Page 5, 12th May 1995

12th May 1995
Page 5
Page 5, 12th May 1995 — Harsh reality of the breadline in Bolivia

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Harsh reality of the breadline in Bolivia

To mark Christian Aid Week, Lucy Alexander reports on Bolivia, a country where Western measures are biting

THE LUSH JUNGLE in the east of Bolivia looks deceptively affluent. In truth, only a handful of farmers have fared well over the past ten years, when Bolivia was first subjected to an economic shock therapy imposed by the International Monetary Fund (IMF) and the World Bank. This treatment invariably involves obligawry cuts in public spending, affecting health and education, and opening up economies to the free-market, known as Neo-Liberalism in Latin America.

"We are a Neo-Liberal country, this is the model which has been applied for the past ten years", explains Tomas Coaquira, who is a community leader in Nazareth, a scattering of simple huts in Bolivia's Oriente. "This means I have the right to leave the country whenever I want, but this is difficult for the peasants. We produce little and gain less."

Tomas stands in the yard of his home. Until recently the isolated community he represents received no support. Now a Jesuit organisation called the Centre for the Research and Training of Peasants (CIPCA) has penetrated the jungle and, with Christian Aid funding, peasant farmers are being helped.

In the yard behind Tomas stands his house, a one room but made from sticks and adobe. At his feet are children, chickens and kittens and there are mosquitoes everywhere. Although they are now being helped by Christian Aid and CIPCA, the people of Nazareth belong to the growing number who have slipped below the breadline in Bolivia in recent years. According to the United Nations' official indicators, poverty has risen since Bolivia began to adopt IMF policies and now eight out of ten Bolivians are classified as very poor.

Despite this, and the growing opposition to his policies, the Bolivian president is pushing ahead with his free-market reforms. "But this Neo-Liberalism doesn't do us any good," complains Tomas. "The government says you can buy a tractor or whatever you like now, but we can t. Since 1985 the poor are poorer and the rich are richer."

These free market reforms, part of the IMF's structural adjustment package for Bolivia, have had a similar impact in dozens of developing countries. For the small farmers in the Oriente there is no benefit in the removal of trade barriers. They cannot buy consumer goods like tractors and the only means they have of making a livingselling tropical fruitsis being threatened by cheaper fruit flooding in from neighbouring Chile and Argentina.

President Sanchez de Lozada (or Goni as he is popularly known), the charismatic mining magnate whose English is reputedly better than his Spanish, is treading on ever thinner ice. When he was elected in 1993 people saw him as an innovator with no record of military sympathies or drug scandals.

But this honeymoon is now over. Two weeks ago, Goni declared a 90-day State of Siege in Bolivia in a desperate attempt to control the country. Civil unrest has been growing in Bolivia since February this year, when the latest round of economic reforms, part of Bolivia's second phase of IMF Adjustments, was introduced. These include educational reform and privatisation of Bolivia's main industries.

These measures may have a familiar ring to us in Britain, and they are certainly designed by people from the West. Therein lies the problem. A central theme of IMF adjustments, not only in Bolivia, has been freemarket economics, but developing economies are frequently too fragile for such tough measures. "This is absurd in Bolivia because there are no strong market forces. It's made the problems of adjustment more acute in Bolivia than in other countries where there is a broader industrial-base and a stronger domestic market. In Bolivia the financial market is very small and there isn't even a proper stock-exchange," says Silvia Pabon, director of a Christian Aid-funded think tank, the Centre for Research into Rural and Urban Development.

Yet the IMF and World Bank have concentrated their efforts on improving the market in Bolivia. In 1992, the then President of the World Bank, Lewis Preston, said that "poverty reduction should be the benchmark against which the World Bank is judged." If this is so, it has failed in Bolivia: poverty has grown.

What has gone wrong in Bolivia? For Christian Aid, who have been campaigning against World Bank and IMF policies in developing countries, the situation is 411, too familiar. Large-scale economic achievments like the reducdon of budget deficits through cuts in public spending, modernisation of the economy through free trade and stabilisation of the market to reduce inflation have not helped the vast majority of Bolivia's seven million inhabitants.

One of Tomas's neighbours in the jungle, Fermin Condori, was asked what medical care his three children received; he replies: "This is a real pity. We've never had a doctor here and there arc no plans for one. They built us a health clinic but what good are four walls and a roof if there's no doctor or nurse?"

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