BOLIVIA: BOLIVIAN PRESIDENT SWEARS IN NEW CABINET IN EFFORT TO SOLVE AUSTERITY CRISIS

Record ID: 550532

  • Title: BOLIVIA: BOLIVIAN PRESIDENT SWEARS IN NEW CABINET IN EFFORT TO SOLVE AUSTERITY CRISIS
  • Date: 19th February 2003
  • Summary: LA PAZ, BOLIVIA (FEBRUARY 19, 2003) (REUTERS) GENERAL SHOT OF MINISTERS AT CEREMONY
  • Embargoed: 6th March 2003 12:00
  • Keywords:
  • Location: LA PAZ, BOLIVIA
  • Country: Bolivia
  • Topics: Economy,Politics
  • Reuters ID: LVA1H204IUC1TPSQC8DGNSBGTYCR
  • Story Text: Bolivian President Gonzalo Sanchez de Lozada has reshuffled his Cabinet in an effort to refresh his administration and mollify angry Bolivians after 32 people died last week in riots over government austerity measures.
    Bolivian President Gonzalo Sanchez de Lozada (gohn-ZAH-loh SAHN-chez dae loh-ZAH-dah) reshuffled his Cabinet on Wednesday (February 19), appointing a new head of his economic team to refresh his administration after 32 people died last week in riots over government austerity measures.
    "There is no doubt that what has happened over the past few days has damaged all the country and especially the cabinet.
    It has to be replaced. We will never forget them [the ministers] but they have to be replaced," Sanchez de Lozada said at a swearing-in ceremony at the presidential palace only a week after his government survived the worst riots in decades in this poor landlocked nation of 8 million people.
    The president named Sen. Moira Paz (MOY-rah pahz) as planning and sustainable development minister, the government's top economic post. Paz is seen as more politically adept than her technocratic predecessor, Jose Justiniano (hoh-ZAE hoos-teen-ee-AH-noh).
    Several unpopular ministers were also replaced, including Presidency Minister Carlos Sanchez, whom the opposition had blamed for cracking down on protesters.
    "I am confident that the new organisation is an organisation that above all is efficient and we are going to evaluate it every month like the people are going to evaluate it," Sanchez de Lozada said.
    Sanchez de Lozada was was forced to back down on International Monetary Fund calls to raise taxes after last week's riots, during which he was smuggled out of the presidential palace in an ambulance.
    Growing protests by Bolivia's indigenous majority have sparked fears that one of the Western hemisphere's poorest nations could be rocked by political instability after 20 years of market reforms.
    Sanchez de Lozada has been trying to negotiate an aid package that would also pave the way for the country to obtain more loans from multilateral lenders. But on Sunday (February 16) he said a new budget "was not going to be an IMF budget,"
    reflecting the fine line he must walk between placating social protests and appeasing IMF demands to cut the budget deficit.
    While backing down on salary taxes, the president on Wednesday reduced the number of ministries from 18 to 13 to cut costs.
    However, a crowd of protesters standing outside of the Government Palace during the swearing in ceremony of the new ministers seemed unimpressed.
    "For me, this is not a change. We are still the same.
    He is only changing ministers, but these people are going to occupy other places," said one citizen.
    "The change of ministers and the recovery of ministers, of vice-ministers, is not going to solve the problems of the country. It is necessary to fix the businesses of the country that do international trade, so that the Brazilians, for example, are not afraid to enter this country because each area is blocked," explained another Bolivian.
    Sanchez de Lozada also wants wage increases for the police, the armed forces and other public sector employees. However, the IMF wants Bolivia, slowly emerging from a four-year recession, to cut its budget deficit from nearly 9 percent of GDP last year to 5,5 percent in 2003.
    Around 60 percent of Bolivians live in poverty and many live on less than $2 a day.
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