Bolivia’s left-wing president Evo Morales has long said that when it comes to foreign investors, he wants partners not owners. He does, though, want to ensue that Bolivia is the owner when it comes to strategic industries. His latest nationalization of two power distributors, Spanish-owned Empresa de Electricidad de La Paz, or Electropaz, and Empresa de Luz y Fuerza de Oruro, or Elfeo, follows previous state takeovers of oil, telecommunications and power generation companies.
Bolivia does, however, need foreign investment to develop its untapped mineral wealth, especially as its gas reserves are diminishing. Natural gas exports have underpinned Bolivia’s steady GDP growth in recent years. Neighboring Brazil and Argentina’s buoyant economies have created an expanding market for Bolivian gas, which is unlikely to continue to prove true in 2013. Foreign natural-resource investors have stayed shy of Bolivia, however. Peru and Chile are more welcoming destinations for their money, and don’t have the overhang of a leftist president who keeps the foreign policy company of Cuba and Venezuela.