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France Demands “Fair and Prompt” Compensation for Bolivian Nationalizations

Wednesday, May 5th 2010 - 21:19 UTC
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Bolivian soldiers stand watch next to the nationalized companies Bolivian soldiers stand watch next to the nationalized companies

France's government demanded “fair and prompt” compensation from Bolivia for the nationalization of a power plant half-owned by French utility GDF Suez (EPA:GSZ).

Bolivian police and soldiers moved in to secure four power companies on Saturday, hours before President Evo Morales announced they were being nationalized, expanding the state's control over key industries. The companies include Empresa Corani S.A., a hydroelectric company operated by GDF Suez (EPA:GSZ), which itself is partly owned by the French Government.

“The nationalization should be accompanied by prompt and adequate compensation, calculated on the real value of the investment at the date of its expropriation,” French Foreign Ministry spokesman Romain Nadal said Tuesday.

GDF Suez said in e-mailed comments that it has “taken note” of the nationalization and “respects the legislation of the country where it is active, while defending its interests as a group under national and international law.” GDF Suez has owned a 50% stake in the 147-megawatt Corani hydroelectric plant since 2008, via its acquisition of US-based energy company Ecoenergy. GDF Suez is about 36% owned by the French Government.

The French Government also recalled that there is a Franco-Bolivian treaty dating back to October 1989 for the encouragement and protection of investments. Nevertheless, French companies “are willing to support Bolivia and its economic development” and to cooperate “with innovating projects in the filed of clean and renewable energies”.

Financial Tags: GSZ.

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