VZCZCXYZ0016
PP RUEHWEB

DE RUEHLP #3155/01 3262109
ZNR UUUUU ZZH
P 222109Z NOV 06
FM AMEMBASSY LA PAZ
TO RUEHC/SECSTATE WASHDC PRIORITY 1388
INFO RUEHAC/AMEMBASSY ASUNCION 6317
RUEHBO/AMEMBASSY BOGOTA 3641
RUEHBR/AMEMBASSY BRASILIA 7504
RUEHBU/AMEMBASSY BUENOS AIRES 4761
RUEHCV/AMEMBASSY CARACAS 2013
RUEHPE/AMEMBASSY LIMA 2075
RUEHME/AMEMBASSY MEXICO 1910
RUEHMN/AMEMBASSY MONTEVIDEO 4210
RUEHQT/AMEMBASSY QUITO 4652
RUEHSG/AMEMBASSY SANTIAGO 9235
RUEHRI/AMCONSUL RIO DE JANEIRO 0888
RUEHSO/AMCONSUL SAO PAULO 2051
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 003155 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
STATE FOR WHA/AND 
TREASURY FOR SGOOCH 
ENERGY FOR CDAY AND SLADISLAW 
 
E.O. 12958: N/A 
TAGS: EAGR ECON PGOV BL
SUBJECT: SENATE BOYCOTT OVER LAND REFORM 
 
REF: A. LA PAZ 3096 
 
     ¶B. LA PAZ 3131 
     ¶C. LA PAZ 3132 
 
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Summary 
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¶1. (SBU) Members of the political opposition are blocking 
discussion of a land reform bill (ref A) in the senate by not 
attending sessions.  Marches in favor of and against the 
reforms are intensifying throughout the country. Vice 
Minister of Agriculture Freddy Condo told Econoff on November 
22 that the GOB's two main goals regarding land reform are to 
speed up the land titling process to four months and to 
enable unproductive land to be reverted to the state through 
bi-annual reviews determining if medium and large properties 
are fulfilling an "economic and social function."  The GOB's 
proposed reforms would make securing credit difficult for 
large, agricultural producers in the East.  The divisive 
issue of land reform, combined with the president's proposed 
legislation to censure regional governors (ref B), and the 
debate over voting rules in the Constituent Assembly (ref C), 
have the potential to tip the conflict between the central 
government and the eastern regions to a breaking point.  End 
summary. 
 
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Opposition Blocks Land Reform in Senate 
--------------------------------------- 
 
¶2. (SBU) Members of the political opposition parties Podemos 
and UN are blocking discussion of a draft law modifying the 
1996 National Agrarian Reform Law (INRA) in the senate by not 
attending senate sessions.  Without a quorum, discussion of 
the law cannot go forward.  The law was approved by the lower 
house, in which the GOB's MAS party has a majority, on 
November 15 (ref A).  Podemos holds 13 out of 27 senate 
seats, while the MAS holds 12, and opposition parties UN and 
MNR each hold one. 
 
--------------------------------------------- ---- 
Marches in Favor of and Against Reforms Intensify 
--------------------------------------------- ---- 
 
¶3. (SBU) Indigenous groups from Santa Cruz in favor of the 
reforms began marching towards La Paz about three weeks ago. 
Indigenous groups from four other regions subsequently 
initiated their own marches, and the five groups plan to meet 
in Calamarca, 80 kilometers from La Paz, on November 25 to 
march together to the capital.  On November 21, the Eastern 
Agricultural Chamber (CAO) led a counter-march in Santa Cruz 
department, joined by cattle ranchers, indigenous groups from 
the East, farmers, and a group of cooperative miners from 
Oruro. 
 
--------------------------------------------- - 
Vice Minister Explains GOB's Main Reform Goals 
--------------------------------------------- - 
 
¶4. (SBU) Vice Minister of Agriculture Freddy Condo told 
Econoff on November 22 that the GOB's two main goals 
regarding land reform were to speed up the land titling 
process to four months and to enable unproductive land to be 
reverted to the state.  He said that under the terms of the 
draft law, if government workers determined that a plot of 
land was not fulfilling an "economic and social function" 
during bi-annual inspections, the land would revert to the 
state.  He explained that although the current law provided 
for reversion, land was considered to be fulfilling an 
"economic and social function" as long as the owner paid a 
 
minimal amount of taxes on the land, and thus, in the past, 
unproductive land was rarely reverted.  He said that the 
inspectors would consider factors such as whether the land 
owner had equipment and workers, if the owner paid the 
workers social benefits, if the owner lived on the land, and 
if the owner had made investments in the property. 
 
¶5. (SBU) Condo further explained that only medium and large 
properties, but not small ones, could be "reverted" for not 
fulfilling a social and economic function and would not 
receive compensation.  However, small properties (those 
ranging from one to fifty hectares depending on region) could 
be "expropriated" for public need with compensation.  He said 
that medium and large properties could be used as collateral 
for loans, but that small properties could not.  He argued 
that reforms were necessary to avoid one head of cattle being 
allocated more land than a family.  He speculated that the 
senate would approve the reforms because the UN and MNR would 
join the MAS to form a majority in favor of the them. 
 
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Comment 
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¶6. (SBU) The GOB's proposed bi-annual review of whether or 
not property is fulfilling an economic and social function 
would make it difficult for large, agricultural producers to 
secure credit for long-term investments.  Condo's assertion 
that the UN and MNR would join with MAS to approve the land 
reform bill seems unlikely, given public statements by the UN 
senator in the press against the reforms.  The divisive issue 
of land reform, combined with the president's proposed 
legislation to censure regional governors (ref B), and the 
debate over voting rules in the Constituent Assembly (ref C), 
have the potential to tip the conflict between the central 
government and the eastern regions to a breaking point.  End 
comment. 
GOLDBERG