USAID/OTI Bolivia Hot Topics May 2005

Gas Connections

Rather than enriching the country, Bolivia's most lucrative natural resource, its gas reserves, has become a political issue that threatens both economic and political stability. Conflict surrounding the gas issue led to the forced resignation of President Gonzalo Sánchez de Lozada in October 2003. His successor, President Carlos Mesa, has spent much of his tenure struggling with hydrocarbons legislation. In March 2005, after weeks of protest over the gas issue that paralyzed Bolivia and was strangling the already struggling economy, President Mesa offered his resignation to Congress, which was rejected.

The Office of Transition Initiatives/Bolivia is working to support the government's initiative to bring natural gas to the people of Bolivia. Not only will this help the government to be responsive to the people's demands, but it will help to de-politicize the issue of natural gas by giving Bolivians access to their own resource at the same time that it is being exported.

Beginning in February 2005, OTI/Bolivia worked with a private company to install an industrial gas valve that will allow natural gas hookups for an entire district of El Alto, bordering on the capital of La Paz. This pilot project is the first in a series of gas connections for schools requested by President Mesa. The project will work through the State Hydrocarbons Company (YPBF) and the often-disruptive neighborhood association Fejuve. OTI is funding the valve and pipeline construction through a private company and will work directly with 14 educational/community facilities to rehabilitate bathrooms and kitchens to benefit 7,000 students and over 9,000 residents ($88,000 total).

The pilot project offers enormous potential for recognition of the government for following through on the demand for gas in El Alto. As educational centers are able to pool resources to maintain the connection and to reach a larger population, these types of connections are cost- effective, especially because domestic connections and fees are often prohibitively expensive.

In addition to being an economical use of education funds, the project has immediate political impact by bringing together the Government of Bolivia and Fejuve. In the past, Fejuve has been one of the most disruptive elements in El Alto, often spearheading street demonstrations. This project represents one of the first times that Fejuve is working with the government for the benefit of the people of El Alto. This is an important precedent demonstrating that needs and demands of a community can be met by working through the institutions of government.

Supporting conflict prevention and community development in El Alto is OTI's core programmatic focus. To date, more than 200,000 alteño citizens and officials (out of a population of 800,000) have benefited from OTI activities.

For further information, please contact:

In Washington, D.C: Amy Frumin, LAC Program Manager, 202-712-4231,