 |
Bolivia Nationalizes the Oil and Gas Sector
The Nationalization Spree Contd..
Many European companies, especially those from Spain, had operations in Bolivia. Spain expressed concern over the announcement and said that the step would not be in the best interests of Bolivia. Brazil too expressed deep concern over the announcement. Brazil's President, Luiz Incio Lula da Silva (Lula da Silva) immediately convened a meeting with the CEO of Petroleo Brasileiro SA (Petrobras) and other senior officials from the mines and energy department to discuss the impact of this announcement on Brazil. The trend of government control over energy resources in South America started in Venuzeula, the fifth largest oil exporter in the world, when Hugo Chavez (Chavez), President of Venezuela, imposed heavy taxes and other conditions on foreign companies operating in this sector. |
|
Antoine Halff, energy analyst at Fimat International Banque SA,7 said, "This is a continuation of the trend toward increasingly aggressive resourcenationalization that we have seen across many countries in Latin America, starting in Venezuela. The measure is in line with the populist tone of the new regime in Bolivia; however, how it is carried out in practice still seems somewhat unclear."8 It was reported that another South American country, Ecuador, was also considering nationalizing the oil and gas sector. Some analysts saw the nationalization in Bolivia as an attempt to control vital energy resources against the backdrop of the rising oil and gas prices worldwide and to derive political mileage from it.
