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Center for Economic and Policy Research (CEPR): New Paper Suggests Bolivian Conflict Revolves Around Lopsided Control Over Land, Natural Gas

FOR IMMEDIATE RELEASE
July 30, 2008
10:03 AM

CONTACT: Center for Economic and Policy Research (CEPR)
Dan Beeton, 202-239-1460

 
New Paper Suggests Bolivian Conflict Revolves Around
Lopsided Control Over Land, Natural Gas
 
WASHINGTON - July 30 - A new paper from the Center for Economic and Policy Research shows that the “Media Luna” states that have recently held referenda on autonomy also have the highest concentrations of land ownership, and receive disproportionate shares of Bolivia’s natural gas revenues. Hydrocarbon production, which is mostly natural gas, accounts for 6.5 percent of Bolivia's GDP and 47 percent of its export revenue.

These states also have a much smaller indigenous population than the rest of the country.

"The fight over autonomy in Bolivia revolves around the distribution of gas revenues and land," said Mark Weisbrot, Co-Director of the Center for Economic and Policy Research and co-author of the report. "It is not clear that the government can deliver on its promises to the voters without making this distribution more equal, which the leaders of the autonomy movement oppose."

The paper, “The Distribution of Bolivia's Most Important Natural Resources and the Autonomy Conflicts,”  by Mark Weisbrot and Luis Sandoval, shows that the concentration of land in Bolivia - among a very small group of landowners - appears to be among the very worst in the entire world. The largest farms, although only 0.63 percent of the total, encompass two-thirds of all agricultural land. At the other end of the spectrum, 86 percent of farms account for just 2.4 percent of agricultural land, and many other rural families own no land at all.

The paper also notes that even though Bolivia distributes its hydrocarbon revenues more than any in the world to provincial and local governments, the Media Luna states are advocating for even more of these revenues to go to the provincial governments.

The Media Luna states also have a disproportionate share of Bolivia’s natural gas resources. Tarija province produces 60 percent of the country's natural gas, and Santa Cruz holds 22.3 percent, meaning that more than 82 percent of natural gas production is concentrated in just these two Media Luna states. The Media Luna states as a group receive the lion's share of the hydrocarbon revenue:  30 percent, as compared to 19.7 percent for the other five states. These states also have a much higher per capita income - 1.4 times more -- than the other provinces.

The paper notes that there is a significant demographic divide between the Eastern lowland states and the rest of Bolivia. The Media Luna provinces have a much lower indigenous population than the rest of the country, ranging from 16.2 percent in Pando to 37.5 percent in Santa Cruz; this compares with an average of 62 percent for the rest of the country. This is clearly a vast demographic gap in a country where the indigenous majority has suffered centuries of discrimination. Indigenous Bolivians today have much higher rates of poverty, extreme poverty, illiteracy, and malnutrition.


The Center for Economic and Policy Research is an independent, nonpartisan think tank that was established to promote democratic debate on the most important economic and social issues that affect people's lives. CEPR's Advisory Board of Economists includes Nobel Laureate economists Robert Solow and Joseph Stiglitz; Richard Freeman, Professor of Economics at Harvard University; and Eileen Appelbaum, Professor and Director of the Center for Women and Work at Rutgers University.

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