The Financial Express

The Bolivian coup: A case of lithium regime change

Supporters of former president Evo Morales carry "wiphala" flags that represent indigenous peoples. 	—Photo: AP Supporters of former president Evo Morales carry "wiphala" flags that represent indigenous peoples. —Photo: AP

Bolivia is in a state of crisis since President Evo Morales has been ousted in a military coup on November 10. In fact, he was forced by the military to resign and that forced resignation was a coup - by any  definition of a coup. He has now moved to Mexico where he has been granted political asylum. President Morales himself in an interview in Mexico said that the US was a "great conspirator of the coup against his government''.

The US foreign policy has been essentially guided by its desire to control natural resources by any means necessary including deployment of its own armed forces as is right now happening in Syria to capture and remain in control of Syrian oil fields. The military coup in Bolivia was carried out  following the typical CIA-designed blueprint  for a regime change through a coup rather than deploying its own armed forces intended to ensure US control of lithium, a critical global resource.

This blueprint for staging a coup has been in use for the last seventy years or so starting with the overthrow of the democratically elected government of Mohammad Mossadegh in Iran in 1953. In 2013,  the CIA officially admitted its involvement in the overthrow the Mossadegh government. Every military coup engineered by the CIA has been said to be to "restore'' democracy such as happened in Chile in 1973 where democratically elected President Salvador Allende was killed in a CIA-engineered military coup and then the  CIA-designed 'democracy' was foisted on the country under the leadership of a military junta headed by Augusto Pinochet. The Pinochet model of democracy is the type that is usually favoured by the CIA in a post- coup scenario.

These coups are usually preceded by accusations of some wrong-doing by the government, then followed by street protests and violence - quite often  mobilising very violent and destructive mobs  culminating in the overthrow of the government by a military coup. This very standard model has been applied to stage the military coup in Bolivia to overthrow Evo Morales. There was nothing new or innovative in the means that was applied for the regime change in Bolivia this time. There are numerous other examples like this one including the more recent ones in South America - removal of  Manuel Zelaya (Honduras), Fernando Lugo (Paraguay) and Dilma Rousseff (Brazil) from power. So far in recent times only in Venezuela the model has failed to overthrow the Maduro government.

Bolivia still remains the most impoverished country in South America. Since the days of the conquistadors [the knights, soldiers and explorers of the Spanish Empire and the Portuguese Empire], Bolivia has traditionally been ruled by white Europeans elite. The country also has a long history of coups.

MANY LIFTED OUT OF POVERTY: Evo Morales took office as president in 2006 and he was the first president of Bolivia who came from the indigenous minority population. During his 15 years of presidency, Bolivia achieved a steady 4.5 per cent growth rate, a spectacular growth performance. Real per capita income grew by more than 50 per cent over the last 13 years of his presidency, double the rate in the region. Poverty  fell from 60 per cent to  35 per cent in 2017. Unemployment in Bolivia almost halved from 7.7 per cent to 4.4 per cent. Minimum monthly wages tripled. Bolivia successfully lifted many out of poverty and illiteracy during President Morales's leadership.

 Even the World Bank recognised that. Siince Morales came to power the share of population living on less than US$1.90 a day has dropped by two-thirds to 6.0 per cent. It was made possible by redistributing profits from exports of nationalised gas to the poor.

Morales did not indulge in public expenditure binge to earn cheap popularity, his programmes were targeted to the poor to bring about qualitative changes in  their lives. The result was not only spectacular growth performance with strong redistributive justice but also very low inflation with no recession.

He transformed the face of the poorest Latin American country by lifting the living standards of millions of Bolivians. Indeed Bolivia should have been hailed as a development model. A report by the US think tank Centre for Economic and Policy Research (CEPR) clearly finds that policy changes, not merely a commodity boom, have been responsible for the surge in economic growth in Bolivia which has allowed the country to reduce poverty by 42 per cent and extreme poverty by 60 per cent since President Morales assumed his office in 2006.

LITHIUM - THE WHITE PETROLEUM: Now for decades the climate crisis has worsened and investors have been out to find new investment opportunities in green technology. Since the 1990s there has been a drive towards more electric cars which can help to improve air quality thus reversing the process of climate change. These electric cars need battery and battery needs lithium. This led to the speculation of a boom in the demand for lithium - the white petroleum. Bolivia is home to 70 per cent of world lithium reserve and Vice President Alvaro Garcia Linera (now deposed along with President Morales)  declared that lithium is "the fuel that will feed the world''. As Bolivia could not raise sufficient capital to develop its lithium, it entered into two contracts to develop lithium, amounting to US$3.0 billion, one with a Chinese company and the other with a German firm (ACISA).

But the contract with the German firm was cancelled just a week before President Morales was ousted in a coup. The contract with the Chinese company is based on sharing profits and remains in place. This made Morales government vulnerable and inadvertently placed Bolivia squarely into cold war between China and the US.

The coup against President Morales has to be understood in the context of increasingly intensifying cold war between the US and China. Now President Morales is gone but keen investors and lithium remain. A commentator made a cryptic comment that the US green foreign policy has now led to lithium regime change replacing petroleum regime change.

EXTREME RACIST RIGHT POLITICIANS  NOW CALLING THE SHOTS: Meanwhile, the military coup has created a façade of constitutional process of regime change through the self-proclaimed president Jeannine Anez, the far right second vice-president of the Bolivian Senate. She declared herself as the president in an almost empty Senate. After declaring herself the President,  she walked into the Presidential Palace carrying a Bible. She declared "The Bible returns to the Palace''  and  added,  "Our power is God''.

In Bolivia, Bible-thumping extreme racist right politicians are now calling the shots. The ultra-right fascist leader  Luis Fernando Camacho, popularly known as "Macho Camacho'' and his ultra-right forces played the decisive role in initiating the  process to overthrow of President Morales. Multi-millionaire Camacho, an ultra-right Christian fundamentalist, never won a democratic election. He has been closely associated with the racist fascist paramilitary force known for perpetrating racist violence in the country. The same mob that he led against President Morales was seen burning Wiphala, the flag that represents Andean indigenous people. The flag is the symbol of resistance by indigenous people of Bolivia against the centuries of exploitation, racial violence and economic and social injustice. Camacho leads the neo-fascist youth organisation called Union Juvenil Crucenista (UJC) who regularly perpetrates violence against indigenous people and uses the swastika symbol. The UJC works together with the fascist Falange Socialista Boliviana.

Immediately after the coup, Camacho stormed into the abandoned  Presidential Palace with a Bible in one hand and the national flag in the other, he bowed down his head in prayer and vowed to return God to the (presidential) Palace and declared "Pachamama will never return to the Palace'' referring to the Andean Mother Earth spirit and added "Bolivia belongs to Christ".

The cabinet formed by Anez does not include any member from the indigenous community. As the popular protest across the country  against the self- appointed Anez government grows, Camacho and his cohorts are chillingly calling the armed forces and police to "pacify'' Bolivian street protesters. That pacification campaign by state security forces has already led to eight deaths and hundreds injured.

Bolivia under President Morales attempted to build a system  to use its natural resources which would benefit its people. That led to nationalisation of resources to use the income thus generated to fund social and economic development of the country. His policy on lithium mining should be understood within that context. Bolivia's Lithium reserves are in Salar de Uyuni salt flats at a very  high altitude and that makes mining and processing more complex. But the Morales's resources policy and geographical and technical complexities deterred multinational mining firms to show any interest. Now with the political change in Bolivia, many argue that there will be more multinational mining firms forthcoming to extract lithium.  Indeed, some even welcomed the coup as an opportunity to reorganise the resources policy regime now in place in Bolivia so as to speed up the efforts to attract multinational mining firms to mine lithium. In the wake of the coup ACISA told German broadcaster DW that it was "confident that our lithium project will be resumed after a phase of political calmness and clarification''.


Muhammad Mahmood is an independent economic and political analyst.

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