 1970s and 1980s, many of poor highland families like Morales’s lost their livings, migrated to the lowlands and turned to coca production.

Having seen the effects of mining first hand, Morales now calls for nationalizing the industry. "Everyone knows the tales of miners who in their 35th year had already wasted away with lung-silicosis and died under degrading situations," says Patricio Mena, secretary general of the trade union of miners. After ten years of mine-labor, silicosis is inevitable.

Limited funds for health care and hospital space increase the suffering of hundreds if not thousands of patients at the hospital of the Cerro Rico, in the mine province of Potosi. There, two adult men share one sleeping place for lack of beds. Their lungs full with mine-dust, both have trouble breathing. "That’s the way it is here," says in-house physician Roberto Aguillar. "Because of lack of funds, there is, for the time being, no other way."

"Those are the working conditions of the miners of Cerro Rico," says a representative in a social center in el Alto, "We must now learn from the errors of our past. Those can't be tolerated anymore. We must build and reconstruct a new Bolivia. It is time to change. It's time for Evo. We must understand that, especially here and now."

Wherever Morales campaigned, a large crowd gathered yelling his first name. Evo, Evo, Evo. In a typical stop at Cochabamba, he grabbed a bullhorn and informed the audience that the Bush administration brands him as a coca farmer whereas, "I only defend the interests of the farmers. In 2002 they stopped my candidacy, but this time it's no longer possible. We have been using coca for more than three centuries and we will use it another three centuries. Tell me, who is the terrorist: he who destroys the crops with pesticides or the defender of your crops?"

The audience went wild.

Decriminalizing the cultivation and domestic consumption of coca is one of the issues on which Morales built his campaign and his popularity. Many Indians chew coca leaf leaves as part of traditionally religious rituals, to stem hunger, and help them cope with back-breaking work in high altitudes. But Bolivia’s "sacred leaf" is also America’s demon drug: The coca leaf can be refined into cocaine and crack, powerful drugs that feed an international market controlled by unsavory traffickers. Even though Morales opposes international cocaine trafficking, a confrontation with Washington was inevitable: Coca exports are valued at us $500 million per year; Bolivia is one of the largest exporters; the United States is the largest importer; and Washington spends annually $1.3 billion-- in vain-- for coca plant-eradication and replacement by coffee or tea. Farmers, however, would rather plant coca than coffee as is it their only reasonable source of income.

The other issue that animated Morales’s campaign was the role of foreign corporations and governments, especially the U.S. which has imposed neoliberal "reforms" that opened the doors to corporations bent on appropriating control of Bolivia’s national resources. "I will vote for Evo," says Gloria Ullca, a 31-year old high school teacher in La Paz, who is deeply concerned about the country’s immediate future, "although I do not approve of his tactics and methods, but we need fundamental changes if we want to save this country from chaos and further exploitation by foreign countries and multinationals."

One of the most infamous foreign corporate incursions was by Bechtel Corporation of California. Its attempt to privatize Bolivia’s water industry galvanized a movement and sparked "a water war." Confrontations between the government and demonstrators resulted in the arrest and deaths of protesters, the shutting down of major highways for months, and eventually a victory for the movement to keep water from being controlled by a profit-driving foreign corporation. Bechtel (with a yearly revenue of $24 billion) is now suing the Bolivian government (with an annual budget of $2.7 billion) for damages up to $25 million.

Gas

While water is of domestic importance, it is Bolivia’s vast supply of natural gas that has drawn the most foreign investment. Except for Venezuela, Bolivia has the largest natural gas reserves in the region, with an estimated value of more than $50 billion.

At the end of 2003, the Bolivian government had expressed interest in selling the total natural gas reserves to U.S. and Mexican companies. The deal, which included processing and transport, would have generated US$2 billion, but instead sparked widespread civil unrest as it was worth ate least ten times as much, according to newspapers and other sources that criticized the deal. Widely perceived as a give-away of Bolivia’s birthright to foreign corporations, the sale fell through after mass demonstrations, strikes, and other signs of civil unrest rendered it politically untenable.

Trade unions and local interest groups including Morales and his supporters demanded that foreign oil and gas companies, such as Petrobras from Brazil and Spanish Repsol YPF, not get control of reserves that could finally bring local wealth. And they measured that affluence simply: in running water, electricity, sufficient health care, schools and security.

"Shame on our governments and our politicians. We have no gas, whereas some 280 million cubic feet is exported each and every day to neighboring countries like Brazil and Argentina. No hay gas. We are still colonized." said Gloria Ullca. The theme of colonization is a common source of outrage, fueled by the irony that local people have almost no gas for cooking, and gas canisters are hard to find and expensive.

If the multinationals get their way, it will become even easier for gas to leave land-locked Bolivia. A multi-billion dollar gas-pipeline is under construction to carry well over 1 billion cubic feet per day from the Bolivian Chaco to Brazil’s Sao Paulo region, Latin America largest industrial center with a population of 22 million. The pipeline is financed under "Equator Principles" a new set of voluntary rules that commit financial institutions to socially responsible and environmentally sound financing and planning. The big players include Royal Dutch Shell as well as the Brazilian giant Petrobras, the Spanish Repsol YPF and the bankrupt Enron of Texas whose overseas assets are being held by the newly incorporated International Corporation.

This project, too, faces accusations of foreign exploitation. The corporations involved had pledged to compensate indigenous populations for the destruction that gas pipeline construction caused to their homelands. When they failed to deliver on the land promises and environmental guarantees, protesters blocked access to construction camps. Environmental groups are still waiting for a financial settlement worth $30 million.

Another gas pipeline is under construction from Tarija in the South through Paraguay on to Buenos Aires in Argentina, where another 20 million people live. Revenues are estimated at US$42 million per year for the treasury, almost as much as coca exports.

Roads

These projects are part of an industrial boom is reshaping Bolivia–especially in the south around the region of Tarija. Highways from the far north to the far south of the continent and from east to west are under construction, along with scores of bridges, gas pipelines, oil conducts, airports, inland harbors suitable for deep sea-vessels. The multi-disciplined projects are financed by the Inter American Development Bank with monies from commercial banks all over the world. International corporations are hungrily eyeing the Tarija region and assessing its potential.

Bert van Barneveldt, chief executive officer of the Dutch engineering company DHV and long-time resident of Bolivia points to a map in his office across the U.S. embassy in la Paz. '"Look," he says "and see for yourself how the country is right in the center of South America. You'll also note a distinctive process of integration. People are looking and finding jobs here. The significance of the process is that the days of isolation are over."

Indeed, part of the impetus for the projects is coming from as far away as China where a changing diet and a construction boom are forcing Beijing to look abroad. The meat, soy, and timber that Brazil and the other Amazonian countries produce in abundant are attracting the Chinese market.

Bolivia is the crossroads of these mega-projects and the country promises to become the economic and trade center with Tarija as its core. Thousands of migrant workers from neighboring countries are flocking into the region lured by higher salaries and the prospect of a better future for themselves and their children.

"Part of the population sees the projects as a blessing because the new highways mean faster access to hospitals and schools." says van Barneveldt. "More trade and economic activities make a country prosper. It is an end to their isolation. In a way you may speak of reducing poverty by constructing these projects."

But there are also dangers. Most of the continent’s projects run right through the shrinking rainforests and many fear environmental damage will be extreme despite the protections of the Equator Principles. If history is any guide, and the carelessness and greed that have marked other development schemes occur, the environment may suffer and the projects may spark the kind of civil unrest that has brought down governments. There is the distinct possibility that only the international corporations will end up reaping the benefits of the mega-projects, while ordinary Bolivians pay the costs in disruption of their culture and their environment, only to be left in poverty without even the gas and electricity that are fueled the change.

After Morales’s December 18 victory, Bolivia’s impoverished population is turning to him to answer questions about whether and how Bolivia can eradicate extreme poverty that plagues them and to begin distributing the country’s wealth. If he is to be successful, he must bring together extremes of class, history, culture, and race and geography, which until now have shown few signs of reconciliation.