IMF Warns Bolivia on Nationalization.

[happydreams]

IMF Warns Bolivia Of 'Consequences' Of Nationalization


By . Agence France-Presse
May 19, 2006 -- The International Monetary Fund warned Bolivia May 18 of "far-reaching consequences" of its decision to nationalize oil and gas resources, if the move is not handled properly. IMF spokesman Mahsood Ahmed said the impoverished South American nation may lose access to foreign capital if it fails to compensate companies affected by the nationalization.


"The decision of the Bolivian government to nationalize the hydrocarbon sector has potentially far reaching economic consequences," the IMF spokesman said. "In terms of how these aspects are handled, it could have an impact on the continued availability of domestic and foreign private capital to be invested in the hydrocarbon sector which is an important part of the Bolivian economy."

Bolivian President Evo Morales announced the nationalization plan May 1, saying the country was recovering its assets. Although many details remain unclear, foreign companies have up to 180 days to renegotiate their contracts with the state-run Yacimientos Petroliferos Fiscales Bolivianos (YPFB), which will become the majority shareholder in the reformed corporations. During the transition period, 82% of profits will go to the Bolivian state and 18% to corporations.

The IMF, which has a team of experts in Bolivia, urged the new government to discuss terms of the plan with multinational companies in the coming six months. Ahmed said the talks should cover "discussions on the compensation for the nationalized assets, the nature of new operating contracts and possibly an increase in export prices to Brazil and Argentina."

Copyright Agence France-Presse, 2006

http://www.industryweek.com/ReadArticle.aspx?Artic...

[SoCalDem]

1. DUH.. That's what Bolivia is trying to do..

They don't want any part of the WTO/IMF/WB. Part of nationalization is to reclaim their assets so they don't NEED to borrow from international loansharks

[cliss]

6. That's what I think

as well. The IMF is obviously treating Bolivia as a 3rd world 'helpless' country, and it needs to be told what to do.

I think Mr. Morales has been on the phone with Hugo Chavez.

As long as oil keeps ticking up in price, Bolivia and Venezuela and Iran will continue to grow in power. They hold all the cards, and not the oil end users.

You're right: they don't need the evil IMF. They'll do just fine without them.

[happydreams]

8. No kidding. It does have a certain "parting shot" quality

about it. Chavez has been paying off Venezuela's loans way ahead of schedule to avoid this kind of entrapment. Maybe Morales has the same idea in mind.

[XemaSab]

2. What would happen if every nation in Latin America and the Carribean

decided to default en masse on their IMF/World Bank loans?

This is a serious question.

[AX10]

4. That would result in a massive loss of money to the US.

Seeing that the US is the largest donor to the IMF....

[AX10]

3. The IMF seeks to make the third world safe for corporate raiders.

The IMF needs to close it's doors for good! That would be the first and only good thing they ever could do.

[AlamoDemoc]

5. "The IMF, which has a team of experts in Bolivia,..."

I suppose they are the so-called Economic Hitman of South America.

[SoCalDem]

7. If someone takes over your home, sells your stuff

and makes deals with criminals to take the rest of your stuff, aren't you entitled get your stuff back?

Unscrupulous leaders sieze power, sell off national resources, but once they are booted out of power, those "deals" MUST be revisited..

Bolivia has it figured out.