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Viewing cable 06LAPAZ2564, LA PAZ BUSINESS ASSOCIATIONS REMAIN RELUCTANT TO

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Reference ID Created Released Classification Origin
06LAPAZ2564 2006-09-21 20:54 2011-08-25 00:00 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy La Paz
VZCZCXYZ0000
RR RUEHWEB

DE RUEHLP #2564 2642054
ZNR UUUUU ZZH
R 212054Z SEP 06
FM AMEMBASSY LA PAZ
TO RUEHC/SECSTATE WASHDC 0647
INFO RUEHAC/AMEMBASSY ASUNCION 6111
RUEHBO/AMEMBASSY BOGOTA 3429
RUEHBR/AMEMBASSY BRASILIA 7289
RUEHBU/AMEMBASSY BUENOS AIRES 4546
RUEHCV/AMEMBASSY CARACAS 1808
RUEHPE/AMEMBASSY LIMA 1846
RUEHMD/AMEMBASSY MADRID 3126
RUEHME/AMEMBASSY MEXICO 1778
RUEHMN/AMEMBASSY MONTEVIDEO 4020
RUEHQT/AMEMBASSY QUITO 4443
RUEHSG/AMEMBASSY SANTIAGO 9012
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RUEATRS/DEPT OF TREASURY WASHINGTON DC
RHEHNSC/NSC WASHINGTON DC
UNCLAS LA PAZ 002564 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
STATE FOR WHA/AND LPETRONI 
COMMERCE FOR JANGLIN 
TREASURY FOR SGOOCH 
 
E.O. 12958: N/A 
TAGS: EINV ETRD ECON PREL PGOV BL
SUBJECT: LA PAZ BUSINESS ASSOCIATIONS REMAIN RELUCTANT TO 
CRITICIZE 
 
1. (U) Summary: In September 20 meetings, representatives of 
La Paz business associations voiced concerns about the nature 
of Bolivia's economy, the direction of GOB economic policies, 
and the outcome of the Constituent Assembly.  Despite their 
worries, representatives remain reluctant to criticize the 
Morales administration; their low profile approach hampers 
their ability to effectively lobby policymakers.  End summary. 
 
2. (U) In September 20 meetings, National Chamber of Commerce 
Vice President Oscar Medina expressed concern about the 
nature of Bolivia's economy, telling Econoff he believed the 
economy was viable - as evidenced by the export successes of 
furniture manufacturers, textile and apparel firms, jewelry 
makers, and soy and quinoa producers - but relied too heavily 
on natural resources exports.  Medina argued that the economy 
lacks stability, pointing out that populist rhetoric, 
threatened nationalizations, and political and economic 
uncertainty raise business costs and discourage investment 
from Bolivians and foreigners alike. 
 
3. (U) Members of the National Chamber of Industries noted 
that the Bolivian economy lacks not only stability, but also 
judicial security and respect for the rule of law.  Many 
businessmen expressed concern about the direction of GOB 
economic policies, worrying that the Morales administration 
would seek to increase the state's economic weight and bring 
gas, energy, mining, forests, and other "strategic" resources 
under state control.  Chamber representatives expressed fears 
that poorly managed economic policies would hinder long-term 
growth and delay much-needed economic development. 
 
4. (U) Representatives of both associations, along with 
members of the National Chamber of Exporters, also expressed 
concern about the outcome of the Constituent Assembly, noting 
that sharp departures from existing economic policies could 
undermine rather than strengthen economic growth, 
particularly if delegates abandoned free market policies, 
pursued nationalizations, and disrupted exporters' access to 
foreign markets.  Exports, many said, are key to generating 
sustained employment and long-term economic growth, but GOB 
moves to limit trade could threaten success. 
 
5. (U) Despite their worries, business association 
representatives remain reluctant to criticize the Morales 
administration, preferring instead to avoid calling attention 
to the private sector.  Their low profile approach hampers 
their ability to effectively lobby policymakers, and many 
lack access to influential GOB officials. In the absence of 
coherent communications or lobbying strategies, business 
associations make only slow progress, if any, in conveying 
their concerns and shaping GOB policy. 
 
6. (U) Comment: La Paz business associations may be concerned 
about Bolivia's economic future, but they seem unwilling to 
pressure the GOB to maintain investor-friendly policies. 
Some not only refuse to criticize, but subtly align 
themselves with the Morales administration, perhaps convinced 
that relative silence and muted support are the best means of 
protecting their interests.  By keeping a low profile, 
however, they make it easier for the GOB to do exactly what 
they fear most: radically change the rules of the game.  End 
comment. 
URS