Bolivia: Tension grows as opposition mobilizes and the army issues warning

Workers and farmers lead protests against controversial energy law in the west

Bolivia entered on Monday into a decisive week for its future, as social movements led by workers, farmers and the indigenous majority head to the capital, La Paz, to protest a controversial energy law voted by the Congress and the oil & gas rich eastern regions demand autonomy from the central power. To give to this delicate scenario a more dramatic outlook, the military issued a document warning demonstrators not to challenge the social order while President Carlos Mesa said he would resign if protests turn violent.

On Monday, protesters in the militant city of El Alto - overlooking the capital La Paz - begin an indefinite strike over the controversial energy law approved last week by Congress. The law sharply raises taxes on foreign oil companies exploiting Bolivia's largely untapped natural gas reserves of 53 trillion cubic feet, the second largest in Latin America. But groups representing the poor indigenous majority now want nationalization of gas and Congress dissolved.

The law has been also resisted by foreign groups operating in Bolivia as British Petroleum, Texaco, Petrobras (Brazil) and Repsol YPF (Spain), who threatened with a complete withdrawing of investments if turns effective. President Mesa neither signed nor vetoed the new legislation in an attempt to take a neutral stance on the controversy.

Ahead of the demonstrations organized by farmer groups and the leftist labour unions, Mesa said he would resign if protests turn violent. The embattled President also obtained a strong support from the military, which issued a document on Monday stating that its personnel were “alert to the development of the acts to secure respect to the social order and the legitimate power.”

But not only has the poor west risen against the government and the current institutions. In the oil & gas rich eastern regions, two provinces decided this weekend to hols a referendum on autonomy after Congress failed to agree last week on a referendum as promised. Santa Cruz de la Sierra, in the border with Brazil, and Tarija, in the border with Argentina, demand a tighten control over the resources they produce, which are collected by the central authorities in La Paz.

Santa Cruz threw Bolivia into a constitutional crisis last January with threats to break away, but tempered its demands after Mesa and Congress said they would work toward a process to give Bolivia's provinces more autonomy. But there are deep divisions between east and west on over how to do it, which could turn explosive in view of the current scenario.

For left-wing opposition leader Evo Morales, the gas law and the autonomy issue are linked. The prominent head of the Movement to Socialism said "Many oil companies are behind Santa Cruz's proposal because they think it will be easier to negotiate royalties with producing regions rather than with the Bolivian state.”

The government also blames the “eastern oligarchs” for being behind the demands, but its weakness prevents it from taking control of the situation in there. In today's Bolivia, South America's poorest nation, the poor west and the wealthy east have risen and the drama has just begun.