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Bolivian leader bets his future on gas referendum

LA PAZ, Bolivia — Bolivians will decide Sunday how to develop the nation's huge natural gas reserves in a referendum that is vital for President Carlos Mesa as he battles to stave off a revolt by indigenous Indians.

Widespread fury at plans to export natural gas lay behind a siege of the capital by Indian groups last October, in which dozens of people died and Mesa's pro-Washington predecessor, President Gonzalo Sanchez de Lozada, was ousted.

Mesa called for the referendum — which asks if voters want to allow gas exports and have more state control over one of Latin America's biggest reserves — to appease poverty-stricken Indians that are a majority of Bolivia's 8 million people.

A "Yes" vote would help Mesa's fragile government. A "No" vote or a threatened Indian boycott could force the president to quit and risk the road blockades and protests that brought South America's poorest nation close to civil war last year.

Polls show a majority of voters could back Mesa. But with five complicated questions, referendum results may be unclear.

"It's a vote of confidence in Mesa. An ambiguous result or a "No" vote could spark violent unrest," said Mark Falcoff, a Bolivian expert at the American Enterprise Institute in Washington.

Unrest in Bolivia would be another setback for Latin America, where democratic leaders from Venezuela to Peru face protesters unhappy with social and economic progress since the end of military rule over the last two decades.

Washington worries that instability in Bolivia, the world's third biggest source of coca — the leaf used to make cocaine — could lead to more drug smuggling from the Andean region.

Colonial Silver Mines

Opposition to exporting gas shows how Bolivians, who grow up with tales of their ancestors' slavery in Spanish colonial silver mines, have come to reject decades of market reforms they say help foreign firms and European-descended elites.

"The gringos will take our gas like they stole our silver. They get richer and we get poorer. I'm going to spoil my vote," said Luis Aruquipa, who sells wood sculptures to tourists.

Using arguments rejected by most orthodox economists and energy experts, the Indians want to throw out foreign energy companies, nationalize gas production, and guarantee affordable gas supplies for millions of poor Bolivians.

Some radical Indian leaders have called for a boycott of the vote, saying they want to impose a "state of siege" on Bolivia. They say the referendum is worthless because it does not ask whether gas production should be nationalized and foreign companies thrown out.

"We're going to burn the ballot boxes," said Indian leader Felipe Quispe, a former guerrilla known as Mallku, the Aymara Indian word for chief. "Mesa is a cheat like all white people. He has the beard of a conquistador."

Last month, in an incident that shocked Bolivia, Indians burned alive a mayor they accused of corruption, setting him aflame in the town square and hanging him upside down from a lamppost.

It was part of growing anger by indigenous peoples and mixed race descendants in the Andean region. Across the border in Peru, villagers lynched a mayor accused of corruption. Unpopular Peruvian President Alejandro Toledo faces a general strike Wednesday.

Indigenous leaders in the ramshackle town of El Alto, which controls access to La Paz and was the focus of the siege last year, have called for a strike from Friday.

But the 50-year-old Mesa, who is popular in polls, has remained defiant and ordered troops to ensure that people vote.

"We're going to show the thugs, the radicals, that you and I believe in democracy," Mesa said in a TV address.

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