May 21, 2004

The Questions are out

MABB is a registered TM.

President Mesa, in a speech given on Wednesday night, May 20th, made public the questions he is planning to ask Bolivians in the July 18th referendum. The questions are listed below. Following the questions in Spanish are the translated questions (by me) in English.

Las preguntas que el Presidente propone para el 18 de julio.

1. Esta usted de acuerdo con la abrogacion de la Ley de Hidrocarburos 1689 promulgada por Gonzalo Sanchez de Lozada? Si o No.

2. Esta usted de acuerdo con la recuperacion de la propiedad de todos los hidrocarburos en boca de pozo para el Estado boliviano?

3. Esta usted de acuerdo con refundar Yacimientos Petroli­feros Fiscales Bolivianos, recuperando la propiedad estatal de las acciones de las bolivianas y los bolivianos en las empresas petroleras capitalizadas, de manera que pueda participar en toda la cadena productiva de los hidrocarburos?

4. Esta usted de acuerdo con la poli­tica del presidente Carlos Mesa de utilizar el gas como recurso estrategico para el logro de una salida util y soberana al oceano Paci­fico?

5. Esta usted de acuerdo con que Bolivia exporte gas en el marco de una poli­tica nacional que cubra el consumo de gas de las bolivianas y los bolivianos, fomente la industrializacion del gas en territorio nacional, cobre impuestos y/o regali­as a las empresas petroleras llegando al 50 por ciento del valor de la produccion del gas y el petroleo en favor del pai­s; destine los recursos de la exportacion e industrializacion del gas, principalmente para educacion, salud, caminos y empleos?

Here is the translation.

The questions president Mesa proposes for the July 18th referendum.

1. Do you agree with the abrogation of the Hydrocarbons Law 1689 signed by Gonzalo Sanchez de Lozada?

2. Dou you agree with the recovery of all Hydrocarbons from the well head (mouth of the well) in favor of the Bolivian State?

3. Do you agree with the re-creation of Yacimientos Petroliferos Fiscales Bolivianos (state oil company), recovering the interests (stocks) of all bolivians in the capitalized petroleum companies in a way that it participates in the production of hydrocarbons?

4. Do you agree with president Carlos Mesa's policy of utilizing gas as a strategic tool to gain useful and sovereign access to the sea?

5. Do you agree with an export policy that covers local consumption; promotes industrialization of gas in Bolivia; charges taxes and/or rights fees to the petroleum companies arriving at a 50 per cent of the production value of gas and oil; and uses these resources for education, health, roads and jobs?

These questions, as expected, have triggered reactions from a variety of political actors nationally. One reaction, which I did not expect, was the support of Evo for the questions and the referendum. Perhaps it is because this referendum is what he was looking for. He even said that his party (MAS, Movement Towards Socialism) helped create the second question. More support, again as expected, came from coalition partners MIR (Movement for the Revolutionary Left), MNR (Nationalist Revolutionary Movement) and many parlamentarians who backed this idea. On the other hand, there was disent and repudiation coming from the social sectors and civic organizations (grass roots organizations, NGOs and a vast network of unions), who are seeking the total nationalization of the Energy sector. Another sector against this idea, which particularly has a problem with the questions, is the private sector. The association of private enterprisers said these questions are confusing and do not address the real problems Bolivia faces. Additionally, there are a number of civic organizations in Santa Cruz (the second largest city), which are against the referendum. They argue that such a mechanism is not legally backed and is unconstitutional. Finally, the NFR (New Revolutionary Force) has officially characterized the referendum as unconstitutional and will be challanging it in the courts. They also argued that the questions are too dificult to understand.

As one might expect, the formulation of such questions is, to say the least, difficult. However, having said that, the referendum will happen and thus the questions have to be correctly and clearly formulated. Especially in a country like Bolivia, where illiteracy reaches about 14 per cent of the population. In rural areas this number is higher due to the poor education, insuficient infrastructure, isolation from the urban centers and to the fact that the majority of people who live in rural areas speak Spanish as a second language. Not to mention the fact that illiteracy in women is much, much higher.

So, are these questions clearly formulated? In my opinion, some are not as clear as they could be and others are somewhat complicated. They are designed to bring a satisfactory outcome for the government.

Question number one asks whether the country should throw away the Hydrocarbons law 1689 signed into law during the previous administration. If the old law were to be thrown out and since it is well known that Mr. Mesa wants to introduce a new energy law, this would prove to be all too convenient for Mr. Mesa. Therefore, it seems that to achieve this result, the question includes the name of the former president Sanchez de Lozada. Now, we all know that the government is keenly aware, at this point in time, the name Sanchez de Lozada is generally despised by the population. The asociation of anything with the name Sanchez de Lozada will cause inmediate rejection. So, I ask, why did Mr. Mesa include the name of former president Sanchez de Lozada, when he could have simply asked whether the law should be abrogated or not?

In the second question, the government asks whether Bolivians are in favor of recovering the ownership to natural gas from the energy companies. This is a question that had to be carefully formulated. Every word had to be carefully thought out. The implications of making a mistake are too big. The main demand of the social sectors is the nationalization of the energy resources (natural gas, oil, etc.), but the question here is asking whether the government should recover the rights of ownership of the hydrocarbons by means of renegotiating the terms of the contracts with the energy companies. This entails understanding that The word propiedad (property) refers to the gas once it is out of the well. According to the contracts, once there is gas flowing out of the well, this gas becomes property of the company extracting it. The hydrocarbon underneath the earth is still property of the Bolivian state. The question does not ask whether Bolivian gas should be nationalized or not. The government has no intention of taking away all the rights of the companies or entirely taking over the production of oil and gas. In the eyes of the world this would mean commercial suicide for Bolivia. The key aspect here is whether the average Bolivian will know what this question really refers to, maily that the energy companies are there to stay.

Questions number three and four are pretty clear, in my opinion. However, if there is one clearly formulated question, number four is it. It is clearly asking if the government is right in using Bolivian gas as a political tool to help Bolivia gain access to the seas. This point will directly affect diplomatic relations between Bolivia and Chile. This question will have many foreign policy implications for Bolivia, but we'll leave this issue for another time. I think it is pretty clear what the answer will be, considering that Bolivians have never lost hope in recovering their shores.

The fifth question asks whether Bolivians will support Mr. Mesa's new hydrocarbons law. There is a lot riding on this question. It implicitly asks if the people have faith in Mr. Mesa or not. If the question is "yes", then the Mesa administration can move forward with its policies and projects. However, if the anwer is "no", Mr. Mesa will be left in a difficult position. He may suffer a similar fate as his predecessor. Nevertheless, it is a long question and as such will require for people to actually read and think about it, if the government does a good job in informing and educating the people about the questions and what they mean for Bolivia, it should not be difficult to understand it.

Lastly, the success or failure of the referendum lies entirely on how well the government conducts its information campaign about the referendum. People need to discuss the issues and for them to do this, they would have to have a pretty good understanding of what it's at stake. Of course, Bolivians are not ignorant about the issues, they know in rough terms what is it they need to do and think about. And, if they do not know, the social sectors opposed to the referendum will make sure they hear their side of the issue. Therefore, if the government does not carry out an efficient info campaign reaching out to the furthest corners of the territory, the referendum has little chance to be in favor of the government.