Business

Last updated: 29 october, 2009 - 17:05 GMT

Bolivia: The Great Divide

About this programme by Peter Day

On a modest house on a busy road close to the London Business School on the edge of Regent's Park in London there is one of the blue and white plaques that pick out the city's historic places. This one marks a place that really stirs the imagination: it is where Simon Bolivar stayed during his trips to London.

Bolivar is a man of huge influence, not for nothing called "The Liberator". With military genius, he wrestled five Latin American countries from grip of the Spanish occupiers in the early 1800s. He also created the country named after him Bolivia from Upper Peru, and wrote its constitution.

He remains an inspiration to present day leaders such President Hugo Chavez of Venezuela, who talks (endlessly) about his Bolivarian Revolution.

Simon Bolivar still gives the emergent countries of northern South America a kind of cohesion so they have the confidence to stand at a tangent to much of the rest of the world.

Great revolutionary though he was, Bolivar's constitution does not appear to have been completely successful. He was opposed to the idea of separating Upper Peru, and the country has had uncountable dozens of presidents and junta leaders since its independence in 1825.

Wiphala

Bolivia's political racial and economic divisions reflect the extraordinary geography of the place: the harsh and lofty Andes to the West (with the highest capital in the world, the breathless La Paz sitting in its amazing bowl framed by spectacular mountains) and the lush warm productive East, which is also where quite big reserves of oil and gas are located.

The people are very divided too: often wealthy former migrants from Europe of mixed race with big farms and industrial interests who have had political clout for generations, side by side with indigenous peoples, many living in deep poverty and hardship in very tough terrain.

Of course the balance of power between the two groups shifted in 2005 when the country elected its first President from the indigenous peoples. Evo Morales pledged to redistribute wealth and give more to the indigenous community. The country now has a second flag, a striking rainbow-chequerboard called a wiphala, to symbolise the president’s aspirations. Like so much in Bolivia, it is controversial.

Some Bolivian provinces far from the capital in the mountains are very opposed to moves such as the nationalisation of oil and gas and recent changes to the constitution, reweighting political power in Bolivia. Last year saw an outbreak of politically inspired violence in the eastern "capital" Santa Cruz. New elections take place at the end of the year.

Cocaine

Hundred of thousands of indigenous people have moved from the countryside into a new city on the high plain called El Alto next to the airport high above La Paz. It's a cold and exposed place vibrant with life but plagued by poverty and violence, one of the fastest growing cities of Latin America.

It is a far cry from the warmth and comfort of the East, but also far from the distant saltpan deserts to the south where Bolivia is pinning big hopes on extracting the vast supplies of newly-valuable lithium that lie under the huge flat surface of the former lake. (Global Business has already reported on this aspect of Bolivian life.)

President Morales was a coca farmer in earlier life, and coca is an indigenous way of life, chewed by the poor in Bolivia to numb the daily hardship, but also turned into cocaine for export. "Coca is part of our national identity," says the President, referring to the coca leaf. In 2008 he acted to suspend the operations of the US Drug Enforcement Agency in Bolivia.

There is nothing new in the rifts dividing this spectacular country. But the Bolivar revolution is now being restated in a very different way from the way it happened back in 1825.

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Previous updates - October

September

  • The media is going through a 'double-mangle' says Peter Day.

  • In San Diego, Peter Day investigates the company that produces WD40's secret formula.

  • Peter Day looks back on a year of the credit crunch with Simon Johnson, former chief economist for the IMF.

  • Peter Day finds out from the experts how to start a bank.

  • Peter Day looks at the great expectations in landlocked Bolivia and its part in the auto revolution.

August

  • Peter Day asks whether the credit crunch crisis creates a big opportunity for women.

  • Peter Day finds out how to make money out of commodities in the developing world.

  • Peter Day looks at the new communications methods that are changing the way firms do their training.

July

June

  • Peter Day finds out how to innovate your way out of an economic downturn.

  • A sense of time and place is changing Internet businesses everywhere.

  • Social entrepreneurs from Lebanon, Palestine and Egypt who are all innovating and confronting poverty in new ways.

  • A look at a hugely successful childrens TV series and it's boss Magnus Scheving.

  • No business school has a more daunting image than Harvard, 100 years old last year.

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