Weekly Report - 9 March 2004

Strong pressure from business groups has led President Carlos Mesa to backtrack on several key features of his economic policy package, launched in early February and designed to prune a fiscal deficit which last year reached 8.6% of GDP. The main casualty was a temporary tax on net assets of more than US$50,000. The strongest resistance to the package came from the business associations of Santa Cruz, who are emerging as determined enemies of what they perceive as `regressive' regional dominance by La Paz and the western highlands.