Thursday, October 23, 2008

Are thousands of Bolivian jobs at stake?

Today, a Bolivian delegation made up of prominent government officials and business leaders is in Washington. They will testify in a public hearing hosted by the United States Trade Representative (USTR) about the economic benefits of the Andean Trade Preferences and Drug Elimination Act (ATPDEA), an arrangement that gives several Bolivian products preferential access to the U.S. market. The Bush administration suspended Bolivia's ATPDEA trade preferences in late September, dealing a potential blow to the country's economy.

The Bolivian delegates are making the case for the U.S. program's importance for alternative development in coca-growing regions, and job creation nationwide. They are also seeking to defend the Bolivian government's counternarcotics program, which the Bush administration, in a September "de-certification" decision, determined does not meet its standard for full cooperation toward anti-drug goals.

The delegation is led by Bolivian Treasury Minister Luis Arce and Vice Minister of Social Defense and Controlled Substances Felipe Cáceres (whose position is similar to that of the U.S. drug czar), and includes the president of the La Paz Chamber of Exporters, Guillermo Poumont, the president of the Confederation of Private Business in Bolivia, Gabriel Babdoub and other business owners who export their products to the United States. Also, the hearing will include video testimony, compiled by the Cochabamba, Bolivia-based Democracy Center, of three Bolivian workers who will be adversely affected by the decision to suspend Bolivia's trade preferences with the United States.

According to the General Manager of the La Paz Chamber of Exporters, Fernando López, "it is important that we clearly demonstrate that Bolivia is carrying out good work in terms of counternarcotics" in addition to showing how ATPDEA is important for the Bolivian economy.


At the end of September, President Bush announced his plans to suspend Bolivia's trade preferences under the Andean Trade Promotion and Drug Eradication Act due to Bolivia's failure to cooperate fully with the United States's counternarcotics programs, despite Congress' vote to extend ATPDEA preferences to Bolivia for six months. As required by law, the USTR must post the president's announcement in the Federal Register, hold a public hearing on the topic, and accept public comments until the end of the month (a .pdf of the announcement can be found here).

At the end of the month, the Bush Administration and the USTR will take into account the testimonies at the public hearing and formal comments submitted by outside parties, and a final decision will be made as to whether President Bush will maintain his decision to suspend trade preferences to Bolivia or if they will revert to the decision agreed upon by Congress to extend Bolivia's ATPDEA preferences for six months.

As discussed on this blog before, the suspension of trade preferences under ATPDEA will have a detrimental effect on the Bolivian economy. Approximately 25,000 (U.S. government estimate) to 50,000 (Bolivian government estimate) Bolivian jobs rely on trade with the United States made possible by ATPDEA - a significant percentage of the formal-economy workforce in a country whose entire population is under 10 million. Much of this employment is in the sprawling working-class city of El Alto, on the margins of La Paz, where the country's textile industry is based. The government is also concerned that the loss of these jobs could cause an increase in out-migration to other countries such as Argentina, Brazil and Spain.

In response to the pending suspension of ATPDEA, Bolivian President Evo Morales has said "We don't have to be afraid of an economic blockade by the United States against the Bolivian people." Instead he has announced that Venezuelan President Hugo Chávez has offered to replace and even surpass the income that ATPDEA generates for Bolivia and that the Iranian Government is interested in buying the products that will no longer be for eligible to enter the United States duty-free.

Bolivian Chancellor David Choquehaunca has claimed that Bush's announcement is not the "final word" and classified his decision as "entirely political" - a result of Bolivia's September expulsion of the U.S. ambassador, rather than a consequence of anti-drug strategy. However, we will have to wait to see whether Chancellor Choquehaunca's words turn out to be true, whether President Bush is going to stick to his initial decision and suspend Bolivia's trade preferences under ATPDEA as of January 1, 2009, and if so, whether President Bush's successor continues the suspension next year.

Tuesday, October 14, 2008

Russia strengthens ties with Latin America

Over the past month, the U.S. and regional press has been paying closer attention to Russia's relations with such Latin American countries such as Venezuela, Bolivia, Nicaragua, Cuba and even Colombia.

In September, Russian Vice-Prime Minister Igor Sechin traveled to Venezuela, Nicaragua and Cuba to meet with his counterparts in each country to discuss the potential increase in economic, military, and political cooperation between each country and Russia. In September, two Russian T-160 strategic bombers visited Venezuela for a joint military exercise and a Russian navy squadron is currently en route to the Caribbean for joint exercises with the Venezuelan navy. Russia also has begun preliminary discussions with Cuba to help the country develop its own space center, has announced it will replace the Nicaraguan army's aging weaponry, and has started talks with Venezuela about developing a peaceful nuclear energy program.

Bolivian President Evo Morales recently announced that he will seek Russia's aid for the country's counternarcotics program, and Colombia's Defense Minister Juan Manuel Santos even traveled to Russia to discuss defense and counternarcotics cooperation.

Below are links to media coverage from the past month about Russia's renewed interest in Latin America. With the exception of the Venezuelan-Russian military exercise, U.S. officials have sought to downplay this interest in their public statements. It is apparent, however, that the U.S. government is watching these developments closely.


The Guardian: The cold war comes to the Caribbean

Front Page Magazine: Chávez's dangerous liaisons

Semana (Colombia): Calentando la guerra fria: Heating up the cold war

New Statesman: Cuban missile crisis II?


El Universal (Venezuela): Presidente Dmitri Medvedev visitará Venezuela en noviembre: President Dimitri Medvedev will visit Venezuela in November

AP: Russia: Arms sales to Venezuela are defensive

AFP: Cooperación nuclear entre Moscu y Caracas desata la pol?©mica: Nuclear cooperation between Moscow and Caracas unleashes controversy

AP: Venezuela to build nuclear technology with Russia

New York Times: Russia loans Venezuela $1 billion for military

Reuters: Putin offers nuclear energy help to Chávez

BBC: Russia and Venezuela boost ties

AP: Putin, Chávez discuss ways to constrain U.S. power

EFE: Hablan Chávez y Medvedev de cooperación economía y militar: Chávez and Medvedev discuss economic and military cooperation

AP: Crece alianza Venezuela-Rusia: Venezuelan-Russian alliance grows

New York Times: Russia and Venezuela confirm joint military exercises


AP: Russia to modernize Nicaraguan military's arsenal

El Nuevo Diario (Nicaragua): Condoleezza despectiva con Ortega: Condoleezza derogatory toward Ortega

El Nuevo Diario: Viceprimer ministro de Rusia visitará este miercoles Nicaragua: Russian Vice-Prime Minister to visit Nicaragua on Wednesday


Reuters: Russia to help Cuba build space center


AP: Ambassador: Russia looking to boost Bolivia ties

BBC Mundo: Bolivia y Rusia, nuevos aliados: Bolivia and Russia, new allies

La Prensa (Panama): Bolivia busca apoyo de Rusia: Bolivia looks for Russian support


El Espectador (Colombia):Moscu propone a Colombia combatir el creciente trafico de cocaína: Moscow makes a proposal to Colombia to combat the rise in narcotrafficking

El Tiempo (Colombia): Fortalecer cooperacion de seguridad, objetivo de viaje del Ministro de Defensa a Rusia: Strengthening security cooperation, objective of the Defense Minister's trip to Russia

Monday, October 6, 2008

President Bush suspends Bolivia's trade preferences under ATPDEA

Last week, both the House and Senate voted to extend the Andean Trade Promotion and Drug Eradication Act (ATPDEA) for Bolivia, Colombia, Ecuador, and Peru. (ATPDEA is a trade preference system by which these four countries are granted duty-free access to a wide range of exports, with the goal of promoting economic development and providing alternatives to the production of cocaine.) While the House version granted a one-year extension to all four countries, the version of the bill passed by the Senate granted a one-year extension to Colombia and Peru and a six-month extension to Ecuador and Bolivia. A final, reconciled bill awaits approval.

For Bolivia, however, the outcome of Congress' decision on the matter may not make a difference.

On Friday, September 26, President Bush enacted his presidential powers as outlined under the terms of the law, requesting that Bolivia's designation as a beneficiary country under ATPDEA be suspended. Under the terms of the agreement, the President may withdraw or suspend the designation of a country as a beneficiary country if the country is not satisfying the eligibility criteria. According to the United States Trade Representative (USTR), the White House's decision is based on the designation of Bolivia, on September 15, 2008, as a country that has failed demonstrably to cooperate with counternarcotics efforts. As outlined in a USTR press release,

the recent expulsion of U.S. Agency for International Development personnel and the removal of U.S. Drug Enforcement Administration officials from the main areas of Bolivia's illegal coca production, a marked increase in cocaine production, the government's failure to close illegal coca markets, and publicly stated policies that increase government-sanctioned coca cultivation, have placed in doubt the Bolivian government's commitment to cooperate in the fight against drug trafficking.

President Bush's decision has received criticism from OAS Secretary General José Miguel Insulza, who said that the suspension of trade preferences by the United States "will gravely harm many small Bolivian industries that survive on exportations of their products to the United States, and could leave more than 50,000 Bolivian workers without jobs." Other sources, such as Bolivia's La Razón and Los Tiempos, cite a loss of anywhere between 5,000 - 80,000 jobs.

According to U.S. Trade Representative Susan Schwab, the United States "regret[s] that the proposed suspension that is prompted by the Bolivian government's actions could affect hard-working Bolivians.... Once imposed, the suspension could be lifted as soon as the Bolivian government improves its performance under the ATPA and ATPDEA criteria" (i.e. proves that it is cooperating with the United States' counternarcotics efforts). However, Bolivian President Evo Morales has said that "dignity is more important and we cannot give in or back down," giving the impression that Bolivia's counternarcotics efforts will not change to fall in line with the policies of the United States, despite warnings by the Bolivian Institute of International Trade (IBCE) that this could be "terrible . . . for the manufacturing sector."

Not only could President Bush's decision to suspend trade preferences with Bolivia lead to the unemployment of 2% of the country's total workforce, but it is also unknown if it will lead to a change in the way Bolivia conducts its counternarcotics strategy. As outlined on this blog before, Bolivia's counternarcotics results have not differed much from that of two governments friendly to the United States, Peru and Colombia, and the U.S. decision to "decertify" Bolivia came at a time of worsening diplomatic relations between Bolivia and the United States.

In accordance with the ATPDEA agreement, a public hearing must be held on the proposed action to suspend trade preferences to Bolivia, which will take place on October 23rd. However, as it looks right now, Bolivia will be removed from the list of ATPDEA designated countries at least through the end of the Bush administration in January 2009.

Thursday, September 18, 2008

United States: Bolivia does not cooperate with the drug war

Last week, we speculated about whether Bolivia would be placed on the United States' list of countries who have "failed demonstrably" to cooperate with U.S. anti-narcotics policy and the implications this might have, especially when comparing coca production and eradication and seizure levels of Bolivia with those of Peru and Colombia - top U.S. allies in the region. This week, the White House issued the "Majors List" of narcotics source and transfer countries for 2008, and Bolivia had been added to the "non-cooperating" list, which last year only included Venezuela and Burma.

Below are two charts that lay out both coca cultivation and cocaine production levels in Bolivia since 1994. The U.N data used to create these charts show a 5% increase in coca cultivation and an increase in cocaine production from 94 to 104 tons in 2007. These numbers differ from those cited by Assistant Secretary of State David Johnson at a press conference this week, held upon the release of the 2008 list. In criticizing Bolivian President Evo Morales' drug policies, Assistant Secretary Johnson said "The expansion of cultivation and lack of controls on coca leaf resulted in a 14% increase in the area of coca under cultivation, and an increase in potential cocaine production from 115 to 120 metric tons." Regardless, while these numbers do show a rise in the amount of coca and cocaine in Bolivia, the increases are not outstanding, especially in comparison to Colombia and Peru's cultivation and production numbers.

The addition of Bolivia to the "non-cooperating" list, however, comes at a time of tense relations between the governments of the United States and Bolivia. Just last week, Bolivia expelled the U.S. ambassador, claiming that he was conspiring with the opposition. The United States retaliated by expelling the Bolivian ambassador the next day.

At the press conference, Assistant Secretary Johnson noted that the addition of Bolivia to the list was not "a hasty decision" in retaliation for the expulsion of the U.S. ambassador, but instead cited "the [drug] policies that they are pursuing, capped off by the expulsion, if you will, of the USAID program in Chapare [a coca-growing region in central Bolivia] for alternative development, as well as the assistance program provided by our Drug Enforcement Administration, made the conclusion rather clear."

Here is a timeline of the deterioration of U.S.-Bolivia relations since last fall.

August 2007: Bolivian Minister Juan Ramon Quintana accuses the United States of using USAID funds to finance opposition groups.

November 2007: The Bolivian government passes around a photograph of U.S. Ambassador Goldberg with John Jairo Venegas, a Colombian accused by Bolivia of being a member of the Colombian right-wing paramilitary squads.

October 2007: In reaction to a campaign supported by President Morales to relocate the UN headquarters, Ambassador Goldberg publicly announced that he wouldn't also be surprised if Evo Morales asked for Disney Land to be moved.

February 2008: U.S. embassy official Vincent Cooper was accused of asking an American student and Peace Corps volunteer to spy on Venezuelans and Cubans in Bolivia.

June 9, 2008: Thousands of Bolivian protesters marched on the U.S. Embassy to demand that Washington extradite a former Bolivian defense minister who directed a military crackdown on riots that killed at least 60 people in 2003.

The United States recalled Ambassador Goldberg in reaction to the protests.

June 26 2008: The Chapare coca growers unions announced that they will no longer sign new aid agreements with USAID, as a result of the repeated accusations against USAID made by President Morales.

In reaction, the United States removes USAID personnel from the Chapare region, while President Morales praises the coca growers for kicking out the U.S. agency.

August 2008: Due to frustration with the way the U.S. spends money to fight cocaine production in Bolivia, drug czar Felipe Caceres announces that the Bolivia government will "nationalize the war against drug trafficking." And adds that "we will still welcome cooperation in the future, but the Bolivian government will decide how that money will be spent."

September 11, 2008: President Morales again accuses Ambassador Goldberg of working with the opposition, and orders the U.S. Ambassador to leave Bolivia. In 'solidarity' with Bolivia, Venezuelan President Hugo Chávez also orders the U.S. Ambassador to leave his country.

The United States reacts by expelling the Bolivian Ambassador.

September 16, 2008: The United States adds Bolivia to the list of countries who have "failed demonstrably" to cooperate with U.S. anti-narcotics policy.

Sunday, September 14, 2008

Bolivia's Crisis

Protests and demonstrations in Bolivia grew increasingly violent this week. Opponents of President Evo Morales in the resource-rich eastern provinces are pressing harder with autonomy demands after a recent recall referendum ratified both Morales and regional governors who oppose him. The latest protests have resulted in numerous casualties and significant property damage.

President Morales’ reaction has included lashing out against the United States, including Tuesday’s expulsion of the U.S. ambassador, who had met with one of the opposition governors several days earlier. Venezuela followed suit by expelling its U.S. ambassador, and the U.S. government responded by sending home both countries’ ambassadors to Washington.

The week ended with dramatically worsened relations between Bolivia and the United States and increasing speculation about the possibility – still remote – that Bolivia’s political violence could come to resemble civil war.

Links for More Information:

Analysis of the Protests

Information on Casualties and Damages

Regional Responses to the Protests:

The European Union’s Response:

The Bolivian Response:

The Venezuelan Response:

The United States’ Response:

Potential Resolution or Dialogues:

Wednesday, September 10, 2008

U.S. questions Venezuelan and Bolivian counter-narcotics strategies

Every year, the President is required by the Foreign Assistance Act of 1961 to submit to Congress an annual report identifying (a) major drug-producing or transit countries and (b) those countries not "cooperating" with U.S. counternarcotics measures and subject to sanctions. Using the "International Narcotics Control Strategy Report" published by the Bureau for International Narcotics and Law Enforcement Affairs (INL) every March, the "Majors List" is compiled each year and presented to the Secretary of State for consideration before being approved by the President and sent to Congress.

Of the twenty countries that made the "Majors List" last year, only Venezuela and Burma were found to have "failed demonstrably" to cooperate. While making it to the second "non-cooperating" list stipulates that a country not receive U.S. assistance under the foreign operations appropriations act, the President can reinstate assistance if the "provision of such assistance is vital to the U.S. interests." Last year, President Bush determined that while Venezuela "failed demonstrably" to cooperate, "support for programs to aid Venezuela's democratic institutions is vital to the national interests of the United States," and therefore assistance was not revoked.

This yearly process is going on right now and we should expect to see the list for 2009 sometime next week, which coincides with a recent increase in coverage of the United States' criticism of Venezuela's and Bolivia's drug policies. While Venezuela and Burma are most likely to make the "non-cooperating" list for 2009, Bolivia is a wild card.

Recent U.S. criticism of Venezuela:
According to Reuters, the United States accused Venezuela's government "of failing to fight back against drug gangs moving huge amounts of cocaine through the South American country." This criticism stems from the decline in drug seizures from 63 tons in 2005 to 35 tons in 2007 and what the United States has cited as being a "more than 16-fold increase in the amount of cocaine departing Venezuela by air since 2002." The dispute continued, with President Chavez threatening to kick the U.S. ambassador out of the country and dismissing White House drug czar John Walters' criticisms as 'stupid'. According to the an Associated Press article, Chavez insists "that Venezuela doesn't need U.S. help in fighting drug trafficking" and that Venezuelan Vice President Ramon Carrizalez said that "Venezuela is cooperating internationally - just not on the U.S. Drug Enforcement Administration's terms."

Recent U.S criticism of Bolivia:
Under President Evo Morales, Bolivia has adopted a "zero cocaine, but no zero coca" policy, allowing for the cultivation of nearly 30,000 acres of coca for traditional uses, a policy which, according to Reuters, the United States has described as "permissive." However, the United States has started to critize Bolivia's drug policy as a result of a recent UN report on coca cultivation in the Andes region, which measures the cultivation in Bolivia increased by 5% in 2007 and covers 71,660 acres.

A recent article in El Espectador shows that despite the increase in drug-seizures in Bolivia from 18 tons in 2007 to 19.5 tons between January and August 2008, the U.S. government "considers that the increase in confiscations only is proportional to the increase in the production of coca" and the New York Times quoted a U.S. official saying "Let's put it this way: [Bolivia's] going in the wrong direction," in reference to Morales' drug policies.

While coca cultivation in Bolivia did increase in 2007, the UN report shows that coca cultivation also increased by 27% in Colombia and by 4% in Peru, two of the United States' main allies in the region, while confiscations increased 29% in Bolivia and decreased by 9% in Colombia and 30% in Peru. Bolivia remains far behind Colombia in increased coca cultivation and has improved its capacity to confiscate drugs in route, yet Bolivia is still being scolded by the United States.

Whether or not Bolivia makes it on the "failed demonstrably" to cooperate list, the recent U.S. criticism of President Morales' drug policies and belittling of Bolivia's increase in drug seizures so far in 2008 in light of the records of Peru and Colombia makes us wonder if all of this is just because Bolivia wants to pursue a different, yet effective, drug control approach, rather than do everything the United States asks?

You can read more of the recent coverage of the United States' criticism of both Venezuela's and Bolivia's drug policy here.

Thursday, July 24, 2008

U.S. relations, seen from Bolivia

Here is how the Bolivian government's press agency (Agencia Boliviana de Información, ABI) portrayed yesterday's visit to La Paz of Thomas Shannon, the assistant secretary of state for Western Hemishere Affairs. The citations below come from three different press releases (1, 2, 3).

The U.S. and Bolivian governments agreed on Wednesday to begin a plan of consultations to establish a bilateral agenda with the objective of reinvigorating relations between La Paz and Washington.

That was the message of the assistant secretary for Western Hemisphere Affairs of the United States, Thomas Shannon, after meeting with Bolivian President Evo Morales, in a meeting that began at 5:05 in the morning [!!!] in the Palacio Quemado and lasted until 6:45.


"In the end it was agreed that the only conspiracy that is going to existi in our bilateral relations will be the conspiracy against poverty, against inequality and against social exclusion," Shannon affirmed.

This was in response to [Bolivian President Evo] Morales' repeated denunciations of a presumed conspiracy against his government from the U.S. embassy, represented in La Paz by Philip Goldberg.

The government accuses Goldberg of directing and financing the Bolivian political right wing's conspirings.

Consulted on this point, the U.S. official affirmed that "we could not have a better ambassador in La Paz, he is a very respected diplomat in Washington."

For his part the Bolivian minister of Foreign Relations, David Choquehuanca, in a press conference, said that it was Morales who proposed to the U.S. mission "to conspire together against poverty, social exclusion and inequality" and that this was well-received by the U.S. delegation.

In addition, [Choquehuanca said] that Shannon "has been asked that the United States stop conspiring politically in Bolivia."


"We recognize the government's great effort in different aspects of its work that are important for the United States, especially in the fight against drugs," Shannon indicated in a press conference at the Palacio Quemado, after meeting with the president of Bolivia, Evo Morales.


Shannon affirmed that his country will keep seeking ways to deepen assistance for interdiction, eradication and especially the alternative-development programs carried out by the U.S. Agency for International Development (USAID).

However, in June this agency was expelled from the Chapare region of Cochabamba by coca-leaf producers, who accuse it of conspiring against the government of President Evo Morales.

In the case of the Yungas, another coca-producing region, USAID's work is continuing.

Shannon said that the meeting with Morales made clear that the U.S. delegation in La Paz is taking no political actions, and that the only U.S. conspiracy is the one against poverty, inequality and social exclusion.

Friday, July 18, 2008

Civil-Military Relations Roundup

Argentina's defense minister, Nilda Garré, and president, Cristina Fernández de Kirchner, at the annual civil-military "comradeship dinner."
  • Argentina: [A possible military pay raise] will be the central point at the traditional military dinner [the annual "comradeship dinner"], in which the entire national cabinet, Supreme Court judges and legislators share tables with the main military commanders. The appearance of the salary question as a fundamental concern at all levels, at a moment of political upheaval [Argentina's agricultural crisis], is taken by the officers as a symbol that the barracks' doors are closed, and have been for many years, to coup-plotting adventures. With no greater crises in view, the dinner's climate will be marked by a possible announcement about salaries."
  • Argentina: "The Minister of Defense ordered the Army High Command to relieve three officers of their command in the V Infantry Brigade (Salta), if it is proven that they tried to destroy a guard logbook in that city's Military Hospital. ... In the hospital was found a guard logbook corresponding to the 1976-1983 military dictatorship period."

  • Bolivia: "The government last night accused the Podemos and UN opposition parties of trying to split the armed forces and seek to pit them against the police, through a Senate committee's investigation of a [dynamite] attack on a communication medium [television station] in Yacuiba. ... They denied that Army Lieutenant Georges Nava, who is detained with 11 other people, is responsible for the deed. ... Yesterday [July 8] information on Nava's flash memory came to light indicating that the [Morales] government has the unconditional support of perhaps only three of the 56 regimental commanders."
  • Brazil: "250 soldiers began to leave [Rio de Janeiro's violent Providencia favela], obeying the order of a federal judicial tribunal that considered soldiers' participation in police functions to be unconstitutional. On Thursday June 26 the Federal Regional Tribunal's deadline for the Army to vacate the area completely will expire. The soldiers' presence to support a project sponsored by a political ally of Brazil's president, Luiz Inácio Lula da Silva, was strongly criticized by the opposition, the press and Providencia's own inhabitants. The neighborhood's residents organized violent protests against the soldiers who had been there, accusing them of abuses of power and of being allies of narcotrafficking gangs.
  • Guatemala: "In his speech, [President Álvaro Colom assured that his government will support itself on 'a new modernized Army to recover diverse geograhic areas of the country' that are under the influence of organized crime gangs."

  • Mexico: "The debacle in Santiago in Sinaloa state, a stronghold of drug traffickers, is one of a series of blunders by Mexican soldiers waging a bloody campaign against narcotics cartels — a crackdown that the U.S. Congress is looking at supporting with up to $1.6 billion. Since President Felipe Calderon took office in December 2006 and sent out 25,000 troops to take on the mafias, soldiers have killed at least 13 unarmed civilians."
  • Peru: "A debate blew up in Peru after the government's decision to send the armed forces into the streets to reinforce security in the face of a July 9 national strike, in the belief that demonstrators opposing President Alan García will commit acts of violence."
  • Venezuela: "Venezuelan military officers have expressed growing alarm at attempts by President Hugo Chávez to turn the armed forces into a political instrument of his socialist revolution."
  • Venezuela: "Hundreds of Venezuelan military officers are no longer assigned duties and have been relegated to their homes, quietly pushed aside for their dissent under President Hugo Chavez, according to former military commanders and a watchdog group."
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