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History
Main article: History of Bolivia
Pre-colonial period
The Andean region probably has been inhabited
for some 5,000 years. Beginning about the 2nd
century B.C., the Tiwanaku culture developed at
the southern end of Lake Titicaca. This culture,
centered around and named for the great city of
Tiwanaku, developed advanced architectural and
agricultural techniques before it disappeared
around 1200 A.D., probably because of extended
drought (some legends of the Aymará, who claim
descendance from the inhabitants of Tiwanaku,
indicate that Lake Titikaka rose and flooded the
city, causing dispersal of the survivors).
Roughly contemporaneous with the Tiwanakan
culture, the Moxos in the eastern lowlands and
the Mollos north of present-day La Paz also
developed advanced agricultural societies that
had dissipated by the 13th century A.D. In about
1450, the Quechua-speaking Incas entered the
area of modern highland Bolivia and added it to
their empire. They controlled the area until the
Spanish conquest in 1525.
La
Paz
Sánchez de Lozada and Banzer: Liberalizing the
economy (1993)
Sánchez de Lozada pursued an aggressive economic
and social reform agenda. He relied heavily on
successful entrepreneurs-turned-politicians like
himself and on fellow veterans of the Paz
Estenssoro administration (during which Sánchez
de Lozada was Minister for Planning). The most
dramatic change undertaken by the Sánchez de
Lozada government was the "capitalization"
program, under which investors, typically
foreign, acquired 50% ownership and management
control of public enterprises, such as the state
oil corporation, telecommunications system,
airlines, railroads, and electric utilities in
return for agreed upon capital investments. The
reforms and economic restructuring were strongly
opposed by certain segments of society, which
instigated frequent and sometimes violent
protests, particularly in La Paz and the Chapare
coca-growing region, from 1994 through 1996. The
Sánchez de Lozada government pursued a policy of
offering monetary compensation for voluntary
eradication of illegal coca by its growers in
the Chapare region. The policy produced little
net reduction in coca, and in the mid-1990s
Bolivia accounted for about one-third of the
world's coca going into cocaine.
In the 1997 elections, Gen. Hugo Banzer, leader
of the ADN, won 22% of the vote, while the MNR
candidate won 18%. Gen. Banzer formed a
coalition of the ADN, MIR, UCS, and CONDEPA
parties which held a majority of seats in the
Bolivian Congress. The Congress elected him as
president and he was inaugurated on August 6,
1997.
The Banzer government basically continued the
free market and privatization policies of its
predecessor, and the relatively robust economic
growth of the mid-1990s continued until about
the third year of its term in office. After
that, regional, global and domestic factors
contributed to a decline in economic growth. Job
creation remained limited throughout this period
and the public perceived a significant amount of
public-sector corruption. Both factors
contributed to increasing social protests during
the second half of Banzer's term.
At the outset of his government, President
Banzer launched a policy of using special police
units to physically eradicate the illegal coca
of the Chapare region. The policy produced a
sudden and dramatic 4-year decline in Bolivia's
illegal coca crop, to the point that Bolivia
became a relatively small supplier of coca for
cocaine. The MIR of Jaime Paz Zamora remained a
coalition partner throughout the Banzer
government, supporting this policy (called the
Dignity Plan).
On August 6, 2001, Banzer resigned from office
after being diagnosed with cancer. He died less
than a year later. Banzer's U.S.-educated Vice
President, Jorge Fernando Quiroga Ramírez,
completed the final year of the term. Quiroga
was constitutionally prohibited from running for
national office in 2002 but could do so in 2007.
In the June 2002 national elections, former
President Gonzalo Sánchez de Lozada (MNR) placed
first with 22.5% of the vote, followed by
illegal-coca advocate and indigenous campesino
leader Evo Morales (Movement Toward Socialism,
MAS) with 20.9%. Morales edged out populist
candidate Manfred Reyes Villa of the New
Republican Force (NFR) by just 700 votes
nationwide, earning a spot in the congressional
run-off against Sánchez de Lozada on August 4,
2002.
A July agreement between the MNR and the
fourth-place MIR, which had again been led in
the election by former president Paz Zamora,
virtually ensured the election of Sánchez de
Lozada in the congressional run-off, and on
August 6 he was sworn in for the second time.
The MNR platform featured three overarching
objectives: economic reactivation (and job
creation), anti-corruption, and social
inclusion.
Social Crisis and the nationalization of
hydrocarbon resources (2001-2005)
In September 2001, following the advice of the
World Bank, the Bolivian government declared
that all water was to become corporate property,
so that even drawing water from community wells
or gathering rainwater on their own properties,
peasants and urban dwellers had to first
purchase and obtain permits from International
Water Limited (a multinational largely owned by
the Bechtel Corporation). The government,
however, retracted and abolished the new water
privatization rules following wide-scales
uprisings and riots in protest of the
legislation. 1-2
During, February 2003, four-year economic
recession, tight fiscal situation, and
longstanding ethnic tensions mounted again in a
police revolt that nearly toppled the government
of President Sánchez de Lozada; several days of
unrest left more than 30 persons dead. The
government stayed in power but remained
unpopular. Widespread protests broke out in
October and revealed deep dissatisfaction with
the government. Approximately 80 persons died
during the demonstrations which led President
Sánchez de Lozada to resign from office on
October 17. In a constitutional transfer of
power, Vice President Carlos Mesa assumed the
Presidency and promised to hold a binding
referendum on the export of Bolivian natural
gas. The referendum took place on July 18, and
Bolivians voted overwhelmingly in favor of
development of the nation's hydrocarbon
resources. Mesa planned to detail the
government's development plans in legislation to
be introduced to Congress. Mesa enjoyed
popularity with the Bolivian public, but he
faced the same difficulties — social divisions,
a radical opposition committed to
extra-parliamentary action, and an ongoing
fiscal deficit — as the previous administration.
On June 6, 2005, President Carlos Mesa was
forced to enter his resignation as over 80,000
protestors surrounded the presidential palace
and congress demanding nationalization of the
gas industry. The indigenous protestors argued
that indigenous communities, two thirds of
Bolivia's population, were not adequately
represented in government. Consequently, the
campesinos and indigenous population, angered by
the inequitable dividends paid by the
multinational petroleum companies, set up
roadblocks throughout the country and placed all
the major cities under siege. With Carlos Mesa
stranded in the Palace of Plaza Murillo, the
congress and senate closed, protestors roamed
through the streets of La Paz threatening to
drive the "corbateros" (those clothed in suits
and ties) from the country.
A civil war was averted when, on June 9th, 157
members of the congress and senate converged on
the Casa de La Libertad in Sucre, Bolivia and
nominated Eduardo Rodriguez, the current
President of the Supreme Court, to the
Presidency at the eleventh hour. President
Rodriguez, to avert a civil war, has promised to
hold new national elections in December of 2005.
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