BOLIVIA: First Challenges for New President

By Franz Chávez Reprint | | Print |

Franz Chávez

LA PAZ, Feb 7 2006 (IPS) - An indefinite strike at Bolivia’s flagship airline and a police rebellion were the first substantial challenges faced by Bolivian President Evo Morales, who took office just two weeks ago.

Businesspeople fear that Morales will be tempted to take over and nationalise Lloyd Aéreo Boliviano (LAB), as he talked about nationalisation before and during his campaign.

Others, meanwhile, are seeking a negotiated solution to the strike, which on Tuesday entered its sixth day. National and international flights have been cancelled, affecting thousands of passengers and causing millions of dollars in losses.

So far, Morales has only ordered an audit of the airline. Bolivian businessman Ernesto Asbún owns 50 percent plus one of the shares, and the rest are in the hands of pension funds.

The strike was instigated by the pilots, who complain of poor administration at LAB. In 1996 the airline was sold by the government of rightwing president Gonzalo Sánchez de Lozada (1993-1997 and 2002-2003) to VASP, a Brazilian firm owned by Wagner and Ulisses Canhedo, for five million dollars. It was then purchased by Asbún in late 2001.

Investigations by journalists found that when the airline was owned by the Canhedos, father and son, fixed-term deposits for 11 million dollars were made, shares in the subsidiary reservations and tickets company (SITA) were sold for 19 million dollars, and 123 million dollars in spare parts were sold, not to mention other operations which yielded far more than the five million dollars originally paid to the Bolivian state.

Now the pilots claim that the company’s total assets are only 200,000 dollars, when they should amount to around 90 million dollars.

These accusations have a particular significance in that they affect the new minister of defence, Walker San Miguel, who was a LAB executive before joining Morales’s cabinet.

The pilots have also pointed to LAB’s supposed interest in selling three airplanes to the Air Force – which depends on the ministry of Defence – for 12 million dollars, when the market value is only two million dollars.

On hearing of this accusation, government spokesman Alex Contreras said that Morales was carefully studying the matter, and did not rule out a change in defence minister if the situation were not cleared up.

On another front, Morales was able to ease the tension sparked by a group of police officers doing security work for government institutions and private firms.

Alleging corruption among the police brass, and inflamed by the suicide attempt of one of their number, apparently due to pressure from his superiors, the police staged an uprising.

Tempers cooled when the government promised to audit the financial resources administered by police chiefs, and to include them on a salary scale from which they had been excluded.

Evo Morales, an Aymara Indian and the leader of the Movement Towards Socialism, was elected president of Bolivia by an unprecedented 53.7 percent of the vote, representing the support of over one million people. One of the central planks of his campaign platform was the promise to eliminate corruption in public finances.

Once in power, his first act was to retire 24 officers from the upper echelons of the armed forces, who were accused of participating in a scandal involving the destruction of 28 Chinese missiles belonging to Bolivia, which were taken to the United States to be deactivated.

Carlos Laruta, a sociologist and director of the Centre for Farmers’ Development (CIPCA) in El Alto, told IPS that the first few weeks of Morales’s term are a time when “all sectors are looking on benevolently, a grace period when disagreements are overlooked, and there is hope for a gradual transition.”

“As changes occur, this grace period can turn into stronger support, or the first protests and demands can appear, because people have high hopes and they want a commensurate response,” he added.

The first effects of the change in leadership are apparently being felt beyond the country’s borders as well. A drop in the price of Spanish oil giant Repsol YPF’s stocks has been attributed to the designation of left-leaning journalist Andrés Soliz Rada as Bolivia’s new minister of hydrocarbons.

Soliz Rada, a vocal advocate of the nationalisation of Bolivia’s abundant natural gas resources, had accused Repsol YPF of registering Bolivian gas reserves that it holds in concession as the company’s own property on the New York Stock Exchange.

In response to the accusations, the company stressed that it “respects national and international laws” wherever it operates.

“I still can’t believe I’m the president,” says Morales, who admits that he is still unfamiliar with the customs and protocol of his new position. The former leader of the coca farmers union set off a flurry of media commentary by wearing a striped alpaca sweater when meeting with heads of state and government during a European tour as president-elect.

As a teenager, Morales travelled to La Paz with a student delegation from the mining town of Oruro. The youngsters were forced through seemingly endless hurdles of bureaucracy and red tape to meet with the Bolivian president at the time, the late Hugo Banzer, who held elected office from 1997 to 2001 after heading up a 1971-1978 military dictatorship.

“When I’m president, it won’t be hard to find me,” Morales reportedly commented to his classmates at the time.

True to his Aymara indigenous traditions, the doors of the government house open at 5:00 AM every day.

Last Friday, the Bolivian Congress granted the new leader full powers to undertake reforms of the state apparatus, constitute a 16-member cabinet, and create presidential delegations aimed at bringing the government into closer contact with the country’s nearly nine million citizens.