Bolivia seizes control of energy, telecoms firms

Bolivia seizes control of energy, telecoms firms
By Raul Burgoa AFP - Friday, May 2 12:18 am

LA PAZ (AFP) - Bolivia's President Evo Morales on Thursday said the government was taking control of the national telephone company and some foreign-owned energy concerns, continuing a two-year nationalization process.

In an announcement coinciding with the May 1 workers' holiday, Morales said the government was taking control of energy companies Chaco (controlled by British Petroleum), Transredes (Ashmore Energy) and CLHB, controlled by German and Peruvian firms.

Bolivian soldiers and police took over the installations being nationalized after the announcement.

"Bolivia wants partners, not owners," Morales proclaimed.

The move came on the same day that the socialist president declared nationalized the telephone company that offers service across Bolivia, run by Euro Telecom International (Entel), a subsidiary of Telecom Italia.

"Today we are nationalizing Entel, and starting today Entel returns to the hands of the Bolivian people," Morales told a huge crowd in a May Day speech in La Paz.

A source close to Entel executives said the company is awaiting an official decree so they can issue a reaction.

Morales warned Entel against resistance to this order by "any worker or manager in the enterprise," and threatened to take "absolute control of Entel from this very moment.

But Euro Telecom International last October petitioned the World Bank's International Centre for Settlement of Investment Disputes to arbitrate La Paz's plan to seize its shareholding in Entel.

Entel was privatized in 1996, during the government of free-market oriented president Gonzalo Sanchez de Lozada.

The announcements come two years after another May Day decree by Morales which placed much of his country's energy industry under state control.

Since the May 2006 decree Bolivia has received a flood of revenue that reached 1.7 billion dollars in 2007 and is expected to reach 2.5 billion dollars by the end of 2008, Morales said.

That wealth "does not belong to Evo Morales, or the government, or the prefects or the mayors, it belongs to all the Bolivian people," he said.

His statement was designed to counter claims by regional leaders in the rebel provinces of Santa Cruz and Tarija -- where more than 85 percent of the country's hydrocarbon wealth is located -- that they deserve a higher percentage of profits from gas sales.

Landlocked Bolivia, South America's poorest nation with a population of 9.5 million, has the region's biggest gas reserves.

Bolivia has been shaken by political crisis in recent months, ahead of a referendum planned for Sunday that would give the relatively wealthy eastern lowlands province of Santa Cruz political autonomy in a direct challenge to Morales.

The vote would authorize Santa Cruz to implement statutes to let it run its own finances and create its own security force.

The leftist administration of Morales, the country's first-ever indigenous president, has pledged to ignore the move, which appears likely to pass by an overwhelming margin.

An admirer of Cuba's Fidel Castro and ally to Venezuelan President Hugo Chavez, Morales -- elected in December 2005 -- has also pushed a plan to redistribute wealth to the country's poor indigenous people.