DCM TRIP TO POTOSI AND SUCRE

C O N F I D E N T I A L LA PAZ 001167

SIPDIS

SIPDIS

E.O. 12958: DECL: 04/25/2017
TAGS: ECON PGOV PREL BL
SUBJECT: DCM TRIP TO POTOSI AND SUCRE

Classified By: DCM Krishna Urs for reasons 1.4 (b) and (d).

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SUMMARY
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1. (C) The DCM traveled to Potosi and Sucre April 23-25 to
inaugurate USAID projects and meet with key political
figures. Potosi Mayor Rene Joaquino (often touted as a
potential rival to President Morales) told the DCM that
although the economy is booming, the city receives no mining
revenues, which go solely to the departmental and national
governments. Joaquino said he believes President Evo Morales
has "damaged the constituent assembly" with his declarations
calling for early elections and expressed concern over a MAS
proposal to allow overseas voting in Argentina, saying
conditions would be "ripe for fraud." Potosi prefect Mario
Virreira (MAS) thanked the USG for its continued support and
work with the prefecture and also added that he was ready to
deal with any type of autonomy which may come out of the
constituent assembly (CA). In Sucre, the DCM inaugurated a
USAID sponsored housing project and met with constituent
assemblymen from the MAS, Podemos, UN, and Autonomia Para
Bolivia (APB) parties. The assemblymen were cordial to each
other, but it is painfully obvious that there is a wide gulf
between the MAS and opposition positions. Chuquisaca prefect
David Sanchez told the DCM he does not believe Bolivia's new
constitution will be a copy of Cuba's and that ninety percent
of MAS constituent assemblymen want a constitution that will
be well received by all Bolivians. End Summary.

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MINERS TAKE A TOUGH LINE
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3. (C) During an April 23 meeting with Podemos Senator
Renee Zamora, Congressman Franz Velazco, and Cooperative
Miners Federation Vice President Felipe Flores, Mr. Flores
complained about the government's plan to raise mining taxes
and nationalize the mining industry. VP Flores said the
federation will meet with the GOB May 20 to discuss mining
reforms, but that if the government takes any actions not
agreed upon by the cooperative miners, then "blood will run
in the streets." Senator Zamora and Congressman Velazco made
an appeal for more development projects in northern Potosi to
help stop the flow of migrants to the Chapare at its source
(Note: Jobless migrants from Potosi move to the coca-growing
lowlands and take up coca-growing there, in many cases. End
Note.). Zamora said drug addiction is becoming a problem in
booming Potosi as the suppliers are poor Potosinos who have
migrated to the Chapare to cultivate coca.

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POTOSI MAYOR: CA IS PROBLEMATIC AND OPPOSITION DEAD
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4. (C) The DCM met with Potosi Mayor Rene Joaquino (AS) on
April 23. Mayor Joaquino noted that even though the Potosi
department economy is booming thanks to high mineral prices,
the city receives none of that tax revenue, which goes to the
prefect and national governments. Nonetheless, the city
economy is also benefiting from high earnings by miners. He
cited the example that nine years ago there were 8,000 cars
registered in Potosi compared to 26,000 in 2007. Joaquino
said he believes President Evo Morales has "damaged the CA"
with his declarations calling for early elections. The mayor
said the new constitution may not be approved by the
referendum to be held after the CA completes its work, and
noted that Evo will only call elections if the constitution
is passed. Joaquino expressed his concern over the MAS
proposal to allow overseas voting in Argentina, saying
conditions are ripe for fraud. He does not believe the MAS
will push its proposal to lower the voting age to sixteen as
he thinks "most young people would not vote for the MAS."
The DCM asked Joaquino about the possibility of his running
in the next presidential elections. Joaquino responded that
it is difficult to compete with the MAS' resources but that
the AS is building its network around the country, including
in El Alto where "the people feel they were fooled by Evo"
(Comment: Polls do not reflect this, given Evo's current 80%
popularity in El Alto. End Comment). The mayor said that for
all practical purposes the opposition is dead. Tuto Quiroga,
he said, is "dreadful, and a terrible debater", while Samuel
Doria Medina, a multimillionaire, is "viewed as an oligarch"
and is unable to secure the poor people's vote. Joaquino
said for the time being he will continue to be "prudent."

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POTOSI PREFECT THANKFUL FOR AID
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5. (C) The DCM inaugurated a USAID financed project that
refurbished a patio of the historic prefectural building
along with Potosi Prefect Mario Virreira (MAS). This is part
of USAID's larger effort to strengthen regional governments
as a counter-balance to the central government. The prefect
thanked the DCM for continued USG support and close working
relationship with the prefecture. He told the DCM that even
though Potosi voted against autonomy, he is ready to deal
with whatever form of autonomy may come out of the CA.

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USAID CHAGAS PROJECT
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6. (U) The DCM inaugurated approximately three-hundred and
fifty improved houses as part of a USAID program to help the
municipality of Icla, Chuquisaca and its largely Quechua
citizens to fight the deadly Chagas disease. The event
received favorable press by local and national media. The
program is a joint venture between USAID, the municipality,
indigenous families, and the central government.

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CONSTITUENT ASSEMBLY: THE UNKNOWN
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7. (C) The DCM hosted an April 24 meeting in Sucre with
constituent assemblymen Ramon Loaiza (MAS),Javier Limpias
(Podemos),Ricardo Pol (UN),and Mariano Aguilera (Autonomia
Para Bolivia APB). All four constituent assemblymen remarked
that it took the US Embassy to get them together face to face
to talk about the issues. The opposition expressed their
mistrust and fear that the MAS already has a constitution
drafted. Ramon Loaiza responded that the constitution should
be for all Bolivians and then spoke about forming indigenous
regions and the fourth power of government. Loaiza and
Limpias said they believe the CA can be finished by August 6,
while Aguilera was less optimistic, remarking that the
constitutional commissions are very slow.

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CHUQUISACA PREFECT HAS HOPE
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8. (C) Chuquisaca Prefect David Sanchez (MAS) met with the
DCM on April 25. The prefect told the DCM the CA is working
better now and that he does not think the new constitution
will be a copy of Cuba's. He estimates that ninety percent
of MAS constituent assemblymen want a constitution that will
be well-received by all Bolivians. Sanchez said he does not
know if the new constitution will include prefects and
departments, but in the meantime he is concentrating on doing
his job. When asked about the proposal to move all capital
powers to Sucre, the prefect told the DCM that publicly he
has to support it, but personally he does not. He said he
had spoken to Evo Morales about the subject and was told it
would not happen.

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COMMENT
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9. (C) Potosi Mayor Rene Joaquino is slowly trying to build
his AS party into a nationwide force but early elections and
MAS' massive political machinery funding may be against him.
Post has very good working relationships with Potosi MAS
Prefect Mario Virreira and Chuquisaca MAS Prefect David
Sanchez and will continue to work with both through USAID
projects. The future outcome of the CA remains impossible to
predict. We agree with Mayor Joaquino that Bolivia's
opposition, under its current leadership, has little chance
of regaining the political initiative. Over the next few
months, the key political event remains the outcome of the
CA. Given MAS disorganization, the leaderless opposition,
and persistent economic conflict in volatile sectors,
Bolivia's short-term destiny remains unclear. End Comment.
GOLDBERG