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C O N F I D E N T I A L LA PAZ 000232 
 
SIPDIS 
 
E.O. 12958: DECL: 01/16/2024 
TAGS: ECON EAGR PGOV PHUM EINV CACS BL
SUBJECT: ALLEGED GOVERNMENT LAND GRAB AFFECTS U.S. RANCHER 
 
Classified By: Acting ECOPOL Chief Brian Quigley for reason 1.4 (b). 
 
¶1. (SBU) Summary: Recently, the Bolivian Government and 
landowners in the Cordillera province of Santa Cruz have 
clashed violently concerning land rights.  The government 
acuses the landowners, including a high-profile AmCit 
rancher, of labor abuses and serfdom against the resident 
Guarani population.  The ranchers assert there is no forced 
labor in the region and say the government wants to 
confiscate the land to exploit gas and oil reserves without 
having to pay the owners any compensation.  In other cases, 
supporters of the MAS government have squatted on municipal 
parklands, attempted to take over public land belonging to 
the national hydrocarbons distribution company, and invaded 
privately-owned property.  These cases may portend things to 
come as the government implements the new constitution, 
including a limit of 5,000 hectares of land for any 
individual owner.  End summary. 
 
¶2. (SBU) For over a year, the central government had been 
trying to gain access to a group of ranches in the Cordillera 
province of Santa Cruz Department in an attempt to prove that 
the landowners are employing indigenous Guarani through 
forced labor or slavery.  One of the landowners is an 
American citizen named Ronald Larsen, who has lived in 
Bolivia for over 40 years, gradually acquiring land and 
building a successful cattle ranch/popcorn farm/ecotourist 
destination. Larsen has transferred most of his Santa Cruz 
properties into the names of his three dual-national (U.S. 
and Bolivian) sons.  The Larsen case serves as a microcosm of 
the government-vs-landowner conflict, and has been used in 
the media as an example of the Morales government's 
anti-American policies.  However, the Larsen ranch is only 
one of 46 affected farms. 
 
¶3. (SBU) The main player on the government side is Vice 
Minister of Land Alejandro Almaraz.  In April 2008, Almaraz 
traveled to Cordillera province with members of the National 
Institute for Agrarian Reform (INRA) and forcibly tried to 
enter several properties to carry out a process known as 
"saneamiento," a review of land ownership, usage and 
complaince with all applicable laws.  Almaraz told the press 
that he was in the region to "free the slaves."  He and the 
other government representatives were prevented from entering 
the properties by the landowners and their employees.  The 
sometimes-violent stand-off lasted a week.  There were 
accusations and counter-accusations, including a statement by 
the Minister of Government that "Larsen is an instigator of 
the violence, intending to turn Bolivia into the Wild West." 
Prominent Santa Cruz figures also weighed in.  Cardinal Julio 
Terrazas declared there was no slavery in the region, drawing 
the wrath of President Morales.  Two independent commissions 
of Santa Cruz leaders traveled to the region and also 
declared that there was no slavery.  The government did not 
give in on that point, but to end the confrontations, it 
ordered Almaraz to return to La Paz and declared a "pause" in 
the saneamiento process. 
 
¶4. (C) The night of November 21, at 3:00 in the morning, INRA 
officers returned to the area with police and forcibly 
entered the ranches. Landowners report that a great deal of 
force was used, including shooting off locks, breaking doors 
and fences, and generally destroying anything in the way. 
Almaraz showed up the next morning.  Ronald Larsen was not at 
the ranch at the time, and shortly after the incident he 
returned to the U.S. in order to avoid the appearance of 
resistance that could have provoked additional charges 
against him or his family members.  The Larsens' lawyer told 
us that, worse than the property damage to the residence, was 
the damage to the ranch's infrastructure.  For example, the 
police destroyed fences enclosing cattle, and the animals 
wandered off into the hills and forests.  INRA then told the 
foreman he had to produce all the cattle that he had on the 
books within five days, knowing it would take weeks or months 
to round up all the animals that escaped into the wilderness. 
 According to Guido Nayar, President of the Bolivian 
Ranchers' Association, the government told several landowners 
that they would be left in peace if they agreed to give 
declarations "against the gringo."  The Larsens' lawyer, who 
also represents many of the other landowners in the dispute, 
said that many of them had agreed to surrender some land to 
the government under threats that they would lose it all. 
After the political negotiations took place, all under police 
occupation of the ranches, INRA settled down to the process 
of collecting the legal documents required in the saneamiento 
process.  The lawyer said there were many irregularities. 
For example, the saneamiento was directed by a public 
prosecutor from La Paz, rather than one from Santa Cruz as 
required by law. 
 
¶5. (C) Nayar said the farms were occupied from November 21 
through December 19.  At each farm, INRA compiled folders of 
production records and land titles, but also collected 
declarations from local Guarani claiming to have been 
mistreated on the various farms.  The lawyer told us most of 
these declarations were completely false, given by people who 
are no longer employed at the ranches, or given under duress. 
 Nayar claims that several Guarani received money or other 
government benefits in return for their statements.  We have 
heard from numerous people, including some current government 
officials, that the Larsens are exemplary employers.  They 
pay laborers well above the admittedly-meager minimum wage, 
comply with labor laws such as providing contracts, built a 
church and elementary school on the property, and provide 
subsidized food.  Ronald Larsen is said to be well-liked by 
the people in the region, and the employees are fiercely 
loyal to him.  On December 19, INRA officials sent the 
folders they had compiled back to La Paz, another 
irregularity as the decision-making would normally be done at 
the Santa Cruz INRA office. 
 
¶6. (SBU)  The week of February 2, the government announced 
that of the 88,000 hectares that INRA investigated in 
November and December 2008, they had decided to confiscate 
36,000 hectares.  The decision affects many landowners, some 
of whom will lose only part of their property.  The Larsens, 
however, would lose everything.  The lawyer points out that, 
although they are not being singled out as Americans per se, 
because many other landowners are affected, he believes the 
Larsens are being treated extra-harshly and being stigmatized 
by INRA as U.S. citizens.  The landowners are appealing the 
decision at the National Agricultural Tribunal (a branch of 
the Supreme Court in Sucre).  Nayar's organization called for 
"civil disobedience" to resist the unjust decision, but 
several of the affected landowners (not the Larsens) have 
vowed to resist with force and say they won't leave their 
farms alive. 
 
But Why? 
-------- 
 
¶7. (C) The big question is why the government is going 
through all this trouble in the out-of-the-way Cordillera 
province.  The land is not particularly fertile in the 
Bolivian Chaco, and it requires much more acreage to support 
a head of cattle than in other areas of the country.  Larsen 
told us in April 2008 that Almaraz had received a grant from 
a European human rights NGO to "eliminate slavery in the 
Chaco," and thus he needed to produce some slaves or else he 
would have to return that money.  We were not able to verify 
that story, and we have never heard it repeated by anyone 
else.  The prevailing theory is that the ground under those 
ranches is rich in hydrocarbon resources, which the 
government wants to exploit without having to pay any 
compensation for surface rights for the necessary roads and 
wells.  According to this theory, the government intends to 
confiscate the land from the ranchers and give it to pro-MAS 
indigenous as communal property.  Private landowners cannot 
profit from sub-soil resources that by law belong only to the 
state.  However, under the new constitution, communal 
property holders are entitled to receive access fees for 
exploitation of minerals or hydrocarbons.  Nayar mentioned 
that INRA was offering the local employees land from the 
ranches in return for their "cooperation," however the land 
would be "communal property."  None of the ranch employees 
are interested in communal property that they cannot profit 
from individually.  Nayar theorized that the government could 
even go so far as to "import" cooperative Aymara or Quechua 
groups to carry out the plan. 
 
¶8. (C) Comment: The facts in Cordillera are elusive, and it 
remains to be seen what will become of the 46 ranches.  We 
expect a lengthy appeal process.  The Embassy has not engaged 
with the government on this issue because, despite the 
special press coverage (some of which he himself sought), 
Larsen has not requested specific assistance.  Despite the 
lawyer's opinion, it is not clear he is being singled out by 
the government for treatment worse than that received by many 
of his Bolivian neighbors.  Furthermore, he has registered 
the land in the names of his three dual-national sons in an 
effort to protect it. 
 
"Without a Roof" Movement 
------------------------- 
 
¶9. (C) Land disputes are not limited to rural, agricultural 
areas of Santa Cruz.  Within the capital city, a group that 
calls itself "Movimiento Sin Techo" ("Without a Roof 
Movement") has taken over eight municipally-zoned parklands 
and demanded property rights.  Mayor Percy Fernandez and his 
chief legal advisor told American Presence Post Officer 
(APPO) that the law is firmly on the side of the municipal 
government, since protected areas within the city are 
inviolable.  The movement has existed since 1990, but gained 
momentum in 2000 in both urban and rural areas with the 
support of the MAS.  The leader of the movement in Santa Cruz 
is Valerio Queso, the Evo Morales look-alike who played the 
president in a biographical film.  Although the squatters 
claim to be homeless families, most of the land they are 
occupying is in the city's center and, if it were not 
protected property, it would be valuable real estate.  In 
addition, numerous neighborhoods in and around Santa Cruz are 
growing daily, absorbing immigrants from other Departments, 
and therefore the argument that there is no land for these 
families rings hollow.  It is clear that economic interests, 
and not humanitarian ones, are behind the incidents.  The 
municipality is seeking court action against the movement to 
remove the squatters from public land.  If the court orders 
the squatters to move, the municipality will ask the Bolivian 
National Police to enforce the decision.  The police have a 
good track record in this respect.  In fact, one policeman 
died in Oruro in 2008, and police have been injured in 
Tarija, enforcing court-ordered squatter evacuations. 
 
Targets of Opportunity 
---------------------- 
 
¶10. (C)  Immediately after the January 25 constitutional 
referendum, several well-organized and armed groups attempted 
land-grabs in Santa Cruz.  Generally, each family that 
participates must pay the organizer(s) 200 to 300 dollars 
(several months salary) in advance, as a payment for any 
potential land won through the squatting action.  This is why 
the participants can be very aggressive, because it is not a 
spontaneous action, but one in which they have a big 
investment.  One group attempted to take over land controlled 
by YPFB, the national hydrocarbons distribution company.  The 
leaders claimed that the new constitution promised them land, 
and they were demanding that the state pass out state lands 
immediately.  However, the central government distanced 
itself from this group, and it quickly dispersed.  In another 
case, residents of the San Juan municipality, who are largely 
pro-MAS internal immigrants, seized three private properties 
in nearby Guarayos province.  Interestingly, the groups 
didn't target the obvious Santa Cruz "Oligarchs," i.e. the 
famous ten families that own huge tracts of land in the 
department.  Rather, the landowners were targets of 
opportunity based on geographical proximity: a Brazilian, a 
Mennonite, and a run-of-the-mill Bolivian farmer.  As the 
General Director of the Agicultural Chamber of the East (CAO) 
Edilberto Osinaga explained, "Carnivores target the weakest 
of the herd."  Again in this case, the land-invaders were 
well-organized, aggressive, and armed with farm implements 
and machetes.  A local court has already ruled in favor of at 
least one landowner, who is going through the process of 
requesting the police remove the trespassers.  However, the 
three farmers have reportedly gotten threatening calls from 
alleged MAS leaders, implying that if they want to keep part 
of their land, they should give up 50%, or else they risk 
losing it all.  In the meantime, their farms continue to be 
occupied by the squatters in a form of continuous pressure. 
 
¶11. (C) Osinaga told APPO that when these incidents first 
occurred, Santa Cruz farmers were worried the land-grabs 
would be epidemic.  However, there have not been additional 
cases.  Now the theory is that the cases were MAS trial 
balloons.  Perhaps, he speculated, the central government 
expected to garner support among the general Santa Cruz 
population using the land promise.  And perhaps, he added, if 
the land grabs had targetted the traditional "oligarchical" 
families, they would have had more popular resonance.  But 
these cases served only to alarm the majority of people about 
the government's intentions.  The truth is, the large farms 
owned by foreigners and well-established Bolivians are the 
ones that generally obey the land-usage and labor laws. 
Small and medium farmers are most susceptible to losing their 
land due to legal violations, and if that happens there will 
be a strong anti-government backlash in Santa Cruz and 
throughout the rest of the country. 
 
Communal Land -- A Big Mistake 
------------------------------ 
 
¶12. (C) Universally, farmers in Santa Cruz agree that the 
biggest miscalculation of the government's land reform plan 
is the idea of indigenous communal property.  Banks in 
Bolivia do not finance agriculture; agroindustry does.  And 
agroindustry is very unlikely to finance communal land, as no 
one is ultimately responsible.  Therefore, agriculture for 
export under communally-owned property is almost impossible. 
Farmers worry that the agriculture-based economy that 
Crucenos are so proud of could be destoyed by the land-reform 
policies of the Morales administration, and this hits the 
Cruceno psyche much deeper than any one example of property 
loss. 
 
Prefect: Legal Defense and Peaceful Resistance 
--------------------------------------------- -- 
 
¶13. (C) So far, it seems that Santa Cruz farmers are 
committed to exhausting every legal means possible to defend 
their lands, and in many cases the courts and police are 
doing their jobs.  Prefect Ruben Costas, a farmer himself, is 
personally organizing a Department-wide Committee in Defense 
of Property.  He is urging all farmers to get their paperwork 
in order and make sure that they are in compliance with all 
laws.  Producers are hopeful Costas will be able to persuade 
the MAS to back down from the land grabs. The Crucenos have 
learned that they get more sympathy nationally and 
internationally when they are the victims, not the 
aggressors.  However, as the MAS constitution is implemented, 
especially the section prohibiting property ownership in 
excess of 5,000 hectares, things could get dicey.  (Note: The 
constitution grandfathers farms in excess of 5,000 hectares 
already in existence prior to February 1, 2009; only new 
farms are prohibited from exceeding 5,000 hectares.  However, 
there are other legal means for taking land, such as 
confiscating land that does not serve a "social purpose," 
which greatly worry Cruceno farmers.)  When it comes to 
taking people's land and livelihood away, there is a strong 
potential for violence. 
URS