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Politics in Bolivia

Bolivia is a country located in the central part of South America. As one of
the poorest countries in the region, Bolivia entered the XXI century
carrying a vast population in extreme poverty. Bolivia has also faced the
fate of those countries that don't have a shoreline, which has had a
significant negative impact on its commerce, economy and overall development.

The most outstanding issue affecting the social, economic and political
dimensions of Bolivia's life is clearly the problem of the exportation of
Bolivia's natural gas reserves. This is a very complex problem with deeply rooted social, political and historical elements.

To understand the current situation in Bolivia we must go back to the IXX
century. Bolivia lost a significant amount of territory in a War against
Chile during the last part of the IXX century, thus losing access to the
Pacific Ocean. Peru, another South American country, tried to help Bolivia,
fighting against Chile during this war. As a consequence Peru also lost a
significant amount of territory to Chile.

Since then Bolivia has tried to regain access to he Pacific Ocean by several
diplomatic means. Bolivia has unsuccessfully requested to Chile and Peru to
be given a peace of sovereign territory in the coast, including a corridor
that would allow Bolivians to connect to a peace of shoreline.

Bolivia feels today more than ever the disadvantage of not owning a
shoreline. Bolivia has vast deposits of natural gas, which they hope to
export to other countries such as U.S and Mexico. Bolivia has engaged in
negotiations with Peru and Chile in order to use a sea port in one of these
countries to ship the gas to foreign markets.

The previous Bolivian president Gonzalo Sanchez de Lozada formed a technical
team that evaluated the feasibility and benefits of a project that would use
a Peruvian or a Chilean sea port to export Bolivian gas. The project should
include a pipeline to be built between Bolivia and the sea-port to
transport the gas from the natural deposit. After an extended evaluation
this team recommended to use a Chilean port on basis of cost benefits. The
Bolivian government then accepted these recommendations and started to
engage in negotiations with Chilean companies.

After making public the intentions of exporting Bolivian gas through Chilean
facilities, the government faced a tremendous reaction from a significant
amount of the population and some political sectors of Bolivian congress.
The leader of the socialist movement, Evo Morales, called to other Bolivian
sectors to rise against government intentions to use Chilean ports to
export the Gas. Several labor and farmer unions joined the protests
around the country. The president was accused of having a secret agenda to
benefit Chilean business men. The protests also raised long standing issues
such as extreme poverty and social needs. An interesting aspect of these
protest was the feeling of outrage sparked on the population, due to the
fact that Chileans would be the ones that would benefit from Bolivian's
businesses. Bolivians believe that Chileans stole them the shoreline
territories in the IXX century and therefore refuse to do anything that
would benefit Chileans. There was a strong national sentiment against Chile
that forced the president to reconsider his decision, however, it was too
late and Sanchez de Lozada had to resign. Carlos Meza, the vice-president,
assumed the presidency of Bolivia.

Mesa called for a referendum in order to decide the faith of gas
exportation. In July 2004, Bolivians expressed through a referendum their
decision to export their reserves of natural gas through Peru. Current
president Mesa is till facing another problem, with regards to the amount
of tax that should be imposed over the companies in charge of the
extraction and transport of the natural gas. The government is pushing for
a conservative 18%, where Bolivian opposition groups don't want anything
less than 50%. Currently, President Mesa is asking congress to decide this
and other issues when they approve the new hydrocarbon?s law. The most
radical groups don't want to sell the gas and want to use it only for
domestic consumption, even though Bolivian gas reserves can easily supply
domestic and foreign consumption simultaneously.

It is very important to note the historical aspects that drove Bolivians to
the situation that they live today. There is a clear negative sentiment
against Chileans that has not been erased by more than a hundred years of
pacific coexistence. I believe that many Bolivians would argue that the
current situation of poverty and lack of progress that their country faces
today is greatly attributed to the lack of access to the Pacific Ocean. In
my opinion this also reflects the emotional nature of the Andes habitants,
whose decisions are greatly influenced by how they feel.

Besides this national sentiment, Bolivia is currently engaged with other South American countries in an integration process that would facilitate trade and commerce among Latin American countries. In December 8, 2004, Bolivia participated in a Summit held in Cusco-Peru. Twelve South American countries attended this summit and agreed to constitute a Community of South American Nations by signing a declaration. This community was born with the idea of improving a Latin American free trade zone, which will link the current members of Mercosur, the Andean Community and Chile. The declaration also mentions that the community has the objective of integrating the members at the social, economical and institutional levels. The integration in infrastructure involves physical, energy and communications aspects.