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BOLIVIA: AGREEMENT BRINGS TENUOUS END TO SOCIAL UNREST.

The Bolivian government and the labor organization Central Obrera Boliviana (COB) signed an agreement on May 10 that aims to end the social upheaval that has gripped the country for the past month. Already, however, the coca growers have warned they will continue their protests.

Interior Minister Guillermo Fortun said four ministers and the leadership of the COB signed the 15-point document, which includes a government promise to adjust the national minimum wage in 2002 and to set up working groups to discuss modifications to the free-market economic model that Bolivia has adhered to since 1985. The government also agreed to re- examine the anti-drug law and the process of privatization of state businesses.

The COB agreed to end its measures to pressure the government, calling off the planned general strike and the 190-km march from Oruro to La Paz.

COB leader Alberto Camacho said the agreement was a victory for neither the government nor the COB, but for the Bolivian people, since the struggle promotes the just demands of workers to improve their lives.

Labor Minister Jorge Pacheco said that "the favorable outcome of the negotiations is proof that Bolivians can find solutions to their problems within a process of working together."

Until the agreement was reached, the COB had refused to call off the march and had threatened to begin a hunger strike if the government did not respond to its demands.

Church backs call to rescind Ley 1.008

One particularly thorny issue is the controversial anti- drug law (Ley de la Coca y Sustancias Controladas, Ley 1.008). On May 4, Jesus Juarez, bishop of El Alto and vice president of the bishops conference (Conferencia Episcopal de Bolivia, CEB), said that the Catholic Church backed the call by campesinos to revise the drug law, and he called US opposition to such a modification interference in the internal affairs of Bolivia.

The government rejects any repeal of Ley 1.008, which went into effect in 1987 and which regulates the cultivation and sale of coca.

Opponents say the law, which was pushed through with pressure from the US Embassy, violates various constitutional rights of Bolivians. The US Embassy warned that any modification could affect US aid to the country.

Bishop Juarez said that "foreign countries are here to cooperate with Bolivia and not to try to dominate it, and many Bolivians feel that the policy of the embassy needs changing."

Juarez said that the position of the campesinos should be considered as part of an effort to solve the nation's economic and social crisis. The Catholic Church has offered to sponsor a national meeting with civil and political leaders to discuss such issues as the economic crisis, the battle against corruption, constitutional reforms, the 2002 elections, and the failure of the government to respond as it had promised to various sectors of society.

Meanwhile, the head of the organized coca growers, Deputy Evo Morales, threatened to resume roadblocks in the Chapare if the government does not begin by May 21 to fulfill commitments it made last April, especially to invest in social programs in the region.

Government sets up loan restructuring

In another controversial move, on May 4, the government announced creation of the Fondo Especial de Reactivacion Economic (FERE), which it said would help pull the country out of the deep economic recession and alleviate some of the problems causing the ongoing protests. FERE will target US$263 million to reactivate the productive sector and US$60 million to restructure the loans of small debtors over four years. The restructuring was hailed by businesses, but rejected by debtors.

Although Banzer said the FERE is "the economic flexibilization of a Bolivian model that is neither state capitalism nor free market," the small debtors were not impressed and said they would continue their protests.

Edgard Cardenas, representative of the debtors, said they want their debts forgiven, since restructuring will just add more interest to their already unpayable debts.

Finance Minister Jose Luis Lupo dismissed any debt forgiveness, saying the government cannot intervene in what is a private matter.

"If the debtors think they were taken advantage of, they will have to seek redress in the courts," said the minister.

But many businesspeople reacted favorably to the FERE. "It will allow the debts of the private sector to be reprogrammed and activate the economy, which will benefit all Bolivians," said Emilio Unzueta, president of the Asociacion de Bancos.

"Finally, business owners, who have suffered the worst effects of the recession, will be able to refinance their debts and get their factories and businesses going again," said businessman Carlos Calvo.

Some aspects of the president's plan set off calls for a return to the model of state-run businesses.

Banzer agreed on the need to modify the present economic model and said that Yacimientos Petroliferos Fiscales Bolivianos (YPFB) could learn from Petrobras in Brazil and PEMEX in Mexico.

But political analyst Irving Alcaraz said calls for changes in policy were politically motivated. "Those who long for the past are the unions that have lost force, stability, and many politicians are picking up the idea as a way to seduce the public with an eye on next year's general elections," he said. [Sources: Spanish news service EFE, 05/04/01, 05/06/01; La Opinion (Los Angeles), Notimex, 05/08/01; El Nuevo Herald (Miami), 05/11/01; Los Tiempos (Bolivia), 05/15/01]
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Publication:NotiSur - South American Political and Economic Affairs
Article Type:Brief Article
Geographic Code:3BOLI
Date:May 18, 2001
Words:902
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