Written by Franz Chávez
Tuesday, 29 July 2008
(IPS) - Revenues from Bolivia’s sales of natural gas, which have ballooned in the last few years, are now at the centre of the tense political polarisation threatening to tear the country apart and are a main motivation in the opposition’s attempt to undermine the leftwing government of Evo Morales.
Gas revenues soared from 188 million dollars in late 2001 to 1.57 billion dollars in 2007, after the Morales administration forced foreign oil companies to renegotiate the terms of their contracts, thus increasing the royalties and taxes paid by the companies.
The revenues now represent one-seventh of Bolivia’s gross domestic product (GDP) of 11 billion dollars, and have become the main source of income for the governments of the country’s nine provinces.
In 2007, the government distributed 737 million dollars in natural gas taxes to the nine provinces, according to figures provided to IPS by the Energy Ministry.
That figure was 446 million dollars higher than the first distribution of the new direct hydrocarbons tax (IDH), in 2005, when the then government of interim president Eduardo Rodríguez created the tax aimed at transferring money to the provincial governments.
Today the pie to be carved up is enormous. Senator Fernando Rodríguez of the rightwing opposition Podemos coalition told IPS that the total gas revenues taken in by the state will easily reach four billion dollars this year, based on natural gas exports to Brazil and Argentina and domestic fuel sales.
The seemingly unstoppable rise in the international price of oil has also boosted the country’s gas income, despite the fact that gas sales to Brazil and Argentina have declined due to growing domestic demand for gas in Bolivia, even though this country has the largest natural gas reserves in South America -- 47 trillion cubic feet -- after Venezuela’s.
Rodríguez said that under the current law on the distribution of natural gas revenues, 440 million dollars should go to the gas-producing regions of Santa Cruz, Tarija, Chuquisaca and Tarija, and 160 million to the remaining five provinces.
But the huge windfall profits prompted Morales to divert a substantial portion of the transfers to the provinces into a universal pension fund for people over 60, which expanded the number of eligible elderly people from 489,000 to 676,000, providing them with the equivalent of 27 dollars a month.
A source with the provincial government of Tarija, the country’s most natural gas-rich province, told IPS that this year, the transfers to the provincial governments will be 260 million dollars less than in 2007, as a result of the pension programme.
José Antonio Aruquipa of Podemos, a member of the constituent assembly that is rewriting Bolivia’s constitution, told IPS that the movement for autonomy in the provinces of Santa Cruz, Beni, Pando and Tarija is fuelled by the aim of gaining greater provincial control over gas revenues. "Without the IDH, autonomy is a vehicle without gasoline," he said.
Bolivia, South America’s poorest country, is basically divided between the western highlands, home to the impoverished indigenous majority, and the much wealthier eastern provinces, which account for most of the country's natural gas production, industry, agribusiness and GDP. The population of eastern Bolivia tends to be of more European (mainly Spanish) and mixed-race descent.
The rightwing opposition argues that the national government only needs 200 million dollars, rather than the 260 million dollars that it currently retains from the natural gas revenues for the pension for the elderly.
http://upsidedownworld.org/main/content/view/1399/68/Right-wingers are the same all over the world. Selfish and evil.