Boston Globe Editorial - Bolivia's big energy bet
Boston Globe Editoria - Bolivia's big energy bet
Copyright by The Boston Globe
THURSDAY, MAY 4, 2006
Cold War habits of mind, which seem to survive among some of President George W. Bush's advisers, are being tested by events in Latin America, where new strains of populism and nationalism are challenging the free-market doctrines of administration conservatives. With the United States' standing in the world in decline, the Bush team must not make relations with Latin America worse than they already are by falling back on Cold War patterns of behavior.
Although the announcement Monday by Bolivia's president, Evo Morales, that he is nationalizing foreign companies' natural gas operations has practically no direct effect on American interests, his action is certain to stir up resentment in a U.S. administration closely identified with Big Oil. But any temptation to weigh in from Washington with hostile opinions about a commercial quarrel between the elected president of the continent's poorest country and energy companies from Brazil and Spain should be avoided.
Morales made it plain he wants the principal foreign natural gas companies now operating in Bolivia not to leave but to accept his new stringent conditions for doing business there. He is betting that, at a time of soaring profits for energy corporations, Brazil's Petrobras and Spain's Repsol will accede to his demands rather than writing off their investments in Bolivia's energy sector - a total of $3.5 billion by all foreign companies - and leaving the country.
This is a localized quarrel, primarily between Bolivia and Brazil. It can have very little international impact even on natural gas prices. If Bush administration ideologues truly believe in the infallible workings of the market, they will ignore the fact that Morales took his gamble after a visit in Havana with Fidel Castro and Venezuela's populist president Hugo Chávez, and allow market forces to determine the outcome of the bold gamble Morales is taking.
- The Boston Globe
Copyright by The Boston Globe
THURSDAY, MAY 4, 2006
Cold War habits of mind, which seem to survive among some of President George W. Bush's advisers, are being tested by events in Latin America, where new strains of populism and nationalism are challenging the free-market doctrines of administration conservatives. With the United States' standing in the world in decline, the Bush team must not make relations with Latin America worse than they already are by falling back on Cold War patterns of behavior.
Although the announcement Monday by Bolivia's president, Evo Morales, that he is nationalizing foreign companies' natural gas operations has practically no direct effect on American interests, his action is certain to stir up resentment in a U.S. administration closely identified with Big Oil. But any temptation to weigh in from Washington with hostile opinions about a commercial quarrel between the elected president of the continent's poorest country and energy companies from Brazil and Spain should be avoided.
Morales made it plain he wants the principal foreign natural gas companies now operating in Bolivia not to leave but to accept his new stringent conditions for doing business there. He is betting that, at a time of soaring profits for energy corporations, Brazil's Petrobras and Spain's Repsol will accede to his demands rather than writing off their investments in Bolivia's energy sector - a total of $3.5 billion by all foreign companies - and leaving the country.
This is a localized quarrel, primarily between Bolivia and Brazil. It can have very little international impact even on natural gas prices. If Bush administration ideologues truly believe in the infallible workings of the market, they will ignore the fact that Morales took his gamble after a visit in Havana with Fidel Castro and Venezuela's populist president Hugo Chávez, and allow market forces to determine the outcome of the bold gamble Morales is taking.
- The Boston Globe
posted by Carlos T Mock at 9:04 AM
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