Bush Cuts Bolivia Trade Preferences for `Failure' in Drug War
October 16, 2008 - Bloomberg.com

By Bill Faries wfaries@bloomberg.net

Oct. 16 (Bloomberg) -- President George W. Bush called for a suspension of trade preferences that benefit Bolivia, saying the Andean country hasn't done enough to fight drug trafficking.

"Bolivia has failed to cooperate with the United States on important efforts to fight drug trafficking,'' Bush said at a ceremony in Washington where he extended trade preferences for Colombia and Peru. "So, sadly, I have proposed to suspend Bolivia's trade preferences until it fulfills its obligations.''

Bush cited Bolivia, Venezuela and Myanmar in an annual report submitted to Congress last month, saying they "failed demonstrably'' in the past year to fulfill obligations to fight narcotics trafficking. Bolivia is the world's third-biggest producer of coca, the main ingredient for cocaine, after Colombia and Peru; the U.S. is the world's largest cocaine consumer.

U.S. ties with Bolivia have been strained since the election of President Evo Morales in December 2005. Morales, a former coca grower, says the U.S. hasn't done enough to fight cocaine consumption within its own borders and called the drug report "blackmail.'' The two countries expelled each others ambassadors after violence in eastern Bolivia last month that Morales said was aided by the U.S. envoy.

"There should be a certification process for those who are fighting drug trafficking by eliminating the consumer market,'' Morales, 48, said during a speech in La Paz Sept. 17. "Drug trafficking responds to the market.''

The U.S. imported $363 million worth of goods from Bolivia in 2007 and exported $278 million, according to the U.S. Department of Commerce. Bolivia's gross domestic product was about $13 billion last year, according to Bloomberg data.

U.S. and Bolivian authorities recognize legal uses of the coca leaf in Bolivia, where it has been chewed for religious and cultural purposes for centuries. Coca tea is widely sold in the Andean nation.

Bill Faries in Lima.