Bolivia's President Evo Morales announced Tuesday that his government is completing nationalization of the country's electricity industry by taking over the bulk of its electrical grid from a Spanish-owned company.
Morales also took advantage of the symbolism of May
Day, the international day of the worker, to order troops to take control of
installations of the company, a subsidiary of Red Electrica Corporacion S.A.
"We are nationalizing the Transportadora de
Electricidad in the name of the Bolivian people as a fitting homage to the
workers who fought for the recovery of our natural resources and basic
services," Morales said during a ceremony at the presidential palace.
"We invested $220 million in generation and others
profited. For that reason, brothers and sisters, we have decided to nationalize
electricity transmission," he said.
He did not provide details on how the Spanish company
would be compensated, but the nationalization decree says the state will
negotiate an indemnization fee with Red Electrica.
Bolivian soldiers peacefully took over the company's
offices in the central city of Cochabamba on Tuesday, hanging Bolivia's flag
across its entry.
Red Electrica owned 74 percent of Bolivia's transmission
grid, or 1,720 miles (2,772 kilometers) of high voltage lines. Two years ago on
May Day, the Morales government assumed control over most of Bolivia's
electrical generation and end-user sales, nationalizing its main
hydroelectric plants.
Under Morales, Bolivia's first indigenous president, the
government has moved to place what Morales characterizes as basic services —
energy, water and telecommunications — under state control.
In the case of electricity, the government is returning
to the public domain a sector that was privatized a decade ago.
"Just to make it clear to national and international
public opinion, we are nationalizing a company that previously was ours,"
Morales said.
The 20 percent of the industry the government does not
own is in the hands of small companies serving cities in the eastern lowlands
that are not connected to the national grid.
In his first year in office in 2006, Morales announced he
was "nationalizing" the oil and gas sector. He began extracting
concessions from multinational energy companies, renegotiating contracts to
give Bolivians greater control of and a bigger share of profits from the gas
industry, the country's biggest ahead of mining.
In 2008, he used May Day to announce the completion of
the nationalization of Bolivia's leading telecommunications company, Entel,
from Telecom Italia SpA
However, his government has not been able to complete
negotiations to set a price for indemnization for the power plant takeovers
with GDF Suez of France and Rurelec PLC of Britain.
**Associated Press writer Frank
Bajak contributed to this report from Lima, Peru.