[Marxism] Morales creates Cabinet post to defend nationalizations of companies in Bolivia
fred.fuentes at gmail.com
Sat Jun 7 17:57:16 MDT 2008
Morales creates Cabinet post to defend nationalizations of companies in Bolivia
The Associated Press, June 6, 2008
Bolivia has created a new cabinet-level ministry to defend the country
from legal battles sparked by President Evo Morales' drive to
nationalize key sectors of the economy.
To be led by Hector Arce, a 37-year-old lawyer and former government
coordination minister, the new agency will back state efforts to
reclaim control of petroleum, mining, telecommunications and other
companies that were privatized during the 1990s, Morales said late
Details on the ministry's powers and responsibilities were not
immediately available, but it appears set to lead often testy takeover
talks with foreign companies, now handled by the foreign ministry.
Morales has sought control of many privatized industries, boosting
state ownership of Bolivia's oil and gas sector in 2006 — a so-called
"nationalization" that grabbed headlines but allowed most foreign
companies to continue operations.
This year, he fully nationalized several natural gas producers and
logistics companies, including subsidiaries of the Spanish company
Repsol YPF and British Petroleum. He nationalized Bolivia's few
railroads in 2007.
Some companies have threatened to challenge the takeovers in
international court, prompting Bolivia to withdraw last year from a
World Bank tribunal that hears disputes between governments and
foreign businesses. The court's rulings are often biased in favor of
transnational companies, Bolivian officials claimed.
But still pending before the tribunal is an arbitration request from
Italy's Euro Telecom International, which is disputing Bolivia's move
to nationalize its subsidiary, Entel. The company was Bolivia's state
telephone company until it was privatized in 1995.
Swiss mining company Glencore International has also disputed Morales'
nationalization of a Bolivian tin smelter last year, citing an
investment treaty between the two countries. The case will likely be
resolved in ongoing talks over two other Glencore mines, said a mining
ministry official who spoke on condition of anonymity because he was
not authorized to discuss the negotiations.
At the urging of the World Bank and International Monetary Fund,
Bolivia underwent sweeping privatizations in the mid-1990s, selling
state-owned oil and gas, water, power, railroad and telecommunications
companies, along with the national airline and state pension plan.
But the policy's mixed results largely failed to spur the economic
growth the international creditors had hoped for, instead prompting
the anti-privatization sentiments that drive Morales' economic
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