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Bolivia's Political Crisis

This was Bolivia in May and June 2005: roadblocks and sometimes violent street protests that have choked off fuel supplies to the country's main cities. Much of the country's economy was brought to a standstill; labor and indigenous Indian groups demanded nationalization of the oill and gas industry. Business interests reacted to the protests by demanding autonomy for energy-rich eastern provinces. All these are the elements of a political crisis that forced a Bolivian president to resign for the second time in two years.

President Carlos Mesa relinquished the presidency on June 6th, saying he could no longer lead Bolivia in the face of the unrest. Mr. Mesa rose to power in 2003 after bloody popular protests forced the resignation of President Gonzalo Sanchez de Losada. But Mr. Mesa proved no more able than his predecessor to hold on to Bolivia's highest office in the face of popular discontent.

Michael Shifter of the Washington-based Inter-American dialogue says South America's poorest country faces major challenges even though it has had a string of democratically elected governments in the past two decades.

Mr. Shifter says, "[Bolivia] has confronted serious crisis recently because of the lack of ability of the government, really, to respond to the growing demands and expectations of groups that have been excluded from the political system previously, primarily indigenous groups. Bolivia is 60% indigenous.

The World Bank says more than 60% of Bolivia's population lives in poverty. 2003 statistics showed the country's annual per capita income at 900 dollars a year, a decline since the late 1990s.

Indigenous and labor groups have spearheaded the protest movement. This movement gained new strength in May when a law increasing taxes on foreign oil companies went into effect. The law calls for a 32 % tax on foreign oil companies in addition to an existing 18% royalty tax they already on the books.. However, protest leaders thought the law did not go far enough. They demanded nationalization of the entire oil and gas industry and the redistribution of its profits to the country's poor.

One of the best-known protest leaders is legislator Evo Morales, coca grower, a member of congress, and former presidential candidate. Again, Michael Shifter: "He is somebody who first really represented the coca growers and then, he has become more a symbol of the broader movement, that not only includes coca growers, but also those who are protesting economic policies, the export of natural gas and really anti-globalization."

Michael Shifter says Evo Morales demonstrated the extent of his influence over the protesters when on June 9th, Congress chose Supreme Court Chief Eduardo Rodriguez as interim President. Mr. Shifter says protesters suspended their movement at Mr. Morales' request in a show of goodwill towards the new president.

Upon taking office, Mr. Rodriguez said Bolivians must work to, in his words, restore the republic. However, he may be facing another challenge. The protest movement has generated a backlash in Santa Cruz and some of Bolivia's other energy-rich eastern provinces. Pro-business groups are their demanding more autonomy from the central government.

The current unrest has not gone unnoticed around the Western Hemisphere and some argue that Bolivia has now become part of a regional political chess game. Stephen Donehoo is an analyst at Kissinger, McLarty and Associates, a Washington-based consulting firm. He notes that Venezuela's leftist government has made a name for itself as a leading critic of the United States and of classical liberal policies. Mr.Donehoo argues that Venezuela is financing leftist movements in several Latin American countries, including Bolivia.

Mr. Donehoo says, "I am convinced that Venezuela is helping fuel feelings of unhappiness with democracy's ability to deliver resources, health, education in all these countries."

In fact, US Assistant Secretary of State Roger Noriega expressed his concern last month over what he called the role of Venezuelan President Hugo Chavez in the Bolivian crisis. But Venezuelan Foreign Minister Ali Rodriguez dismissed the claim, demanding that Mr. Noriega back up his allegations and saying that Venezuela scrupulously respects Bolivia's sovereignty.

In fact, Venezuelan President Chavez says that if anything, it is U.S., supported free market and free trade policies that have brought Bolivian tensions close to the boiling point.

Meanwhile, interim President Rodriguez says he has no intention of completing Carlos Mesa's term, which runs until 2007. Last week, the Bolivian Congress began a debate on whether to hold early general elections late this year in a bid to end the political crisis.

This report was originally broadcast on VOA News Now's Focus program. For other Focus reports, click here