Bolivia says it's nationalizing electrical grid
Source: Associated Press
May 1, 2:25 PM EDT
Bolivia says it's nationalizing electrical grid
By CARLOS VALDEZ
Associated Press
LA PAZ, Bolivia (AP) -- Bolivia's President Evo Morales announced Tuesday that his government is completing nationalization of the country's electricity industry by taking over the bulk of its electrical grid from a Spanish-owned company.
Morales also took advantage of the symbolism of May Day, the international day of the worker, to order troops to take control of installations of the company, a subsidiary of Red Electrica Corporacion S.A.
"We are nationalizing the Transportadora de Electricidad in the name of the Bolivian people as a fitting homage to the workers who fought for the recovery of our natural resources and basic services," Morales said during a ceremony at the presidential palace.
"We invested $220 million in generation and others profited. For that reason, brothers and sisters, we have decided to nationalize electricity transmission," he said.
Read more: http://hosted.ap.org/dynamic/stories/L/LT_BOLIVIA_ELECTRICAL_GRID?SECTION=HOME&SITE=AP&TEMPLATE=DEFAULT
cstanleytech
(26,342 posts)Benefit: It hopefully helps control and or bring down the cost of the electricity for the people.
Risk: They might have trouble getting foreign governments to lend them money and or luring foreign corporations to invest since the corporations have a legit worry about the government taking their property.
limpyhobbler
(8,244 posts)I hear the interest payments on those international loans can be a real bear.
cstanleytech
(26,342 posts)something that was to cause crops to fail they might need a loan but be unable to get it as the banks have a legit reason now view them as an unreliable credit risk.
Like I said its just a benefit vs risk issue and I just hope they considered it carefully.
zipplewrath
(16,646 posts)The article states that compensation negotiations will take place. It also mentions that the government has invested way more than the private sector. And this is something that was only privatized in the '90s.
This could be far less damaging as long as they compensate the companies for their capital investments.
RufusTFirefly
(8,812 posts)The world's foremost imperial power can't be pleased with the precedent this sets.
Cleita
(75,480 posts)We should follow suit at a county or state level. I hope Morales doesn't get assassinated or something. He has been very good for Bolivia IMHO.
hack89
(39,171 posts)that's the danger here - infrastructure is expensive and requires specific skills to manage.
The Venezuelan oil industry should serve as a warning here - oil production has been steadily declining for nearly a decade due to the lack of foreign investment and expertise.
Cleita
(75,480 posts)in power because they don't want the oil to benefit the common people, which is what Chavez wants. There are no big international utility interests that give much of a hoot about what Morales is doing in Bolivia. I'm keeping my fingers crossed that this remains so.
marmar
(77,106 posts)Extract the multinational leeches -- it will do you a world of good.
progress2k12nbynd
(221 posts)Or are the original investors/employees just SOL?
And how do we duplicate in the USA?
cstanleytech
(26,342 posts)legislature as well as the courts and I dont think thats likely to happen, not impossible mind you just unlikely.
Prometheus Bound
(3,489 posts)But it usually seems to be a rather long process according to this article. I guess the preferred 'win-win' goal doesn't necessarily work in these sorts of negotiations.
Judi Lynn
(160,656 posts)Bolivian president puts electricity back in public's hands
Wednesday 02 May 2012
by Our Foreign Desk
Bolivian President Evo Morales announced yesterday that his government is completing the nationalisation of Bolivia's electricity sector by seizing a Spanish firm's stake in the grid.
Mr Morales told crowds massed outside the Government Palace for a May Day rally that bringing the country's power grid back into public ownership was "a fair homage to the workers and the Bolivian people who have fought for the recovery of their natural resources and basic services."
The Movement for Socialism (MAS) government has contacted Spanish authorities to assure them that it will deliver fair compensation for the take-over of Red Electrica Espanola's (REE) assets.
It has tasked an independent auditor with setting compensation to be paid to the Spanish company within 180 days.
More:
http://www.morningstaronline.co.uk/news/content/view/full/118538