Flammable Societies by McNeish John-Andrew;Logan Owen;

Author:McNeish, John-Andrew;Logan, Owen;
Language: eng
Format: epub
Publisher: Pluto Press

BEGINNING A NEW PROCESS OF REFORM

Faced with the resignation of President Sanchez de Lozada in 2003, Carlos Mesa, the vice-president, assumed the presidency. Events had made it clear that the country needed to solve two problems as quickly as possible: that of sovereignty, associated with the issue of ownership of hydrocarbon production, and that of the structure of state participation in hydrocarbon rents.38 Ex-president Mesa recognised this fundamental challenge when he stated:

A referendum on hydrocarbons was essential because the export of gas and the law had become the great problem that was at the brink of setting the country on fire … not only was the issue of exportation on the table, but also the central ideological question of our natural resources. Two visions faced off against one another.39

Once again, the two confronting visions were the liberal and the statist.

The intensity of the events that had taken place meant that one of the priorities of the new government was to call a referendum. Nonetheless, this happened without sufficient public debate to allow citizens to make decisions based on clear conceptual principles and accurate technical and economic knowledge.

Five questions were asked in a national referendum. These focused on (1) disapproval of Law 1689 of 1996; (2) the return to state ownership of hydrocarbons at the wellhead; (3) the refounding of the YPFB, giving it the capacity to participate in the entire hydrocarbon productive chain; (4) the use of gas as a strategic resource to recover sovereign and useable access to the Pacific Ocean; and (5) the export of gas in the framework of a national policy that (a) covered Bolivian gas consumption; (b) promoted industrialisation of gas in the national territory; and (c) charged taxes and/or royalties on petroleum companies, reaching 50 per cent of the value of gas, and directing it principally towards education, health, roads and jobs.

Although the consultation brought together issues of national interest, it left open a wide range of possibilities for its solution, which indicated the absence of a project to direct discussion. In short, there was consultation on the elimination of one model of management without taking the time necessary to create the basis for what would be the new model of management and development of the hydrocarbons industry. Moreover, no position was taken on the role of investment and the objective possibilities of exposing the state to financial risk.

Support for the principles formulated in the consultation nonetheless brought to light a manifest desire, at the national level (a) to strengthen YPFB and promote its active participation in the hydrocarbon chain, and (b) to establish a regime of more equitable state participation in rents, supported by a structure of direct capture (better understood and conceived by the population as an element to guarantee greater revenue collection).

Faced with this scenario, it was up to the political system not only to collect, but also to ‘interpret’ the national will, and ‘process’ this will into a legal body. Supported by the results of this consultation, Mesa presented a bill to Congress that included a proposal for direct and progressive complementary taxes.

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