Eduardo Rodríguez might bring an end to one of the South American nation's harshest political crises.

(Angus Reid Global Scan) Gabriela Perdomo - Pressured by the demonstrations of thousands on the streets of La Paz and Sucre, the 19-month-old government of Bolivia's interim president Carlos Mesa came to an end on Jun. 9. Eduardo Rodríguez took office that same night, promising to call a presidential election in the next 150 days.

The appointment of Rodríguez—a 49-year-old lawyer who is not identified with any political party—might have avoided a bloodbath in the Andean nation of 9 million. Protesters demanding the nationalization of the hydrocarbon industry, amendments to the National Constitution, and a call for general elections had stated Rodríguez would be the only consensus choice.

According to the constitution, Rodríguez was third in line to assume executive powers. Predicting an inevitable wave of violence—and following advice from Mesa himself— both Hormando Vaca Díez and Mario Cossío, speakers of the two houses of the National Congress, declined their right to succeed the president.

Last month, thousands of people coming from the poor La Paz suburb of El Alto began the protest when the government introduced a 32 per cent tax on oil and gas production for foreign companies that profit from Bolivia's natural gas reserves—the largest in Latin America after Venezuela. The companies called the new law excessive, while a majority of Bolivians saw it as too distant from Mesa's original promise of nationalizing the industry.

Coca-leaf farmers, impoverished Indians, miners, teachers and students still participate in a non-violent protest led by congressman and coca-leaf farmer Evo Morales. The wealthy elites from cities south and east of La Paz also joined the demonstrations against Mesa, demanding more autonomy for their regions and bigger royalties from the exploitation of national resources.

Now, La Paz and six of the eight regions of the landlocked country are completely blocked and isolated; food and water are scarce and there is almost no fuel left. Right before Rodríguez's appointment, tension mounted as the protest began to turn violent. A miner was killed by the police during a demonstration in Sucre, where the National Congress was meeting, and the military threatened an intervention to disperse the crowd.

Rodríguez promised to deal with the most problematic demand of protesters as soon as possible. If he decides to pursue the nationalization of the hydrocarbon industry, he will face relentless pressure from all sides.

Western multinationals have amassed enormous profits from Bolivia's natural gas reserves since the industry was privatized in 1996. The hydrocarbon industry has been a contentious issue ever since. Former president Gonzalo Sánchez de Lozada, elected in 2002, was ousted after violent demonstrations over the same demands of nationalization in October 2003. Mesa succeeded him then.

Companies such as the United Kingdom's British Petroleum, Brazil's Petrobras, Spain's Repsol YPF and France's Total SA have plenty to lose. Bolivia receives an 18 per cent royalty out of their oil and gas exploitation, as well as the new 32 per cent tax. Some of these corporations, like Repsol, are so upset with the new regulations they are considering legal action against Bolivia.

On the other hand, the wealthy eastern departments of Santa Cruz and Tarija are pushing for a national referendum in November in order to achieve greater regional autonomy, which would allow them to qualify for greater revenue from the exploitation of their soil. Also, Morales and other indigenous leaders have demanded the state to take full control of the industry.

Rodríguez stated he has no interest in remaining Bolivia's head of state. Other than setting a date for the next poll, there is not much he can do during his short mandate. Whoever wins the next election will have to deal with the energy quagmire.

There is no doubt that Morales stands to become a key figure in Bolivia's political future. In 2002, he received 20.9 per cent of the vote in the presidential election. An Aymara Indian and leader of the biggest opposition party, Movement to Socialism (MAS), Morales calls this crisis a "fight between the rich and the poor."

Bolivia's enormous wealth gap seemed to precipitate the current crisis. Being one of the poorest countries in South America, it also holds the largest indigenous population—close to 60 per cent. Like in most Latin American countries, a small elite of Spanish-descendant families controls the economy, while indigenous groups account for the poor majority. Two decades of open-market economy have failed to breach the income gap and fulfill the needs of all Bolivians. A third of the country's population lives on an income of less that one U.S. dollar a day.

According to Morales, native Indians have little say in Bolivia's politics, which is why another key demand is to change the constitution. Indigenous leaders in the country have become more and more noticeable over the past few years. Aside from Morales, names like Felipe Quispe, leader of the dominant Quechua Indians, and Abel Mamani, president of the Confederation of Neighborhoods of El Alto—inhabited mostly by Indian-descent families—have become staples in the political arena.

The United States State Department has already declared Bolivia as a "democracy in need of help." If Morales were to become president, the list of left-wing governments in South America—which already includes Venezuela, Brazil and Peru—would grow. A victory for the indigenous leader might do little to appease Washington.

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