President Morales has announced plans to commence a new era in Bolivian mining in 2007. The year 2006 saw the highest mining revenue since 1985 and exports jumped from $346 million in 2005 to over $1 billion in 2006. Increased demand for minerals, in large part c from China and India, has revitalized the Bolivian mining sector.  Price increases on the world market for Bolivia’s most profitable metals – zinc, silver, tin, and gold – has heightened hopes that mining can again become a dominant industry, as it had been for most of the nation’s history.  If the reactivation of the industry and tax reform can be structured and implemented effectively, the current mining boom could benefit most Bolivians for the first time.

The Morales administration has promised that greater mining income, in addition to increased hydrocarbon revenues, will fund social and health programs for citizens throughout Bolivia. However, the potential profit gains and greater state control have both raised expectations and anxieties of other interested groups. Private mining companies anticipate that skyrocketing demands for minerals will bring increased profits but fear that the state will expropriate their investments through the nationalization process. Communities most affected by mining, some of the most polluted and impoverished regions, hope that the reactivation of the mining sector and greater state control will guarantee greater benefits for their communities. Environmentalists worry that without greater environmental protection, exploitation of new mines will worsen water contamination and other environmental conditions in the world’s eighth most biologically diverse country.  

The diverse groups of miners are also struggling, amongst themselves and with the government, to determine who will receive the rights to work in the mines and on what terms.  Follow the links below to read the complete three part series on Bolivia’s mining sector from the Andean Information Network.  

Part I

Cooperative Miners in the Nationalization Process: Explosive Politics

On May 1, 2007, one year after the “nationalization” of the hydrocarbons industry, Bolivian President Evo Morales declared all Bolivian territory a public mining reserve and reasserted that all minerals, metals, precious and semi-precious stones are under the jurisdiction and power of the State mining company, Bolivian Mining Corporation (COMIBOL), excluding concessions granted before the decree.

Part II

An Emerging Mining Policy for Bolivia

On May 1, 2007, one year after the “nationalization” of the hydrocarbons industry, Bolivian President Evo Morales declared all Bolivian territory a public mining reserve and reasserted state jurisdiction and control over all minerals, metals, precious and semi-precious stones. The state mining company, Bolivian Mining Corporation (COMIBOL) now administers all mineral wealth except concessions granted before the decree.  The decree also requires that the National Geological and Technical Mining Service complete a study previously unexplored and prospected areas to give the government and COMIBOL a more precise assessment of the vast mineral wealth within the nation’s borders. The decree prohibits granting further concessions, and freezes those currently under negotiation until a study can be completed.¹

Part III

Bolivia’s Mining Rollercoaster: Negotiating Nationalization

Evo Morales became president with an electoral mandate to reclaim state control over the nation’s natural resources.  For Bolivia’s mining sector, this means maintaining a balance between the interests of cooperative miners, attracting much needed foreign investment and increasing the State’s take on the earnings. This update on the nationalization of Bolivia’s mines is the third in a three part series on Bolivia’s mining sector from the Andean Information Network.  

Bolivia’s cooperative mining union, FENCOMIN, has again demonstrated its formidable political power, forcing the Morales administration to guarantee its right to mine and to give them access to more lucrative mining areas — apparent concessions to the new nationalization program.  The MAS government is also negotiating a new tax plan which seeks to maintain foreign investment while giving the state a larger stake of the earnings.