Category Archives: Development

Citizenship or Repression? Coca, Eradication and Development in the Andes – Bolivia

Authors: Thomas Grisaffi and Kathryn Ledebur. (2016)

Abstract: For over two decades the US has funded repressive forced coca eradication in Peru, Colombia and Bolivia to reduce the illegal cocaine trade. These policies have never met their stated goals and have generated violence and poverty. In 2006 Bolivia definitively broke with the US anti-narcotics model, replacing the militarized eradication of coca crops with a community-based coca control strategy. The program substantially reduced the coca crop while simultaneously respecting human rights and allowing farmers to diversify their livelihoods. This article outlines the elements of the Bolivian initiative that ensure its continued successful functioning.It
explores to what extent this model can be translated to other  Andean contexts. To read this paper please click here: Stability Journal- Citizenship or Repression

Bolivian Political and Social Landscape: Primer for Pending Presidential Elections

As the presidential campaigns gain momentum, AIN outlines the political and social landscape in Bolivia to provide background to understand upcoming electoral debates.

President Evo Morales is running for a third term in the October 12, 2014 elections.  Critics argue he is not eligible to run for another consecutive term, but the Plurinational Constitutional Tribunal ruled in his favor, and the opposition across the political spectrum lacks a strong, unifying candidate.  Four candidates have formally registered to run against Morales.

Bolivian Government Achievements

  • Macroeconomic success:
    • From 2009 to 2013, Bolivia’s economy experienced steady growth.

1 GDP growth

The population living in extreme poverty fell from 38% in 2005 to 24% in 2011.

2 poverty

  • Bolivia has accrued a significant “rainy day fund.”  According to the New York Times,  “Bolivia has the highest ratio in the world of international reserves to the size of its economy, having recently surpassed China.”
  • Employment rates and wages have both steadily increased under Morales. The minimum wage increased in 2013 from about $145 USD (1,000Bs) to about $174 USD (1,200Bs) a month.
  • Double holiday bonus: In November 2013, President Evo Morales decreed that all employers must pay a double holiday bonus to all employees.  Previously, the bonus was one month’s salary paid in December.  The double holiday bonushad a mixed reception, celebrated by workers, but criticized by many employers and small business owners.
  • Social programs: The Morales administration started several popular cash transfer programs, including benefits to school children and pregnant mothers, which have promoted significant decreases in maternal and infant mortality as well as increases in school attendance and high school graduation.
  • Gas income: The Bolivian government has strengthened the economy by increasing state hydrocarbons revenues as a result of the 2004 hydocarbons law, the 2006 Nationalization Decree, and high gas prices.  This income has permitted significant investment in infrastructure and social programs.

Coca Leaf and Drug Control

  • In 2013, Bolivia successfully petitioned the United Nations to recognize legal coca cultivation and uses within its borders.
  • The Morales administration has achieved sustained reductions in the cultivation of illicit coca leaf using a system of community coca control. (26% reduction from 2010-2013).
  • Unlike previous military forced eradication, this innovative model relies on coca grower participation.  This model guarantees subsistence and enables coca growers to diversify their income, leading to greatly reduced human rights violations.  For more information see this WOLA-AIN memo.

3 eradication
Source: Bolivian Vice-Ministry of Social Defense

  • Bolivia currently has less than half as much coca as Colombia and Peru.  Yet inexpensive and abundant Peruvian cocaine paste base floods through Bolivia to Brazil and other consumer countries, offsetting national control efforts.
  • The Morales’ administration has diligently pursued drug interdiction after the 2009 expulsion of the US Drug Enforcement Agency, reporting significantly increased seizures. However, the great bulk of cocaine sales and profits trafficking occur outside Bolivia’s border, limiting the impact of these initiatives.
  • In spite of tensions, US-Bolivian on-the-ground collaboration on coca reduction continued productively until September 2013, including a trilateral agreement, including Brazil, to improve monitoring technology.

Challenges facing the Morales Administration 

  • TIPNIS issue: In spite of much rhetoric about protecting the rights of Mother Earth, the Morales administration has gone ahead with plans to build a highway through the Amazon, including the TIPNIS, a national park and indigenous territory.
    • This is an enduring point of contention in the country, most notably among lowland indigenous peoples who led two marches to La Paz to protest the lack of prior consultation of TIPNIS resident about the project, which is guaranteed by the 2009 Bolivian constitution.  Both marches, in 2011 and 2012, were met with police repression from the government. The segment of the construction project within the territory is on hold, but may be resumed.  Critics highlighted contradictions with the administration’s pro-indigenous and environmental discourse and its handling of the incident.
  • The lowland indigenous umbrella organization, CIDOB, and its highland counterpart CONAMAQ are both split between factions that support the MAS ruling party and its vocal opponents.
  • Policies of extraction vs. environment: One of the most significant challenges for the MAS administration has been balancing multi-sector demands for basic services financed primarily by extractive industries with its rhetoric of protecting and living in harmony with nature.
    • Bolivia’s economy has always been heavily reliant on extractive industries such as mining and hydrocarbons that have a substantial environmental impact.  Conflicts often arise in mining communities over the benefits of mining income versus the damage to the environment.  In addition, continuing contamination, such as the recent bursting of a damn holding toxic mining tailings in the Chuquisaca department, exacerbates the Morales administration’s inherited legacy of environmental degradations from centuries of mineral exploitation.
  • Violence Against Women: Violence against women and children has always been startlingly prevalent in Bolivia.  In March 2013, the Bolivian Congress passed a comprehensive a law to address these issues, which contained progressive ideas and preventative measures.  However, the government lacks the resources and political will to fully implement the law.  See this AIN update for more information.

4 violence stat

  • Unsafe abortions: This is another concern for women in Bolivia.  Abortions are illegal except in the case of incest, rape, or if the mother’s life is in danger. Pro-choice advocates had a partial victory in a February 2014 constitutional tribunal ruling that upheld the illegality of abortion, but threw out the rule that requires women to get a judge’s consent in the three permitted exceptions.  (See Emily Achtenberg’s article in NACLA for more information on this ruling.)  Lack of access to and information about sexual and reproductive health combined with cultural taboos and widespread sexual violence put women’s health at risk and severely limit their choices.  Although they are illegal, an estimated 60,000 abortions are performed in Bolivia each year, and only 46% of them are performed without complication.  See this AIN update for more information.

5 abortions
Source: La Razón

  • Judicial delay and prison overcrowding: The Bolivian justice system suffers from tremendous judicial delay, resulting in lengthy pretrial detention, as well as severe prison overcrowding.  Only 17% of prisoners in Bolivia are actually serving their sentence, while the other 83% are merely awaiting trial, which could take years.  After prison riot and fire that killed 35 people, Morales a pardon and amnesty decree in September 2013.  However, to date the pardon has benefitted only about 800 people. More comprehensive reforms, including the reduction of disproportionately high drug sentences (drug war prisoners make up almost half of all inmates) need to be enacted.

6 prisoners
Source: La Opinión

  • Legacy of dictatorships: Unlike neighboring Chile and Argentina, which initiated some legal action against those involved, impunity for authors of human rights violations continues in Bolivia.   A group of survivors of the dictatorship have maintained a vigil for more than two years outside the Ministry of Justice, demanding acknowledgment for the crimes of the dictatorship and the declassification of military files from the dictatorship era.  In 2004, the Bolivian government passed a law guaranteeing compensation to victims, but modifications have reduced the initial promised aid to 20%, and only 1,714 of the 8,000 who applied were approved to receive benefits.  See this AIN update for more information, as well as this Amnesty International report and BBC article.

 

7 dictatorship march
Photo: Gonzalo Ordoñez for AIN

Bolivian-US Bilateral Relations

  • A mutual lack of trust is the single largest impediment to improved bilateral relations.  This lack of confidence should be addressed as a prerequisite for reinstatement of ambassadors. In spite of a lack of ambassadors, bilateral relations have varied, depending on the skill of the Chargés and other officials from both nations.
  • A lack of transparency on the part of USAID and credible allegations that the agency was inappropriately aiding lowland opposition led Morales to expel Ambassador Goldberg in 2008.  USAID in Bolivia did not follow international agreements on development. See AIN background.
  • The Morales administration responds positively to genuine diplomatic gestures.  For example, November 2008 meetings with US congressional leaders permitted the sort of frank exchanges that can create rapport and lay the basis for more regular dialogue and better mutual understanding. See WOLA and AIN analysis on bilateral relations.
  • US decisions to “decertify” Bolivian drug control efforts since 2008 are increasingly disconnected from reality. Governments in the region continue to see the US determinations as offensive and politically motivated. More information here.
  • US funding steadily decreased since 2008.  Although the Narcotics Affairs Section, the Drug Enforcement Agency, and USAID are now gone, Bolivia has compensated with funds from its own treasury and increased support from the European Union.
  • Request for extradition of ex-President Gonzalo Sánchez de Lozada: Widespread resentment continues for the US refusal to extradite the ex-president for the death of 69 protestors in October 2003. Although US officials claim the charges are politically motivated, two-thirds of the Bolivian congress, where Sánchez de Lozada’s own coalition had a majority, voted to indict him. The Bolivian government submitted a new extradition request on July 10th, 2014 and the US has promised to respond within sixty days. The US is expected to reject this initiative.
  • US citizen Jacob Ostreicher accused of money laundering:  Although US representatives and Sean Penn have argued for Ostreicher’s innocence, charges against Ostreicher appear credible. He was subject to protracted pre-trial detention in violation of his due process rights, as is every Bolivian arrested on drug charges under drug legislation imposed by the US in 1988.  There was also a great deal of corruption around his case on the part of some Bolivian government officials.  He escaped from Bolivia at the end of 2013 and is considered a fugitive by Interpol.

Conclusion

Recurring protests and strikes from diverse sectors, including transportation workers, university students, and milk and meat producers have characterized the political and social landscape in the past few months.  However, this does not necessarily equate to discontent with the Morales administration.  Rather, many sectors are strategically taking advantage of election momentum to leverage to get demands met.  As one indigenous protester explained, “We’re not the opposition.  We just want the respect of our people and our rights and a solution.”

Although the administration’s performance has been mixed, Morales still enjoys widespread support and his party will most likely retain a majority in both houses of congress.  Furthermore, the opposition on both the left and the right lack a strong, representative, unifying candidate.  It is likely that Bolivian voters will opt for continuing the status quo.

Bolivian Quinoa Questions: Production and Food Security

In January and March 2011, several English-language press outlets ran stories on quinoa production in Bolivia. National Public Radio and the Associated Press reported on quinoa as a development project, hailing its benefits to farmers in the altiplano region of Bolivia.  The New York Times article focused on quinoa’s rising popularity abroad making it less affordable for low income Bolivians. Both AP’s “Quinoa’s Popularity a Boon to Bolivians,”[i] and the Times’Quinoa’s Global Success Creates Quandary at Home” highlight the complex relationship between food security and economic development in Bolivia, although with differing perspectives.

The impact of rising food prices is complex and encompasses food security and sovereignty debates, issues that are difficult to address thoroughly in brief articles.  Until a comprehensive study provides insight into rising quinoa prices, it is difficult to make strong affirmations.  The impact of quinoa production and export must be understood both within the framework of global food security issues and specific local contexts. While these articles presented some important issues, challenging local conditions that affect quinoa consumption and production also substantially affect income generated by this crop.

Quinoa fetches a guaranteed high price affording farmers economic stability. This economic power has also translated into political power though producers’ associations and cooperatives.  Since the 1970’s, these organizations have worked toward greater producer control of the market, spurring other political actions such as blockades and protests for greater economic and environmental rights in quinoa-growing regions.[ii]

Missing key aspects of the “quinoa quandary”

Unfortunately, the Independent article, “The Food Fad That’s Starving Bolivia,” and several online reposts of the Times piece misrepresented the complex relationship between malnutrition and rising quinoa prices by encouraging North American and European consumers to stop buying Bolivian quinoa.  Although the Times never suggested this solution for Bolivian malnutrition, a letter to the editor advocated that exact idea.[iii] Adam Sherwin made glaring and easily avoidable errors in the Independent, for example citing the North American Aztecs when he should have mentioned the Andean Incas. Furthermore, whole paragraphs of Sherwin’s article are copied almost word for word from the Times’ piece, yet Sherwin manipulated its conclusions.

He further incorrectly argued: “There is a potential threat to South America’s farmers – quinoa can thrive in the wet climes of Bolton as well as Bolivia. An increasing number of Britons are cultivating their own supply of quinoa in kitchen gardens and allotments,”[iv] suggesting that small-plot quinoa production in North America and Europe threatens Bolivian farmers’ income.  In doing so, he implies that buying Bolivian quinoa negatively affects Bolivian consumers, yet growing it at home negatively affects Bolivian farmers.  He thus conflates consumption and production issues, with no supporting analysis., and misrepresents the role of international consumers..

Complications of price-based analysis

  • Simon Romero and Sara Shahriari wrote in the Times: “Fewer Bolivians can now afford [quinoa], hastening their embrace of cheaper, processed foods and raising fears of malnutrition in a country that has long struggled with it.”  By ‘processed foods,’ the authors clarified that they meant simple carbohydrates such as white flour and rice, rather than canned or pre-prepared products with chemical additives that provide lower nutritional value.  However, less nutritious white rice and wheat actually require cheaper, simpler processing than the costly, complicated procedures necessary to make quinoa edible.  Raw quinoa must be soaked, rolled, and rinsed to remove the bitter resin covering its seeds.
  • It’s important to understand comparative food prices accurately presented by the Times in context.  Quinoa does on average cost U.S. $4.85 per kilo in Bolivia, compared to white rice at about $1.10.  However, quinoa is more filling than rice and as a result, generally is eaten in smaller portions. For example, many people add small amounts of quinoa to soups and stews.  Furthermore, the Bolivian government subsidizes staples including wheat and rice, artificially lowering prices.  Currently the Morales administration struggles with how to keep food prices affordable while satisfying producers’ needs (See “Ongoing, Unresolved Issues Likely to Perpetuate Tensions in Bolivia”).
  • Furthermore, rising food prices are a global problem, and virtually all staples have increased in price in Bolivia.   For example, rice prices have almost doubles during the last five years.[v] While most pasta often costs less than quinoa, prices vary greatly. Some pasta varieties – particularly whole-grain and more nutritious types – cost over $5.00 per kilo, more than quinoa.  These prices do not reflect rising international costs, but domestic consumption preference; there is lower demand for the more expensive varieties.
  • While quinoa is extremely healthy, Bolivia also produces other highly nutritious seeds and grains, including kañawa[vi] and amaranth.  Both are increasingly available in flours, granolas, and baked goods.  Encouraging production of these grains and seeds for domestic consumption could provide alternatives to high priced quinoa for Bolivians. These grains are not yet widely grown for export, and could therefore remain economical in the national market. Quinoa is not the only nutritious part of the typical Bolivian diet, and with properly managed development and nutrition programs the Bolivian government could expand production and consumption of quinoa alternatives.
  • It is crucial to compare current malnutrition levels to statistics from the 1970’s – when quinoa production for export initially accelerated – to accurately analyze its effect on farmers’ nutrition. The causes of malnutrition in the altiplano, a historically poor and under-served part of the country, are multi-faceted and linked to harsh agricultural conditions, poor infrastructure (which makes food products from the rest of the country less accessible and more expensive), and low economic opportunity.
  • Families make complex choices between keeping quinoa for their own consumption or selling it to invest in education, housing, small businesses, and other food staples. In fact, most quinoa-producing families still eat quinoa at least once a week, and others do so daily. [vii]

Harsh Production Conditions Help Explain Higher Prices

  • Farmers face additional challenges, both in growing and selling quinoa.  Smugglers take quinoa into Peru, selling it at a higher price without benefitting Bolivian producers.  Some of this quinoa later makes it way to international markets, giving the bulk of profit to Peruvian sellers.
  • Periodic droughts in the altiplano, which will likely increase with global warming, can kill crops or delay production.  Furthermore, altiplano soils are dry and lacking in nutrients, making organic and sustainable farming a challenge.  However, many farmers continue to practice organic techniques since organic quinoa fetches a higher market price.[viii]

The importance of a balanced historical perspective

  • Quinoa production is far more robust than it was before the 1970’s.[ix] It is crucial to examine long-term trends to understand why quinoa is such a valuable resource.[x]
  • In general, the quinoa boom greatly benefits farmers in spite of little state support. [xi] According to Kevin Healy, “The fact that some indigenous quinoa pioneers had to seek out adequate technologies for quinoa processing in neighboring Peru is a testimony to the low public status which quinoa agricultural development faced for various decades of the modern era despite Bolivia’s position as the world’s premiere quinoa producer.” [xii]
  • The Times article links to the United States Agency for International Development (USAID) website when it cites “American foreign aid organizations” that helped farmers start growing quinoa for export (along with European groups). However past projects, many funded by (USAID), often encouraged farmers in the altiplano to grow wheat[xiii] instead of traditional crops.  In the 1950’s and 1960’s, these projects largely failed, especially as farmers could not compete with low-cost wheat from of U.S. food assistance programs.[xiv] Furthermore, international aid organizations and the Bolivian government continued to encourage both wheat and rice production – helping to explain its continued prevalence in the Bolivian diet.
  • In fact, the smaller, more pragmatic U.S. Interamerican Foundation and various European organizations helped support farmers’ initiatives to significantly enhance their income through export.  USAID support only began within the last five years, after production and export circuits had been established and prices had already increased.

Personal preferences matter

  • Quinoa production and consumption in Bolivia vary by local context and individual choice. According to Andrew Ofstehage, Bolivian quinoa farmers often make individual decisions. Some farmers prefer not to market their quinoa through co-ops because they gain greater benefits and avoid prohibitive transport costs. [xv] Instead, they sell to intermediaries or barter to enrich their diets with fresh fruits and vegetables, as well as other staples.[xvi]
  • As Romero and Shahriari suggest, quinoa consumption in Bolivia fluctuates by region and personal preference. They quote the Bolivian Vice Minister of Rural Development and Agriculture: “It has to do with food culture, because if you give the kids toasted quinoa flour, they don’t want it; they want white bread.  If you give them boiled water, sugar and quinoa flour mixed into a drink, they prefer Coca-Cola.”[xvii]
  • Outside of the altiplano, Bolivians consume quinoa less frequently, especially in the lowlands, since it is not grown there nor considered a staple food, although this pattern has shifted due to highland migrants moving into the lowlands.  Quinoa has been part of the diet in the mid-highland regions, such as Cochabamba, for centuries. In past decades, quinoa’s popularity declined among the upper middle classes in favor of wheat and rice that they perceive as more “sophisticated” and “upwardly mobile.” Ironically, the valorization of quinoa in North American and European markets has caused many up-scale Bolivian restaurants to begin serving quinoa and the middle and upper class to consume more of the grain.

Conflicting data complicates research

  • The lack of verifiable data complicates quinoa research.  For example, the Bolivian government, quinoa producers’ associations and the United Nations Food and Agricultural Organization (FAO) all track quinoa production, yet release completely different statistics. Contraband quinoa smuggled into Peru, informal sales of quinoa, and lack of documentation in all quinoa-producing parts of Bolivia all further complicate tracking the percentage of quinoa exported versus sold domestically. This situation highlights the need for more careful and precise reporting on quinoa production and consumption.

Big picture: Food security and development are complex, global issues

Recent media coverage on quinoa lauds Bolivian rural development initiatives or highlight food security concerns.  In reality, the “quinoa quandary” encompasses both approaches; examining it through only one lens obscures the multi-faceted nature of quinoa production and consumption in Bolivia.

Food security and sovereignty are ever evolving – neither term has a universal definition or scale of reference.  Food security, at the most basic level, implies an adequate food supply to give all people proper nutrition.  Proponents of food sovereignty, on the other hand, affirm that small producers and consumers should have influence in shaping food policy.[xviii] As a result, it is crucial to acknowledge the global scale and system that affects food prices and consumption choices.

Experts on food issues point to the need to consider the multiple hierarchies of power involved in food production and prices in order to understand how positive changes can be made.[xix] The Times published a letter to the editor that asserted: “While I appreciate being able to find such a nutritious and satisfying product on the shelves of my local supermarket, I’d gladly give it up to ensure that Bolivians can afford to eat it. Having foods from around the world is a convenient luxury so long as others are not paying a hefty price for it.”[xx] Foreign consumers of quinoa can stop buying the grain, but this change would actually intensify existing poverty and malnutrition by taking away Bolivian producers’ steady source of income.  True food and economic security must be achieved simultaneously.

Bolivian quinoa production straddles the line between food and economic security.  There is no easy answer to the problems created by rising food prices. However, the positive changes for quinoa producers cannot be ignored in the debate. As Healy explains:

Quinoa’s current boom would probably have been much weaker had the Quechua and Aymara producers themselves not organized producer associations to revitalize quinoa real (the most commercial variety of quinoa) back in the late seventies and eighties. In contrast to Peru where quinoa received a big boost from the national government, Bolivian state institutions with the exception of several agricultural research stations provided little support to producers for credit, marketing or processing nor promote recognition of its food value among Bolivian consumers.[xxi]

Just as they have pushed to expand the quinoa industry, Bolivian producers and consumers must be the catalyst to push for greater food security and sovereignty.  Bolivian Government nutrition programs have begun to incorporate quinoa into school breakfast and new mothers’ subsidies,[xxii] finally recognizing the important role quinoa can play in food security.  Quinoa farmers, government entities and funding organizations must work collaboratively to insure that quinoa continues to benefit both producers and consumers in Bolivia.


[i] Note: this AP article prompted the NPR story

[ii] Ofstehage, “The Gift of the Middleman: An Ethnography of Quinoa Trading in Los Lipez of Bolivia.”

[iii] Loubaton, Emily, “ Re ‘A Food’s Global Success Creates a Quandary at Home’(news article, March 20),” letter to the editor, the New York Times, 26 March 2011.

[iv] Sherwin, Adam, “The food fat that’s starving Bolivia,” The Independent, 22 March 2011.

[v] Rice in Cochabamba sold at $0.46 USD wholesale in April 2006 and $0.91 USD/kilo in April 2011.  See FAO’s price tool for more information:

[vi] Other similar crops include kañiwa and kiwicha.

[vii] AIN Interview with Andrew Ofstehage,  PhD Candidate at UNC Chapel Hill, 3 May 2011.

[viii] Healy, 183-4

[ix] Ofstehage interview

[x] Ibid.

[xi] Ibid and Ofstehage Interview.

[xii] Email communication, 11 May 2011.

[xiii] Spanish settlers introduced rice and wheat into the Bolivian diet.[xiii]

[xiv] Healy, Kevin, Llamas, Weavings, and Organic Chocolate: Multicultural Grassroots Development in the Andes and Amazon of Bolivia, Univeristy of Notre Dame Press, 2001: 161-162

[xv] Ofstehage interview.

[xvi] Ibid; See also: Ofstehage, Andrew “The Gift of the Middleman: An Ethnography of Quinoa Trading in Los Lipez of Bolivia.” Master’s Thesis, Rural Development Sociology, Wageningen University, August 2010.

[xvii] Romero, Simon and Sara Shahriari, “Quinoa’s Global Success Creates Quandary at Home,” The New York Times, 19 March 2011.

[xviii] Patel, Raj, “ What does food sovereignty look like?” The Journal of Peasant Studies 36: 3, July 2009, 663–673.

[xix] Ibid.

[xx]Loubaton.

[xxi] Email communication with Kevin Healy, 11 May 2011.

[xxii] Municipal Government of La Paz, “ El mejor desayuno escolar de Bolivia llega con más sabores y productos,” 31 January 2011.

Bolivian Police Scandal Resurrects Mistrust of U.S. Agencies and Threats to Expel USAID

On March 17, MAS party legislators announced that they would make a formal request to remove USAID from Bolivian territory. “We, the legislative party leaders have decided that USAID should leave our country, due to its clear intervention in different departmental governments, their pretext of [providing] seminars, conflict resolution workshops and other excuses for political meddling.”[i]

While the MAS legislative majority’s position is clear, it is not a foregone conclusion that the executive will ratify and act on this pronouncement.  The day after MAS assembly members made their announcement, Morales complained about economic cooperation, stating that the U.S. government “blackmailed” Bolivia through the ATPDEA (Andean Trade Promotion and Drug Eradication Act), suspended in 2009. He did not specifically mention USAID or its potential expulsion.[ii]

High-ranking government officials had threatened to expel the development agency in June 2010, but did not follow through, apparently due to a lack of cabinet consensus on the issue and less grassroots support than expected for the initiative. In spite of this lack of consensus, Morales officials infuriated some indigenous and social organization by accusing them of receiving USAID funding and influence.  Their heated rejection of these claims suggests that the agency maintained a negative public image among many Bolivian sectors.

Persisting friction over the role of several U.S. agencies catalyzed the recent announcements.  MAS constituents continue to mistrust the U.S. as a result past violations of Bolivia’s national sovereignty throughout the drug war and an ongoing lack of transparency in development programs.  The DEA’s role in arrest of Bolivia’s ex-head of counternarcotics police, Rene Sanabria, who until his detention had been in charge of a government ministry antinarcotic intelligence agency, has aggravated these tensions.

In late February 2011, the DEA, after a sting operation by the Chilean police, apprehended Sanabria in Panama for allegedly trafficking 140 kilos of cocaine to Miami. Although no one in Bolivia argues his innocence or advocates his release, the Morales administration resents that the Chilean and U.S. governments did not inform them directly of Sanabria’s activity, giving the impression that they condoned or even facilitated his large-scale trafficking operations. The embarrassing incident, followed on March 16 by the  narcotics-related arrest of an ex-Santa Cruz Interpol commander, has led to a change of the police high command and of other police officers implicated in cocaine trafficking.

Furthermore, the Bolivian government’s concern, already intensified by the scandal, that the DEA still maintains surveillance and contacts within Bolivia heightened with statements made this week by DEA administrator, Michele Leonhart, in a congressional hearing. The Bolivian press widely reported her comments: “Unable to operate within the country, the DEA has what we call an ‘external strategy,’ through personnel who work in offices in neighboring countries and a network of informants outside Bolivia.” Leonhart’s assertions that drug abuse in Bolivia “is already bad, but is getting worse,” and that “Evo Morales sees this situation through a different lens as leader of the coca growers,”[iii] further rankled MAS officials.

Conclusion

In part, MAS legislators may be resurrecting a historically successful tactic of asserting Bolivian sovereignty in order to strengthen support from traditional party constituents demanding government concessions.  Renewed threats to expel USAID come as the Morales administration faces considerable internal challenges, including widespread workers’ union strikes and protests among other diverse social groups. Executive attention to these pending conflicts may take precedence over decisions about USAID’s presence in the nation.

Although the scandal surrounding Sanabria’s arrest generated resentment about the DEA’s  past role in Bolivia and current agenda, it also provoked insecurity within the administration that their control that interdiction and drug related corruption in the police force has been less effective than they had previously believed.  Limited external funding opportunities further exacerbate these fears. Aside from limited financial cooperation from Brazil, the Morales administration has not yet secured alternative funding sources for these programs.  As a result, although the Morales administration frequently expresses frustration with conditions tied to U.S. financial assistance, it is unlikely that they are willing to risk losing U.S. drug control aid by expelling USAID at this time.

Yet, paradoxically, although the Bolivian government needs financial support for coca and drug control efforts, MAS officials expect that with announced reductions in U.S. funding over the next two fiscal years[iv], they have less to lose in expelling USAID. From a national political perspective, this tactic would also “beat the U.S. to the punch.”


[i] ABI, “Bancada del MAS pedirá expulsión de USAID por injerencia e intromisión.” 17 March 2011. <http://www.abi.bo/nucleo/noticias.php?i=2&j=20110317180507.>

“Los jefes de bancada hemos tomado la decisión de que USAID debe dejar nuestro país por la clara intromisión en los diferentes gobiernos departamentales, so pretexto de seminarios, talleres de resolución de conflictos y muchos otros temas de injerencia política”, señaló el jefe de bancada del MAS en la Cámara de Diputados, Edwin Tupa.

[ii]Evo acusa a EEUU de chantajear a Bolivia con el ATPDEA.” Opinion 18 March 2011 http://www.opinion.com.bo/opinion/articulos/2011/0318/noticias.php?id=5220

[iii] AIN translation from Spanish. “La DEA revela que vigilaba a Bolivia con informantes.”  La Razón, 17 March 2011. http://www.la-razon.com/version.php?ArticleId=127032&EditionId=2470.

[iv] For more information see, “ Reduced U.S. Funding to Bolivia Reflects Diminishing Influence and Complex Dynamics.”  http://ain-bolivia.org/2011/02/reduced-u-s-funding-to-bolivia-reflects-diminishing-influence-and-complex-dynamics/

Is Bolivia Ready to Export Lithium?

On October 11, Bolivia’s Mining Minister Jose Pimentel stated that Bolivia plans to start production of lithium carbonate and potassium chloride for export this month, and expects a finalized product by January or February.[i] However, it is unlikely that Bolivia’s lithium carbonate will be available on the international market in the near future.

At an isolated pilot plant, Bolivian and international scientists have been working to develop a process to separate lithium from other minerals present in Bolivia’s Salar de Uyuni salt flats.  The unique climatic conditions and mineral concentration of the Salar present special challenges, and it is unclear whether the extraction process has been perfected.  Between October and March the region receives significant rainfall, which could negatively affect evaporation and separation.  This separation process can take up to 18 months, even without foreseeable rainy season delays.[ii] Furthermore, a successful trial run at the pilot plant would represent the first time lithium carbonate has been produced outside a laboratory in Bolivia.

The pilot plant, when fully functioning, should produce up to 480 metric tons of lithium carbonate per year, a small amount in comparison to regional competitor Chile’s annual production of 40,000 metric tons.  With lithium carbonate prices at five dollars per kilogram (April 2010), the potential sale of 40 tons a month seems fiscally feasible for a pilot plant that cost the Bolivian government $5.7 million.  Moreover, Bolivia and South Korea signed a deal for future investment in lithium in August 2010.

However, information about the Bolivian government’s economic strategy to get its lithium to market is not readily available.  Aside from the challenges of locating the “best market,” Bolivia faces immediate infrastructure hurdles.  The logistics of transporting the lithium to port in a region where roads and electricity are limited further complicate exploratory efforts.

Rebecca Hollender is lead author of “Bolivia and its Lithium; Can the ‘Gold of the 20th Century’ Help Lift a Nation out of Poverty,” (May 2010).  The report is available in English and Spanish at: http://www.democracyctr.org/bolivia/investigations/lithio.htm.


[i] “Bolivia to Start Producing Lithium in October for Export, Minister Says.” Bloomberg. 12 October 2010.

[ii] Estimate based on Chile’s lithium carbonate production methods.

Tuesday Hearing: Feierstein nomination raises questions about USAID’s role in Latin America

This Tuesday, June 29, the Senate Committee on Foreign Relations will hold a  confirmation hearing for President Obama’s nomination of Mark Feierstein to head USAID programs in Latin America.   Feierstein, of the firm Greenberg, Quinlan and Rosner, served as a political adviser to former Bolivian president Gonzalo Sánchez de Lozada during his 2002 Presidential campaign.  Sánchez de Lozada resigned and fled to Chevy Chase, Maryland in 2003 to escape prosecution for the massacre of 60 protesters by troops operating under his orders.  Last year Feierstein and his colleagues again conducted polling in Bolivia to assist the campaign of right wing candidate Manfred Reyes Villa, who lost by a landslide to President Evo Morales.[1]  The appointment of the political pollster has increased apprehension in the region that aid programs will continue to be used to support U.S.-favored political actors within the region’s democracies.

Feierstein’s appointment coincides with Bolivian government officials’ renewed accusations that USAID is intervening politically in some indigenous organizations.   Although the Morales administration has not yet proven these allegations, unfortunately there is a long history of using USAID funds for direct and indirect political intervention.  I worked in rural Bolivia from 1988-1996. During that time I personally observed how USAID-funded projects carried out through the American Institute for Free Labor Development (AIFLD) financed conventions, paid union leaders and split the Confederation of Bolivian Settlers into two factions. The program clearly worked to limit support for the coca growers’ federations headed by Evo Morales.  According to the General Accounting Office, from 1980-1994, USAID provided 87% of the budget of AIFLD, along with 10% from the National Endowment for Democracy.[2]  When AIFLD’s programs ended in 1996, the rift in the indigenous settlers’ unions in Bolivia healed immediately.

Undoubtedly, the Morales administration has not forgotten the history of AIFLD and other questionable aid programs since, and the Obama administration has done little to clarify the role and future focus of USAID efforts in Latin America to alleviate tensions.  Denunciations against USAID and Feierstein’s appointment have both complicated negotiations of a new framework agreement for U.S.- Bolivian relations. There is hope that the agreement would guarantee a more transparent aid relationship and establish a foundation for improved relations.

It is important to evaluate whether a nominee, who for many years fought partisan political battles, can successfully transition to running non-partisan and transparent USAID programs in Latin America.  This hearing is an opportunity for the Obama administration to “go on the record” to establish USAID’s respect for national sovereignty and guarantee program and contractor transparency and accountability.  The U.S.  Senate Committee on Foreign relations should ask Mr. Feierstein to clearly and completely address these crucial issues.

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[1] Interestingly, before doing polling in support of Reyes Villa in 2009, Feierstein and company raised questions during the 2002 campaign about Reyes Villa’s military record and unknown sources of the wealth. See the documentary film Our Brand is Crisis, by Rachel Boynton. Reyes Villa is now in Miami escaping corruption charges in Bolivia.
[2] http://pdf.usaid.gov/pdf_docs/PCAAA774.pdf

U.S. Development Assistance to Bolivia Should Follow International Norms

Hopefully, Assistant Secretary of State, Arturo Valenzuela’s June 1 visit to La Paz will jumpstart efforts to reach and sign a new bilateral framework agreement between Bolivia and the U.S.  A central point of contention continues to be broader transparency and ownership of development aid programs. However, it is not necessary to start from scratch to define how the two countries should structure, implement and monitor development assistance. Key international agreements—ratified by both Bolivia and the United States—including the Paris Declaration on Aid Effectiveness (2005) and the Accra Agenda for Action (2008),[i] provide clear and pragmatic guidelines for agencies’ relationships with host or “partner” countries. Most importantly, these accords guarantee host countries’ ownership and decision-making power over of development policy within their borders. The Bolivia-U.S. bilateral framework agreement should respect and directly reflect these principles.

Key elements of the Paris Declaration and the Accra Agenda:

  • Programs should be implemented through agreements between the donor and the recipient (partner) country;
  • Donors should not support or fund separate initiatives that could undermine the partner nation;
  • Donors and recipients should reach consensus on who will carry out and monitor development initiatives;
  • Cooperation should be carried out through existing host country institutions, not parallel structures formed by donors;
  • Hiring, procurement and implementation should comply with national legislation and procedures;
  • Development assistance should be made more efficient through improved “codes of conduct,” untying aid[ii] and greater “harmonization”[iii] or cooperation between host countries and donors;
  • Specific goals to be met by 2010.

The U.S. actively participated in the development of the Paris Declaration and the follow-up Accra Agenda, and heralded their approval:

“USAID Administrator Andrew Natsios — endorsed the Paris Declaration on Aid Effectiveness. The Paris Declaration commits donor and developing countries and institutions to continue and increase efforts in harmonization, alignment, and managing aid for results.” [iv]

“The United States is pleased with the new Accra Agenda for Action. It is a realistically ambitious agenda. It seeks to change the face of poverty and help developing nations to manage aid more effectively. […] Our President and our Congress demand […] that we use these precious taxpayer funds effectively.”[v]

Furthermore, Bolivia is part a special group of nations selected for monitoring progress towards compliance of the Declaration. An in-depth study, conducted in 2008, provided detailed indicators to facilitate implementation of the accords within Bolivia. [vi]

U.S. non-compliance out of step:  It’s time to rejoin the international community

Although the great majority of international donors to Bolivia have significantly revamped their procedures and practices to comply with these new development norms, USAID, once on the cutting edge of innovative development policy, has lagged far behind.  As a result, U.S. development policy is out of step with the rest of the international community. Continuing to insist on unilateral determination of development initiatives and granting predetermined project implementation units to private contractors – often U.S. based – violates the terms of the Paris Declaration and Accra Agenda and impedes collaboration with other international donors.  Furthermore, U.S. adherence to principles already accepted at the international level in a formal framework agreement with Bolivia would go a long way to mitigate the mistrust of the Morales administration.  The Bolivian government perception that USAID promoted a political agenda supporting opposition departmental governments contributed to the decision to expel Ambassador Goldberg in 2008.

Although new framework for bilateral relations would obligate USAID to significantly modify its operations in Bolivia, this request would bring the institution into compliance with pre-existing international norms, long ratified by the United States and long implemented by other international donors in the country. The Bolivian government must also continue to strengthen internal mechanisms to plan, implement, monitor and evaluate international aid. In short, it’s time for both the United States and Bolivia to sign a framework agreement that reiterates and confirms mutual commitments from the Paris Declaration, Accra Agenda and other international initiatives. Both nations must continue to work towards meeting the goals they committed to complete by 2010.

Other important principles in the Paris Declaration and Accra Agenda:

  • Partner countries exercise effective leadership over their development policies and strategies and coordinate development actions. [Paris Declaration.]
  • Country ownership is key. Developing country governments will take stronger leadership of their own development policies, and will engage with their parliaments and citizens in shaping those policies. [Accra Agenda for Action 8.]
  • Donors’ support for capacity development will be demand-driven and designed to support country ownership. To this end, developing countries and donors will i) jointly select and manage technical co-operation, and ii) promote the provision of technical cooperation by local and regional resources, including through South-South cooperation. [Accra Agenda for Action 14.b.]
  • In determining the most effective modalities of aid delivery, we will be guided by development strategies and priorities established by partner countries. [Paris Declaration I.5.]
  • Increasing alignment of aid with partner countries’ priorities, systems and procedures and helping to strengthen their capacities. [Paris Declaration I.3.ii.]
  • Reforming and simplifying donor policies and procedures to encourage collaborative behavior and progressive alignment with partner countries’ priorities, systems and procedures. [Paris Declaration I.3.v.]
  • Partner countries commit to exercise leadership in developing and implementing their national development strategies through broad consultative processes.
  • Partner countries commit to translate these national development strategies into prioritized results-oriented operational programs as expressed in medium-term expenditure frameworks and annual budgets.
  • Partner countries commit to take the lead in coordinating aid at all levels in conjunction with other development resources in dialogue with donors and encouraging the participation of civil society and the private sector. [Paris Declaration II.14.]
  • Donors commit to using a country’s own institutions and systems, where these provide assurance that aid will be used for agreed purposes, increases aid effectiveness by strengthening the partner country’s sustainable capacity to develop, implement and account for its policies to its citizens and parliament. [Paris Declaration II.17.]
  • Partner countries and donors jointly commit to: Work together to establish mutually agreed frameworks that provide reliable assessments of performance, transparency and accountability of country systems (Indicator 2). [Paris Declaration II.19.]
  • Donors commit to use country systems and procedures to the maximum extent possible. Where use of country systems is not feasible, establish additional safeguards and measures in ways that strengthen rather than undermine country systems and procedures. [Paris Declaration II.21.
  • The capacity to plan, manage, implement, and account for results of policies and programs, is critical for achieving development objectives – from analysis and dialogue through implementation, monitoring and evaluation. Capacity development is the responsibility of partner countries with donors playing a support role. [Paris Declaration II.22.]
  • Donors commit to rely to the maximum extent possible on transparent partner government budget and accounting mechanisms. [Paris Declaration II.26.]
  • Untying aid generally increases aid effectiveness by reducing transaction costs for partner countries and improving country ownership and alignment. [Paris Declaration II.31.]
  • Donors commit to align to the maximum extent possible behind central government-led strategies or, if that is not possible, donors should make maximum use of country, regional, sector or non-government systems.
  • Avoid activities that undermine national institution building, such as bypassing national budget processes or setting high salaries for local staff. [Paris Declaration II.39.]
  • A major priority for partner countries and donors is to enhance mutual accountability and transparency in the use of development resources. [Paris Declaration II.47.]
  • Donors commit to provide timely, transparent and comprehensive information on aid flows so as to enable partner authorities to present comprehensive budget reports to their legislatures and citizens. [Paris Declaration II.49.]
  • Donors will support them by respecting countries’ priorities, investing in their human resources and institutions, making greater use of their systems to deliver aid, and increasing the predictability of aid flows. [Accra Agenda for Action 8.]
  • Developing countries determine and implement their development policies to achieve their own economic, social and environmental goals. [Accra Agenda for Action 12.]
  • Developing country governments will work more closely with parliaments and local authorities in preparing, implementing and monitoring national development policies and plans. They will also engage with civil society organizations (CSOs). [Accra Agenda for Action 13.a.]
  • Donors agree to use country systems as the first option for aid programs in support of activities managed by the public sector. [Accra Agenda for Action 15.a.]
  • Donors will align their monitoring with country information systems. They will support, and invest in strengthening, developing countries’ national statistical capacity and information systems, including those for managing aid. [Accra Agenda for Action 23.c.]
  • We will make aid more transparent. Developing countries will facilitate parliamentary oversight by implementing greater transparency in public financial management, including public disclosure of revenues, budgets, expenditures, procurement and audits.
  • Donors will publicly disclose regular, detailed and timely information on volume, allocation and, when available, results of development expenditure to enable more accurate budget, accounting and audit by developing countries. [Accra Agenda for Action 24.a.]

Appendix: Paris Declaration List of Participating Countries and Organizations in 2005.

Updated list: www.oecd.org/dac/effectiveness/parisdeclaration/members

Participating Countries

Albania Australia Austria Bangladesh
Belgium Benin Bolivia Botswana
[Brazil]* Burkina Faso Burundi Cambodia
Cameroon Canada China Congo D.R.
Czech Republic Denmark Dominican Republic Egypt
Ethiopia European Commission Fiji Finland
France Gambia, The Germany Ghana
Greece Guatemala Guinea Honduras
Iceland Indonesia Ireland Italy
Jamaica Japan Jordan Kenya
Korea Kuwait Kyrgyz Republic Lao PDR
Luxembourg Madagascar Malawi Malaysia
Mali Mauritania Mexico Mongolia
Morocco Mozambique Nepal Netherlands
New Zealand Nicaragua Niger Norway
Pakistan Papua New Guinea Philippines Poland
Portugal Romania Russian Federation Rwanda
Saudi Arabia Senegal Serbia and Montenegro Slovak Republic
Solomon Islands South Africa Spain Sri Lanka
Sweden Switzerland Tajikistan Tanzania
Thailand Timor-Leste Tunisia Turkey
Uganda United Kingdom United States of America Vanuatu
Vietnam Yemen Zambia

*To be confirmed.

Participating Organizations

African Development Bank Arab Bank for Economic Development in Africa
Asian Development Bank Commonwealth Secretariat
Consultative Group to Assist the Poorest (CGAP) Council of Europe Development Bank (CEB)
Economic Commission for Africa (ECA) Education for All Fast Track Initiative (EFA-FTI)
European Bank for Reconstruction and Development (EBRD) European Investment Bank (EIB)
Global Fund to Fight Aids, Tuberculosis and Malaria G24
Inter-American Development Bank International Fund for Agricultural Development (IFAD)
International Monetary Fund (IMF) International Organization of the Francophonie
Islamic Development Bank Millennium Campaign
New Partnership for Africa’s Development (NEPAD) Nordic Development Fund
Organization for Economic Cooperation and Development (OECD) Organization of Eastern Caribbean States (OECS)
OPEC Fund for International Development Pacific Islands Forum Secretariat
United Nations Development Group (UNDG) World Bank

[i] Paris Declaration on Aid Effectiveness and the Accra Agenda for Action. http://www.oecd.org/dataoecd/30/63/43911948.pdf.  Other important international documents include the 2003 “Rome Declaration on Harmonization.” http://www.oecd.org/dataoecd/54/50/31451637.pdf.

[ii] According to the European Union, “Tied aid is aid given on the condition that the beneficiary will use it to purchase goods and services from suppliers based in the donor country.”Untying aid” therefore means opening up those purchases to suppliers based elsewhere than just in the donor country.”

http://europa.eu/legislation_summaries/development/general_development_framework/r12108_en.htm

[iii] Harmonization includes Implementation, “where feasible, common arrangements at country level for planning, funding (e.g. joint financial arrangements), disbursement, monitoring, evaluating and reporting to government on donor activities and aid flows.   Increased use of programme-based aid modalities can contribute to this effort” (Indicator 9 of the Paris Declaration).

[iv] USAID, “Guidance to USAID Field Missions Frequently Asked Questions: Delivering Organization for Economic Cooperation and Development Assistance Committee (OECD/DAC) Paris Declaration on Aid Effectiveness.” (Washington, D.C.: March 2006). http://pdf.usaid.gov/pdf_docs/Pdach113.pdf.

[v] This press statement continues, “The United States delegation succeeded in inserting into the Accra Agenda for Action (AAA) several concrete actions to significantly advance the implementation of the Paris Declaration so that partner developing countries would assume more ownership, accountability and partnership with U.S. foreign assistance….Broad country ownership, including governments, civil society and the private sector, is critical to aid effectiveness. […] The Accra Action Agenda recognizes the importance of country ownership and transparency in ensuring governments are accountable for their development outcomes,” stated U.S. Deputy Delegation Leader, Maureen Harrington of the Millennium Challenge Corporation. USAID Press Release: “Accra Action Agenda Finalized: A Realistically Ambitious Development Agenda” September 4, 2008.  http://www.usaid.gov/press/releases/2008/pr080904_1.html.

[vi] Better Aid.2008 Survey on Monitoring the Paris Declaration MAKING AID MORE EFFECTIVE BY 2010. OECD Full report: http://www.oecd.org/dataoecd/58/41/41202121.pdf.

Bolivia Chapter (in Spanish): http://www.oecd.org/dataoecd/34/40/42622450.pdf.