Bolivia threatens to nationalize its mining industry
Following up on last week’s nationalization of its natural-gas industry, Bolivia (that’s in South America, in case you don’t remember seventh grade) now intends to exert greater state control over its mineral resources as well. President Evo Morales is vowing to nationalize the mining industry, though Vice President Alvaro Garcia Linera has said otherwise. Either way, dirt-poor Bolivia intends to raise taxes and royalties on foreign investment. Morales warned that if foreign partners “don’t respect these laws, we’ll make them respect them with political force.” Ominous. The announcement may dampen interest in a deposit of an estimated 44 billion tons of iron ore, being auctioned by Bolivia with the condition that extraction be fueled by natural gas. One gold-mining mogul responded to Morales’ announcement by suggesting that Pakistan — yes, Pakistan — is suddenly a more attractive option for investment, despite al-Qaeda presence in the country. Ouch.