With the backing of the military and the opposition divided and conquered, Evo Morales will likely stay on as Bolivia’s president. Such political stability will present Bolivia with an opportunity to grow its economy and prepare for a safe political transition.
Bolivian president Evo Morales and his Movement to Socialism (MAS) party will likely retain power in the general election in October 2014. Here are the top three reasons why the resource-rich, landlocked country is more stable than it seems.
1. The economy is improving
Compared to the political-fiscal collision course that the late Hugo Chávez established for Venezuela, Morales’s policies have managed to strike a balance that has avoided a similar fate.
In 2009, while most of the South American countries suffered during the global financial crisis, Bolivia had the highest GDP growth rate on the continent at 3.4 percent. Standard & Poor’s even upgraded Bolivia’s credit rating to BB- in response to strong GDP growth and safe fiscal policies. In 2012, the poverty rate has fallen by 24 percent since Morales began his presidency. The IMF expects the Bolivian economy to grow by 5 percent in the next two years. Bolivia is also rapidly expanding trade with Brazil and China.
Furthermore, it has newly discovered vast lithium reserves in the Uyuni salt flats region near Potosí. With the ever-growing demand for lithium in cell phones and electric vehicles, the minerals could be a huge new source of revenue.
Bolivia still faces immense economic challenges though. Harvesting the lithium would require infrastructure development and water resources that could further harm Morales’ relationship with the local indigenous communities.
The government’s track record of seizing foreign-owned company offices by force does not help his case. Red Electrica, a Spanish-owned power company in Cochabamba, was one of the latest to fall victim. However, Joao de Castro Neves, an analyst with the Eurasia Group said Evo Morales is still seen as one of the less radical leftist leaders: “He knows his limits. The Bolivian state doesn’t have the capacity to take over all these sectors (including mining) and maintain the high levels of investment they need.”
2. Morales has shored up support with the military
Bolivia’s military today is far more socially integrated than it was during the years of Hugo Banzer, the country’s last military ruler. After Morales took office, the military academy began to include indigenous people and female recruits. The government regularly replaces high level officers in the military that it does not politically favor.
Morales has not been shy about buying new military hardware. The Bolivian Air Force is boosting its transport capacity with two new EC-145 helicopters in May and six Airbus AS 33C1e Super Puma aircrafts in June. Russian arms sales to the Bolivian military are also increasing.
The launching of Bolivia’s first satellite, called Tupak Katari, and the aim to obtain nuclear technology will only increase his support from the military. The recent sacking of 700 protesting troops shows that there is still widespread discrimination within the armed forces. More importantly, it illustrates that Morales will back the military elite over his fellow Aymara kin.
3. MAS has diversified its power base
MAS is quietly transforming its support structure from its origins. Shifting from its primary power base in the agriculture sector to labor, service, and mining, the party has broadened its cross-sector appeal. The government just raised the minimum wage to shore up support with the labor unions.
Furthermore, the push for greater autonomy in four departments in the country’s Camba low lands, Beni, Pando, Santa Cruz, and Tarija once threatened Bolivia’s territorial integrity. Protests and unrest were a regular occurrence. However, after the removal of the governors of Beni and Tarija, the movement has largely appeared to fizzle out.
The main problem lies in the conflict between the MAS party and the Nation Council of Ayllus and Markas of Qullasuyu (CONAMAQ). The indigenous organization had been a member of MAS’ Pact of Unity, which is a group of allied grassroots organizations backing land reform and indigenous civil rights. Due to MAS’ undertaking of large highway infrastructure projects and environmentally damaging mining operations, CONAMAQ has left the coalition.
To retain power, Morales has held together a vast coalition with varying agendas. Now, infrastructure development, financed by Brazil, is seen as the best way to scale back poverty. Highways will soon cut through the TIPNIS protected region. This will no doubt appeal to Bolivia’s growing middle class voters.
Morales, with subtle pragmatism and the power of the state, will continue to lead Bolivia’s dramatic transformation for quite some time.
