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For months now, Bolivia has seemed to be on the verge of cracking apart. Massive pro- and anti-government rallies have been held, and four of the country’s lowland provinces have scheduled referendums on declaring their autonomy from the federal government in La Paz. One of these referendums, in the keystone department of Santa Cruz, has already passed. Civil war, or at least the implosion of the state in its current form, has at times seemed like a looming possibility.
At stake is control over the country’s natural gas reserves and agricultural wealth. In the context of skyrocketing global prices for energy and food, ensuring control of these commodities has taken on a new importance for La Paz. The country’s producing regions, however, are also emboldened by their rising economic power and do not want to cede control to the central government.
To understand what is happening, it is important to realize that there are really two Bolivias: the wealthy, Europeanized eastern lowlands and the poorer, indigenous western highlands. The Andes region in the West is home to the country’s indigenous majority and 64 percent of the population, while to the east are fertile, resource-rich lowlands mostly inhabited by the better-educated, European-descended minority.
Much of the divide has its root in economic realities. The highlands depend mostly on mining and coca production for income, while the lowlands are home to the country’s lucrative natural gas deposits and fertile farmland. Together, revenues from agricultural and energy exports provide some 47 percent of the revenue for the central government. The vast majority of Bolivia’s natural gas deposits lie in two lowland departments: Tarija, which holds 85 percent of the country’s reserves, and Santa Cruz, which holds 10.6 percent. Tarija borders Paraguay and Argentina and pipes natural gas directly to these two countries, and Santa Cruz has another critical pipeline linking Bolivia to Brazil.
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