[Marxism] Soliz Rada: Bolivia's Nationalization on its Knees

[Greg McDonald <sabocat59@xxxxxxx>]

Bolivia's Nationalization on its Knees


http://www.zmag.org/content/showarticle.cfm?SectionID=52&ItemID=12482

by Andrés Soliz Rada; Rebelión; April 03, 2007

Sometimes the efforts of oppressed peoples to liberate themselves  
from imperial subjugation are confronted by direct, brutal violence  
like that used by the CIA to overthrow Jacobo Arbenz in Guatemala in  
1954 and Salvador Allende in Chile in 1973 or else by innoculating  
the virus of paralysis, disorientation and demoralization into the  
lifeblood of the movement for change as happened in Bolivia with the  
Revolution of 1952. The 1952 Revolution carried on calling itself  
revolutionary even after the US managed to abort the nationalization  
of the mines by blocking the installation of metal foundries, taking  
control of oil via the Davenport Code (1) and centralizing all  
official information in its embassy in La Paz .

This latter way marked the third oil nationalization (2)of May 1st  
2006. The oil companies appeared to obey the measure and even  
"accepted" the framework contract which converted them into service  
providers in such a way that YPFB(3) recovered ownership, possession  
and absolute control of underground resources. This time around, the  
emasculating virus was innoculated via the "innocent" Annexe F, by  
means of which the Operating Contracts were changed into Shared  
Production Contracts. Under the Operating Contracts the oil companies  
would pay to carry out exploration and exploitation activities in the  
name of YPFB using their own means, on their own account, at their  
own risk.

Under Shared Production the oil companies recover the right to  
include the value of their participation in oil transactions,  
including the gas reserves associated with export markets over which  
they have ownership rights, which they register first in their own  
accounts and later in the international stock markets.

With this antecedent, Petrobras (4) announced on March 31st this year  
that it was signing Shared Production Contracts in La Paz which  
allowed it to register the value of the reserves in the stock  
markets. As a result, the May 1st nationalization turned into a  
hollow shell, with the government having to limit itself to saying  
that it had obtained greater income via the sale of larger volumes of  
oil and gas.

It proposed, without success, that the formulas of Annexe F be made  
known to the Senate in closed session, that is to say behind the  
backs of the citizenry. It paralysed the trials for crimes of  
smuggling, tax evasion and fraud committed by the oil companies. It  
went on to show the new exports to Argentina as an end in itself and  
not as a necessary evil with the aim of using those resources for  
nation building. YPFB will not control the production chain and will  
not be able to promote the industrialization of hydrocarbons.

Thanks to this, Bolivia now has huge difficulties obliging the oil  
companies to supply the domestic market at lower prices than  
international prices. Via the construction of huge gas pipelines it  
will continue exporting raw materials destined for industry in  
Argentina and Brazil, so the interior regions of the country will  
continue to lack energy resources. Nor will it be able, through the  
guarantee of the value of the reserves, registered in favour of the  
foreign oil companies, to obtain the necessary loans to promote  
projects capable of transforming our economy.

Could Bolivia have followed another route and faced down the  
monstrous power of the oil companies backed up by imperial powers  
like the US, Britain, France and Spain, and too by international  
financial institutions like the World Bank, the Inter-American  
Development Bank and the Andean Development Corporation as well as  
the hundreds of non-governmental organizations that have got  
themselves key positions within Evo Morales MAS (5)? Why demand more  
radical behaviour of the first President to call himself indigenous  
than that demanded of Kirchner or Lula who, in the end, lead  
countries far better able to resist the New World Order led by that  
mess of fanaticism and dementia that is George Bush? Could he have  
chosen a course making national interest and dignity, set down in the  
Nationalization Decree, prevail with only the support of the Cuban  
government or the government of Chavez, one of whose economic bases  
is the consumption of Venezuelan oil by North America?

Possibly, the answer might be negative. Evo had few choices to do  
anything different than what he did with the oil contracts. On the  
other hand, he lost the chance to do something profoundly  
revolutionary. That consisted in telling the country the truth which  
would have strengthened his moral leadership of the excluded sectors  
of Latin America for whom he represents hope.

By not doing so he offers a desolating spectacle in which  the oil  
multinationals, neoliberal legislators who supported Hugo Banzer  
Suarez and Gonzalo Sanchez de Lozada (5), along with the leaders of  
MAS, call on the people to support Oil Contracts characterized by the  
sinister Annexe F and which, in the fundamentals, help maintain  
Bolivia's submission to the centres of world power.


Translation copyleft by Tortilla con Sal

Translator's notes
1. The Davenport Code was the name applied to legislation promulgated  
in 1956 offering concessionary terms to foreign (mostly US) oil  
companies. In 1969 President Alfredo Ovando Candia revoked the  
Davenport Code legislation. when his government nationalized Gulf Oil.
2. Shortly after Yacimientos Petrolíferos Fiscales Bolivianos was  
founded in 1936, General David Toro's government nationalized  
Standard Oil's holdings in Bolivia. The second nationalization was  
that of President Alfredo Ovando Candia in 1969.
3. Yacimientos Petrolíferos Fiscales Bolivianos - the State  
hydrocarbons company.
4. Petrobras although nominally Brazil's State oil company is owned  
mainly by foreign investors.
5. MAS - Movement Towards Socialism - is Evo Morales' political party.
6. Hugo Banzer Suarez, former Bolivian dictator (1971 to 1978) and  
also elected President (1997 to 2001). Gonzalo Sanchez de Losada was  
president twice from 1993 to 1997 and from 2002 until he was forced  
to flee the country after the 2003 uprisings against his oil and gas  
policies in favour of foreign multinational oil companies in which  
many dozens of protestors were killed by security forces.


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