VZCZCXYZ0012
PP RUEHWEB

DE RUEHLP #2600/01 2692020
ZNR UUUUU ZZH
P 262020Z SEP 06
FM AMEMBASSY LA PAZ
TO RUEHC/SECSTATE WASHDC PRIORITY 0689
INFO RUEHAC/AMEMBASSY ASUNCION 6123
RUEHBO/AMEMBASSY BOGOTA 3440
RUEHBR/AMEMBASSY BRASILIA 7298
RUEHBU/AMEMBASSY BUENOS AIRES 4560
RUEHCV/AMEMBASSY CARACAS 1817
RUEHPE/AMEMBASSY LIMA 1857
RUEHMD/AMEMBASSY MADRID 3132
RUEHME/AMEMBASSY MEXICO 1786
RUEHMN/AMEMBASSY MONTEVIDEO 4032
RUEHQT/AMEMBASSY QUITO 4453
RUEHSG/AMEMBASSY SANTIAGO 9026
RUEHKO/AMEMBASSY TOKYO 0249
RHEHNSC/NSC WASHINGTON DC
RHEBAAA/DEPT OF ENERGY WASHINGTON DC
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RUEATRS/DEPT OF TREASURY WASHINGTON DC

UNCLAS LA PAZ 002600 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
STATE FOR WHA/AND 
TREASURY FOR SGOOCH 
ENERGY FOR CDAY AND SLADISLAW 
 
E.O. 12958: N/A 
TAGS: EAGR ECON BL
SUBJECT: LAND REFORM SOWS CONFLICT 
 
REF: A. LA PAZ 2557 
     ¶B. LA PAZ 2562 
     ¶C. LA PAZ 1651 
 
¶1. (SBU) Summary: The MAS administration has presented a bill 
to Congress to modify the 1996 Agrarian Reform (INRA) law, in 
line with its pre-election promises to redistribute land to 
the landless.  Members of the administration have encouraged 
social sectors to mobilize marches and blockades to force 
Congress to approve the bill in October.  Large agricultural 
producers in the eastern regions are worried that the bill 
could create legal uncertainty over land title, which could 
lead to disinvestment, diminished production, and violent 
conflicts.  End summary. 
 
Congress Considers Land Reform Bill 
----------------------------------- 
¶2. (SBU) The MAS administration has presented a bill to 
Congress to modify the 1996 National Institute of Agrarian 
Reform (INRA) law, in line with its pre-election promises to 
redistribute land to the landless.  A congresswoman from an 
opposition party told Econoff on September 21 that the 
opposition was trying to block the bill, as it lacked social 
consensus. 
 
The GOB's Double Discourse 
-------------------------- 
¶3. (SBU) On September 20, Vice President Garcia Linera asked 
social sectors in Santa Cruz to mobilize through marches and 
blockades to pressure Congress to modify the INRA (land 
reform) law by early October (ref A).  Soon after, he told 
the same groups to call off the blockades (ref B).  On 
September 25, the Vice Minister of Lands, Alejandro Almaraz, 
reportedly encouraged indigenous leaders in Sucre to mobilize 
to force Congress to approve the INRA modification bill. 
Social sector leaders from the East expressed confusion over 
the conflicting GOB directives and demanded clarity. 
 
Santa Cruz Producers Concerned 
------------------------------ 
¶4. (SBU) The President of the Oil Seed Producer's Association 
(ANAPO) in Santa Cruz, Carlos Rojas, told Econoff on 
September 22 that soy producers were concerned about the INRA 
modification bill, which would enable the government to 
review whether or not a parcel of land was fulfilling a 
social and economic function at any time.  Producers feared 
that the GOB would use the new law as a pretext to take over 
fallow land that was not planted to enable regeneration of 
soil quality.  Without legal certainty over title, the 
producers were unwilling to make large investments in their 
land, Rojas explained.  Producers were also worried that the 
new law would only allow for community title, rather than 
individual.  According to Rojas, the draft law would also 
diminish land holders' rights to legally defend their 
property ownership, and would require owners of large estates 
to obtain a permit prior to sale.  Rojas also complained that 
the GOB's centralization of processes for the reversion, 
expropriation, and titling of land was taking away the 
ability of municipal governments to determine appropriate 
policies in their areas. 
 
¶5. (SBU) Mauricio Roca, President of the Eastern Agriculture 
Chamber (CAO), told the Charge on September 22 that the GOB 
was mistaken in its belief that land redistribution would 
solve poverty, as land alone did not equal wealth.  Land 
would have to come together with productive capacity, 
equipment, and markets to generate income, he said.  Roca 
complained that the decrees issued in June to redistribute 
land (ref C) and the INRA reform bill gave the GOB too much 
discretion to redistribute land with little protection for 
land owners.  He also questioned why the GOB sought to push 
the INRA modifications through Congress in October, when the 
Constituent Assembly would consider the land reform issue and 
possibly invalidate any prior decisions made by Congress.  He 
added that land owners in the Beni and Santa Cruz were 
prepared to "go to any lengths" to protect their land. 
 
¶6. (SBU) Comment:  The GOB has already redistributed some 
state-held lands, including lands over which private 
companies held forestry concessions (ref C).  Additional land 
redistribution, particularly of privately-held lands, and 
legal reforms are likely to engender explosive conflicts 
during the next several months.  We will continue to follow 
this issue closely.  End comment. 
URS