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Mesa seeks alliances
José Antonio Aruquipa
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President calls on opposition leaders to overcome crisis.

Possible protests against a package of economic cutbacks, regional demands that threaten the Constitutional Assembly planned for 2005 and the possibility of an economic blockade caused by the oil companies’ fear of approval of the hydrocarbons law — have obliged President Carlos Mesa to ask for the support of parties and political leaders that he recently described as "discredited" and "debased."

"We are facing strong tensions, we are facing an explosion of new demands in the midst of an extraordinarily important scenario like the Constitutional Assembly," Mesa said after learning the results of the Dec. 5 municipal elections and hours before he called several national and regional leaders to his office to ask for their support.

The winners of the municipal elections were independents, while traditional parties like the right-wing Nationalist Revolutionary Movement, the Nationalist Democratic Action (ADN) and the social democratic Movement of the Revolutionary Left (MIR) were practically wiped off the electoral map.

The president met with former presidents Jaime Paz (1989-93) and Jorge Quiroga (2001-2002) and at least three re-elected mayors to create an institutional alliance that could serve as a contention wall at the time of "making decisions for the good of the country," according to Minister of the Presidency José Galindo.

The reasons for Mesa’s concerns lie, paradoxically, in the overwhelming support his government obtained in the July 18 referendum to define a new hydrocarbons policy, the results of which were interpreted by Mesa as backing to "decide our future in the shortest term possible."

Oil companies "concerned"

The result of this process, however, now threatens to turn into a poisoned fruit for the president.

The 15 oil companies that extract gas and petroleum, backed by 76 joint-venture contracts, have labeled a draft hydrocarbons law under debate in the Congress "a confiscation". The bill was presented by the Commission of Economic Development of the Chamber of Deputies based on the interpretations that the government and parliamentarians made of "the mandate of the referendum."

The oil companies refuse to accept article 5 of the new law — approved Nov. 18 — that establishes the "obligatory" signing of new contracts of extraction and sale of hydrocarbons.

The "concern" of the companies has generated international pressures that could lead to an economic blockade if the new law does not provide "legal stability."

Since October, when Congress began debating the new law, emissaries of the United Status and Brazil — countries of origin of some of the oil companies that operate in Bolivia — and officials of international financial organizations have visited Mesa to remind him that Bolivia could lose foreign financial aid if it does not approve a "rational" measure.

Oil company officials even threatened to file international lawsuits if Congress persisted in maintaining the obligatory character of signing new exploration and drilling contracts under new regulations that also imply an increase in royalties paid to the state. Currently, the companies only pay 18 percent of their income.

In the same period, US Assistant Secretary of State for the Andean region, Charles Shapiro, warned after meeting with Mesa that the new measure could bring "complications for us (the United States)" and said that the Bolivian Congress "should evaluate the consequences, the impact of the new law."

US ambassador to Bolivia, David Greenlee, said on Dec. 13 that US companies have suspended their investment until the definitive text of the new hydrocarbons law is known.

Economic crisis

Mesa is also overwhelmed by an economic crisis that still has not been resolved as well as regional conflicts in the oil-producing departments of Santa Cruz and Tarija, which are threatening to call their own "referendum on autonomy."

2004 will close with a deficit, despite an increase in exports due more to international demand than to government planning, according to Fundación Milenio, Müller & Asociados.

The fiscal deficit is calculated in 503.7 million bolivianos (US$63 million), 23.1 percent of the restructured debt is overdue, unemployment exceeds 14 percent, the external and internal debt continues to grow and foreign investment is paralyzed, according to Milenio.

Alter holding evaluation meetings with officials of the International Monetary Fund (IMF), the government began to leake news of possible fuel price increases.

Ángel Villacorta, national leader of transport companies, warned that the government is preparing a "gasolinazo," or an increase in gasoline prices, diesel and liquid gas. He announced a series of protests against what his sector considers "at attack against the people." Teachers and public sector health workers also announced marches and the blocking of roads due to the fact that the government foresees a possible freezing of salaries in these sectors in 2005.

Against the wall

In the midst of a climate of growing conflict and faced with a wave of rumors about a military coup in the run-up to the municipal elections, Presidency Minister Galindo said that Mesa felt that discontented political sectors sought to put him "against the wall" in a war to wear him down.

These political sectors are identified with former President Gonzalo Sánchez de Lozada (1993-97 and 2002-2003) and those who fear political trials opened against the former president and his ex-ministers.

Deputy and leader of coca producers Evo Morales denounced that "interests of the oligarchy" were behind the requests by Santa Cruz for autonomy. These interests were preparing an uprising to stem his presidential aspirations and stop the trial against Sánchez de Lozada, he added.

His statements came in the midst of a series of dynamite attacks that altered the climate that existed in the run-up to the municipal elections, apparently aimed at intimidating officials of the executive branch and the armed forces in accelerating Mesa’s resignation.

In the meantime, national and regional leaders have all offered their support to the president to hold a Constitutional Assembly next year but they have also made it clear that it is Mesa, as president, who makes and executes decisions, even though it could affect his popularity which has now declined to 50 percent, according to surveys by Grupo Fides, radio network of the Catholic Church.

"Water that stands still rots. President, make decisions," Paz Zamora warned Mesa.

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