MercoPress. South Atlantic News Agency

Bolivia: Mesa and Morales at their necks

Hopes for an understanding between Bolivian president Carlos Mesa with union and opposition leaders faded late Thursday evening when talks to reach a consensus on the hydrocarbons bill currently under consideration in Congress, broke down.

Evo Morales leader of the opposition, head of the Movement Towards Socialism MAS and of the coca planting Indians, announced after the meeting that beginning Friday protests and route blockades will be intensified.

"It's a lost case; I deplore the Executive's intransigence in defending servile policies that only favour the open market model and voracious multinational corporations who don't care about people", said Mr. Morales.

The meeting promoted by president Mesa included Jaime Solares chairman of Bolivia's trade unions, agrarian leaders and representatives from other sectors who actively participated in the blockading of the country's routes and strangling of the economy.

The controversy is over oil royalties which Mr. Morales and his followers want to increase from 18 to 50%, to be paid by foreign corporations, but president Mesa fears they will definitively scare foreign investors from impoverished Bolivia in spite of its rich mineral resources sector, still mostly unexploited.

Earlier in the day thousands of Bolivians took to the streets in the country's main cities in support of president Mesa and his anti road-blocking crusade.

President Mesa who last weekend was cornered by increasing protests and road-blocks masterminded by Mr. Morales, unexpectedly sent his resignation to Congress. Two days later he was unanimously confirmed by Congress and bolstered with an agreement that ensures him Congressional support to address the controversial hydrocarbons bill, constitutional reform and a referendum on regional autonomy.

Feeling stronger Mr. Mesa decided to take on Mr. Morales who with all his deputies and political allies were absent from Congress describing the president's resignation as "political blackmail".

In his Wednesday speech to Congress Mr. Mesa invited Mr. Morales to join the "historic turning point", and later called for direct talks on the hydrocarbons bill.

Mr. Morales first reacted by re grouping all the opposition into a united front plus signing a deal backing further demonstrations, and later accepted participation in the dialogue table.

However he flatly refused the government's option of leaving oil royalties at 18% and creating an additional 32% flexible Complementary Hydrocarbons Tax which contemplates rebates and compensations. He insisted in a flat 50% royalty.

"The president has lied to the Bolivian people. The problem is not the blockades. It's the energy bill that Mesa wants to force on us in favour of multinationals and that is why he blackmailed us with his resignation", argued Mr. Morales.

Seventeen months ago when Mr. Mesa took office his elected predecessor had to flee the country when he called in the Army to end the stalemate over the energy controversy, which ended with a death toll of 60 and 500 wounded.

Mr. Mesa and Mr. Morales are publicly committed to avoid a similar situation, but for how long can the situation remain under control?