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Andean Group - April 2014 (ISSN 1741-4466)

MINING: Mining bill proves contentious

Hopes for swift approval of a new mining bill unveiled by President Evo Morales in March [RA-14-03] were premature. Late-March protests by mining cooperatives (cooperativistas) over congressional changes made to the bill resulted in two deaths and forced President Morales to replace his mining minister. The incident has raised questions about the fate of the legislation, considered key to boosting Bolivia’s stalled mining sector.

The proposed legislation, the fruit of three years of talks between the government, the private sector, unions and cooperativistas, would replace the existing mining framework, approved in 1997 under the government led by Gonzalo Sánchez de Lozada (1993-1997; 2002-2003).

The cooperativistas specifically objected to an amendment to Article 151 of the proposed bill, which appeared to authorise cooperatives to sign independent mining contracts with private companies. On 29 March, the lower chamber of the plurinational legislature struck this out on the grounds that it was unconstitutional, stipulating that only the Bolivian State is in fact authorised to sign contracts with private investors to exploit natural resources. This led the cooperativistas to announce protests and stage road blockades in five of Bolivia’s nine regions - La Paz, Oruro, Potosí, Sucre and Cochabamba.

On 31 March over 50 people were injured (most of them police officers) in clashes between the protesters and police, while two cooperativistas died from gunshot wounds. The incident forced the executive to the table, no doubt mindful of threats made by Alejandro Santos, leader of the Federación de Cooperativas Mineras (Fencomin), which represents the cooperativistas, that “just as we brought Evo to power, so too can we remove him”. As well as replacing Mining Minister Mario Virreira (who had been in the post since January 2012 and as such was held responsible for the mining bill) with a trusted MAS ally, César Navarro (see below), the Morales team also held talks with Fencomin, announcing a compromise over Art. 51 on 21 April.

The compromise agreement establishes that cooperatives can form mixed companies with the state mining company, Corporación Minera de Bolivia (Comibol), but not with foreign or local private companies. At the time of writing, the government had yet to clarify whether it intended to make good on its earlier proposal to redraw the entire mining bill from scratch.

Cooperatives

According to figures from the deputy minister of mining cooperatives cited in the government mouthpiece Cambio on 25 April, as of end December 2013 there were 1,642 mining cooperatives in Bolivia, providing 114,920 jobs in the mining sector, or 88% of the total 130,932 jobs in the sector.

According to the same report, 7,902 people are employed by the state company Comibol, with the rest (8,110) employed by the private sector.

On 6 April Interior Minister Carlos Romero told reporters that in 2013, cooperatives contributed US$31.7m in mining royalties to treasury coffers (or 23% of the total), while the private sector contributed US$94.5m (70%) and the state US$8.4m (6%).

Profits

According to Bolivia’s deputy minister for the budget and fiscal accountability, Jaime Durán Chuquimia, state companies registered total profits of B$6.6bn (US$959m) in 2013, up from B$6.4bn (US$932m) in 2012 and B$69m (US$9.9m) in 2005. Of the 23 state companies currently operating in the country (up from six in 2005), Durán said that the state oil company YPFB accounted for an overwhelming 96.7% of the earnings, contributing B$6.4bn (US$932m). This was followed by the state mining company, Corporación Minera de Bolivia (Comibol), with B$297m (US$43m); the national electricity company Empresa Nacional de Electricidad (Ende), with B$187m (US$27m); and the mining company, Metalúrgica Vinto, with B$34m (US$5m).

Morales faces military revolt

Calls for reform of the armed forces (FFAA) from lesser-ranking military officials are proving an unexpected challenge for President Morales. To date 719 non-commissioned officers (NCOs) from the navy, army and air-force have been removed for “sedition and disrespect”.

The unrest began on 21 April after the president of Bolivia’s national association of NCOs and sergeants of the armed forces (ASCINALSS), NCO Johnny Gil Leniz, called a national strike in response to a decision announced the previous day by Defence Minister Rubén Saavedra to fire four NCOs who had been calling for internal reform of the FFAA. The sacked officials (two air force officials, one army official and a naval officer), had presented a proposal on 3 April citing the need to address “discrimination within the FFAA” against the mostly indigenous NCOs.

Among other things, the proposal calls for NCOs to be allowed the same educational opportunities as their seniors; for the ranks of NCO and sergeant to be replaced with the position of “technical officer”; as well as health and other benefits. The striking officers are now also calling for the ejected officials to be reinstated. The FFAA commander-in-chief, Admiral Víctor Baldivieso, on 24 April stated that “discrimination is not a pretext for sedition and promoting a coup d’état”.

There are currently 9,666 NCOs, while the latest (2014) Military Balance from the UK’s International Institute for Strategic Studies puts the total number of FFAA members at 46,000.

While Baldivieso, who assumed the post in December 2013, might have mentioned a “coup”, the Morales government is unlikely concerned that this “rebellion” will spread up the ranks.

Baldivieso’s predecessor, General Edwin de la Fuente, had raised eyebrows with his description of the FFAA as “socialist”, “anti-capitalist” and “anti-imperialist”, echoing comments made in November 2010 by then-head of the FFAA, General Antonio Cueto, and which were then repeated by his successor, General Tito Gandarillas, during his inauguration in January 2012. (The co-opting of the military by the government is characteristic of the regional left-wing integration bloc Alianza Bolivariana para los Pueblos de Nuestra América [Alba] set up by the late Venezuelan president Hugo Chávez [1999-2013]).

Instead the Morales government appeared more concerned that the unrest would spread to other sectors – particularly the police, which in 2012 staged revolts in demand of better wages and conditions. The day after Gil announced the strike, the government announced a deal with the national police association (ANSSCLAPOL) to increase daily food expenses for police officers to B$7 (US$1), up from B$4.50 (US$0.65).

While some organisations allied to the government like the Confederación Nacional de Mujeres Campesinas, Indígenas Originarias-Bartolina Sisa (CNMCIO-BS), one of the three main campesino groups, bought Saavedra’s line that the political opposition was behind the unrest, others like the main workers’ union confederation, Central Obrera Boliviana (COB), called for a solution to the conflict because “it is putting democracy at risk”. Meanwhile Albino García Choque, the leader of the national confederation of cooperatives (Concobol), expressed support for the NCOs.

  • Navarro

On 8 April Bolivia's Morales named César Navarro, the presidential delegate for the 2025 patriotic agenda, as his new mining minister. A former MAS deputy, Navarro, who previously served as deputy minister for coordination with social movements (2010-2013), is a trusted Morales ally. His appointment got a mixed response, however. While some highlighted his experience in dealing with social conflicts as useful, Senator Efraín Condori (MAS) questioned his lack of sectoral experience.

  • TA president sacked

On 10 April four of seven magistrates on Bolivia’s environmental court (Tribunal Agro-ambiental [TA]) voted to sack their president, Bernardo Huarachi, for inefficiency, replacing him with Judge Lucio Fuentes. Along with the plurinational constitutional court (TC), the supreme justice court (CSJ) and the council of magistrates (the judicial oversight body), the TA is one of Bolivia’s top courts. The move is the latest sign of crisis in the judiciary after the TC and CSJ presidents, Ruddy Flores and Gonzalo Hurtado respectively, stepped down in February [RA-14-02]. The justices were among the 54 senior judges elected in brand new national elections for the judiciary, held in October 2011.

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