No “Crisis” with Bolivian Gas

Evo Morales has found a way to get Bolivia on the front pages of the U.S. media: Send in the soldiers to take over the country’s oil fields.

The dramatic action garnered major attention, and quickly a major backlash, with foreign governments and industry analysts saying Bolivia was jeopardizing its ability to attract and maintain desperately needed foreign investment.

Actually, although the soldiers’ involvement increased the drama, Morales’ action was a lot less bold than generally portrayed, and its ultimate meaning still very much up for grabs.

As Gretchen Gordon recently reported for Multinational Monitor, every leading candidate in Bolivia’s recent election promised to nationalize the gas industry. Morales was just delivering on a campaign promise.

What “nationalization” will mean in practice is very much up for grabs. Foreign companies will continue to have a role in Bolivia’s gas industry, it seems, but perhaps the recent giveaways of the country’s resource assets will be undone, in part at least.

There’s lots of talk now about the foreign companies pulling out — and Brazil’s Petrobas today has stated that it will freeze new investments in Bolivia — but the fact is that the companies can still do quite well even if they receive a dramatically lower take, as Gordon explained in her article.

More sensible talk to break through the industry analyst blowhards is available from Jeffery Webber, iin an article published on the Counterpunch site.