LOWER HOUSE PASSES LAND REFORM BILL

UNCLAS LA PAZ 003096

SIPDIS

SENSITIVE
SIPDIS

STATE FOR WHA/AND
TREASURY FOR SGOOCH
ENERGY FOR CDAY AND SLADISLAW

E.O. 12958: N/A
TAGS: EAGR ECON PGOV BL
SUBJECT: LOWER HOUSE PASSES LAND REFORM BILL

REF: LA PAZ 3041

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Summary
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1. (SBU) Movement Toward Socialism (MAS) members of the lower
house of congress approved a land reform bill on November 15
after opposition members abandoned the session. The bill
will now go to the senate, where it is likely to be blocked
by the political opposition. The bill provides for the
bi-annual review of property to determine if it is fulfilling
an "economic and social function." If not, the property can
be reverted to or expropriated by the state. The current
law, passed in 1996, provides for a similar reversion
process, but has not been enforced. The definition of
economic and social function, the circumstances under which
land can be reverted or expropriated, and the structure of
the Agrarian Reform Institute (INRA) will be debated in the
senate. Indigenous groups support the bill, while large
agricultural producers worry that it could endanger food
security. End summary.

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Lower House Approves Bill
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2. (U) Late on November 15, after attempts to reach consensus
failed and the opposition abandoned the session, MAS members
of the chamber of deputies approved a bill modifying the 1996
National Agrarian Reform Institute Law (INRA). The lower
house approved the bill under the pressure of growing
indigenous marches in favor of the reforms (reftel). The
conflictive bill will now be considered by the senate, where
it is expected to be blocked by the opposition parties who
hold a majority of seats.

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Key Principles Yet to Be Defined
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3. (SBU) The bill provides, in line with the current law,
that if property is not fulfilling an "economic and social
function", it can be reverted to the state. (Note: This part
of the 1996 law has not been enforced. End note.) The
reform bill states that even after land is titled, it will be
reviewed every two years to determine if it is serving an
economic and social function. If it is not, it will either
revert to the state without compensation or be expropriated
with compensation. Land can also be expropriated for the
"public good" in order to be given to indigenous communities.
The MAS and the opposition parties did not agree on the main
themes of the reform -- the definition of "economic and
social function," the circumstances in which land can be
reverted or expropriated, and the structure of INRA.

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Indigenous Support; Eastern Resistance
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4. (U) Indigenous groups in support of the bill told the
press that the proposed land reform would return lands to
them which had been taken from their ancestors. Large
agricultural producers and political opposition leaders worry
that the bill will endanger the country's agricultural
production and legal and food security. Leaders of the
Eastern Agricultural Chamber (CAO) threatened to withhold
food produced in eastern Bolivia from the western highlands
to pressure the senate to block the bill until consensus is
reached.

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Comment: No Respect for the Minority
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5. (SBU) Comment: The MAS' passage of the divisive land
reform bill without consensus demonstrates the
administration's determination to enact its agenda with or
without minority approval. Indigenous groups marching to La
Paz from Santa Cruz and the Yungas are raising the public
profile of this issue, as well as pressure on the GOB to
deliver land reform. Without control over the senate,
however, the GOB will have to engage in some creative
politics if the bill is to become law. End comment.
GOLDBERG