CUSTOMS HOPES "SOCIAL CONTROL" WILL REDUCE

UNCLAS LA PAZ 001885

SIPDIS

SENSITIVE
SIPDIS

STATE FOR WHA/AND LPETRONI
COMMERCE FOR JANGLIN
ENERGY FOR CDAY AND SLADISLAW
TREASURY FOR SGOOCH

E.O. 12958: N/A
TAGS: ETRD EINV ECON ENRG EPET PGOV PREL BL
SUBJECT: CUSTOMS HOPES "SOCIAL CONTROL" WILL REDUCE
CONTRABAND

REF: 05 LA PAZ 3065


1. (SBU) Summary: Customs officials recently proposed a
"social control" mechanism to reduce contraband, arguing that
appropriate incentives would increase the identification and
seizure of illegally traded goods. The proposal is part of a
restructuring process in which officials are evaluating
existing operations, setting new goals, and tackling
corruption. The changes may be well intentioned, but it
appears unlikely they will significantly improve Customs'
enforcement capacity. End summary.


2. (SBU) In a July 7 meeting with EconOff, Customs President
Marcia Morales said she and other officials hoped a proposed
"social control" mechanism would increase the identification
and seizure of illegally traded goods. Morales said Customs
officials were working with counterparts in government
ministries, superintendencies, and law enforcement agencies
to create incentives for individuals and communities to
report possible contraband and to reward those whose
assistance leads to seizures. According to Morales, rewards
could include monetary payments to individuals or
GOB-sponsored investments and public works projects in
helpful communities.


3. (SBU) The proposal is part of a large-scale restructuring
process in which officials are evaluating existing
operations, setting new goals, and tackling corruption.
Morales said she hoped to reduce clearance delays but offered
few specifics, noting that evaluations were still underway.
She highlighted a new political will to make changes and
mentioned that one of her principal goals - driven by
frequent complaints of liquefied petroleum gas (LPG)
shortages, particularly in Bolivia's western highlands - is
to reduce widespread smuggling of LPG, diesel, and kerosene,
especially to Peru, where it reportedly sells for two to four
times the local price (reftel). Morales said she was working
closely with neighboring countries' customs services and
hoped to see marked improvements in bilateral cooperation;
she also said Chilean customs officials recognized Iquique as
a major port of entry for illegal imports and were eager to
pursue joint enforcement initiatives. Morales also
emphasized her commitment to tackling corruption, noting that
she had fired several Bolivian Customs officials suspected of
taking bribes.


4. (SBU) Comment: The changes may be well intentioned, but it
appears unlikely they will significantly improve Customs'
enforcement capacity. Leading Bolivian businessmen have
privately mocked the "social control" mechanism as weak and
ineffectual, and few expect the GOB's proposed incentives to
undercut Bolivians' tendency to turn a blind eye to the
importation, distribution, and sale of contraband. In the
absence of enhanced seizure capacity, greater legal clout,
and closer cooperation with law enforcement authorities,
Customs will likely make few dents in the illegal goods
trade. End comment.
GREENLEE