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• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP84S00552R000200100004-4
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 15
• Document Creation Date: January 12, 2017
• Document Release Date: July 5, 2011
• Sequence Number: 4
• Publication Date: May 1, 1983
• Content Type: REGULATION

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Directorate of
Intelligence
Bolivia's Foreign Policy:
How Far to the Left?
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ALA 83-10071
May 1983
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?F'E\ Directorate of Secret
Bolivia's Foreign Polio
How Far to the Left?
This paper was prepared by I Office
of African and Latin American Analysis. Comments
and queries are welcome and may be directed to
the Chief, South America Division, ALA,
This paper was coordinated with the Directorate of
Operations and the National Intelligence Council.
Secret
ALA 83-10071
May 1983
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secret
Bolivia's Foreign Policy:
How Far to the Left? F 25X1
Key Judgments Since assuming Bolivia's presidency in October 1982, Hernan Siles Zuazo
Information available has implemented a new leftist foreign policy that has dramatically altered
as of 14 April 1983 his country's traditionally strong support for many US positions. For
was used in this report.
example, Bolivia has established diplomatic relations with Cuba and
Nicaragua, recognized the PLO as the legitimate representative of the
Palestinian people, and consistently either voted against the United States
or abstained in several international forums, particularly the United
Nations.
We believe there are several reasons that account for Siles's commitment
to his foreign policy line, despite its potential consequences.
? At age 70, Siles is more willing than at any other time in his 40-year po-
litical career to take risks in order to leave his personal leftist stamp on
Bolivia.
? The radical orientation of the President's closest advisers-who, taken
as a group, constitute the most extreme left element in the government-
reinforce his foreign policy initiatives.
? At least for the moment, Siles continues to have unusual latitude to
implement his philosophies because Bolivia is "coup weary"-since 1978
alone the country has had 10 different governments.
? Bolivia's inability to secure from traditional lenders enough capital to
halt the country's precipitous economic decline leads Siles to court new
non-Western sources.
There are several constraints on Siles's actions, but those with the greatest
potential influence have only begun to manifest themselves. The anti-
Communist Bolivian military is still in some disarray since the return to ci-
vilian rule last fall, even'though it retains the capacity to regroup quickly
and oust Siles. The President's civilian political opponents of the center and
right, meanwhile, are formulating congressional challenges and seeking
tentative alliances with the armed forces in an effort to halt the govern-
ment's leftist policies.
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At present, we judge the most important, active constraint on the President
to be his continuing desire to maintain good relations with the United
States-still Bolivia's primary source of economic aid. This, plus Siles's
genuine appreciation for the US role in helping restore democracy to
Bolivia, has led him to delay temporarily some leftist foreign policy
initiatives, including recognition of North Korea and the People's Republic
of China.
In our view, however, Siles believes that he has sufficient room to
maneuver within these constraints to maintain leftist initiatives without
jeopardizing continued aid from the United States. We believe he calcu-
lates that Washington's commitment to civilian rule will forestall any
serious deterioration in relations and help keep Bolivian coup plotters in
check. Further, his personal and political commitment to the leftist course
will continue to be overriding. The President, therefore, will proceed with
most of his policies-albeit on a slower track.
Over the next six months, we expect that, regardless of promises made to
the United States, La Paz will:
? Expand existing diplomatic and other links with Cuba.
? Consider accepting small numbers of Cuban and Nicaraguan specialists
in agriculture, education, medicine, and possibly intelligence.
? Establish relations with North Korea and possibly the People's Republic
of China.
? Expand longstanding commercial ties with various Communist nations,
especially with the Soviet Union in the field of mining technology.
We also believe that this course probably will, before the year is over, unite
Siles's diverse opponents. These galvanized civilian and military critics will
make common cause with ambitious dissenters from within the administra-
tion and, with likely encouragement and support from Buenos Aires,
probably will force Siles from office.
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The United States 6
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= Venezuela GEORGETOWN
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Kilometers
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Falkland Islands
(Islas Malvinas)
(administered by U.K.,
claimed by Argentina)
*BRASILIA
Boundary representation is
not necessarily authoritative,
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Bolivia's Foreign Policy:
How Far to the Left? P
The inauguration of leftist President Hernan Siles
Zuazo on 10 October 1982 marked the return of
democratic government to Bolivia after 18 years of
nearly continuous military rule. Almost immediately
the President began to implement a new foreign
policy, which dramatically altered the country's tradi-
tionally strong support for most US diplomatic posi-
tions. This paper reviews the policy shifts to date;
examines the reasons behind Siles' strategy; surveys
foreign and domestic constraints to his foreign poli-
cies; predicts likely future policy decisions that affect
US interests; and assesses the implications of the
President's actions for the survival of his government. President Hernan Siles Zuazo
A 40-year veteran of Bolivian politics, Siles was one of
the principal leaders of the 1952 revolution, Latin
America's most dynamic social upheaval since the
Mexican experience of 1910. Siles played a major role
in implementing the revolution's goals: nationalization
of the mining industry, enfranchisement of the peas-
ants, and establishment of a major agrarian reform
program. His early and deep personal commitment to
revolutionary programs-best reflected today in his
government's foreign policy-was tempered by prag-
matism during his first term as President (1956-60),
but never significantly compromised.
During the years of military rule after 1964, Siles
spent much of the period in involuntary exile, laying
the groundwork for his eventual return to the presi-
dency. In 1973 he founded the center-left National
Revolutionary Movement of the Left (MNRI). Siles
also broadened his leftist appeal and secured a major
portion of the important labor vote by joining with
two other parties-the Movement of the Revolution-
ary Left (MIR) and the Bolivian Communist Party
(PCB)-in 1978 to form the powerful Democratic and
Popular Unity (UDP) coalition.
As the UDP presidential candidate, Siles captured a
plurality of the popular vote in both the 1979 and
1980 elections, winning a decisive 2-to-1 victory over
his closest rival in the latter contest. A parliamentary
deadlock in 1979 and a military coup in 1980 prevent-
ed him from assuming office, but with the military's
voluntary relinquishment of power in October 1982,
Siles returned to Bolivia and was installed as presi-
dent by the newly seated Congress.
From his first days in office, Siles has charted a
strikingly new course for Bolivia's foreign policy, in
which relationships with far-left governments and
radical organizations have become the norm. Thus, a
warm welcome was extended to the high-level delega-
tion, headed by Cuban Vice President Carlos Rafael
Rodriguez, that Havana sent to Siles's inauguration.
This was best illustrated by Rodriguez's unprecedent-
ed address to the new Bolivian Congress. Prior to this
occasion, the two nations had had little contact since
the Bolivian Army captured and executed Che Gue-
vara in 1967. Recognition of the Sandinista regime in
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Nicaragua-the first official foreign policy act of the
new government-was followed by the establishment
of similar ties with Cuba. In addition, the regime has
publicly recognized the PLO as the legitimate repre-
sentative of the Palestinian people and has endorsed
the West Saharan Polisario Movement.
US Embassy reporting notes that not only is Siles's
desire for closer ties with Cuba especially strong, but
that in- this he has been encouraged by most of his
advisers and the other parties in his coalition. He
believes that Cuba's leadership position in the Third
World can greatly benefit Bolivia,
the President is an admirer of Cuban
achievements in agriculture and mass education and
would like to follow Castro's example in these fields.
Moreover, he believes that in return for Cuban prom-
ises of financial assistance-aid, which we believe is
unlikely to materialize-and diplomatic support,
Bolivia must, at a minimum, accept an official Cuban
presence in La Paz. Thus, we believe that the an-
nouncement by Bolivia's Foreign Minister while in
Nicaragua in January of a formal resumption in
diplomatic relations with Cuba was premeditated,
despite Siles's contention that the minister exceeded
his instructions.
Bolivia's relations with the Soviet Union also have
improved under Siles, but more in terms of atmos-
phere than concrete advances. The two countries
already had diplomatic relations at the ambassadorial
level, and the USSR has been involved in funding a
major Bolivian tin volatilization project for over a
decade. The US Embassy reported that top officials of
the Bolivian state mining corporation recently trav-
eled to the Soviet Union in hopes of securing credits
totaling $250 million for a second tin plant and
assorted mining machinery. Movement on this propos-
al probably will be slow, and we have no information
Bolivia's voting record in international forums, on the
other hand, illustrates well the significant changes of
the new foreign policy. At the 37th United Nations
General Assembly, the Bolivian delegation either
absented itself or voted against the United States on
such key issues as Afghanistan, Israeli and Kampu-
chean credentials, chemical weapons, Namibia, and
human rights. In most cases, Bolivian officials re-
sponded to subsequent US representations with what
appeared to be lame excuses of fouled communica-
tions between the delegation and La Paz. In the
Nonaligned Movement, as well, Bolivia frequently has
opted for radical positions. Most recently, at the
regional preparatory meeting for the UN Conference
on Trade and Development, Sixth Session (UNCTAD
VI), Bolivia joined with Cuba, Nicaragua, and Suri-
name in an unsuccessful attempt to eliminate the
moderate sections of the final declaration.
With Siles's approval, the regime also has prominent-
ly displayed its association with specific leftist organi-
zations. Since last October, for example, La Paz has
played host to several meetings of leftist Latin Ameri-
can political parties. One recent gathering-as de-
scribed by the US Embassy-was both partially paid
for and attended by exiled Argentine Montonero
guerrillas. The US Embassy also reported that Siles
has considered granting political sanctuary to this
group, despite the strain such a move would place on
Bolivia's relations with her powerful and influential
southern neighbor.
Siles has shown some willingness to suspend, at least
temporarily, planned foreign policy initiatives for
pragmatic financial reasons.
offer of a $3 million loan to La Paz, the President not
only temporarily shelved his plans to recognize the
People's Republic of China
Korea are following a similar pattern. In our view,
economic considerations are the primary reason for
the derailment-at least temporarily-of Bolivian
recognition of North Korea. The US Embassy in La
Paz reported that in March a key presidential adviser
raised with South Korea the possibility of either
canceling a large government-to-government debt
owed by Bolivia or a cash grant from Seoul in return
for his efforts to block the establishment of diplomatic
relations with P'yongyang.
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We believe that Siles's age plays an important role in
explaining his motives for pushing his foreign policy
beyond traditional bounds and those he set in his first
term. At 70, the President probably realizes that this
is his last opportunity to sit in the presidential palace.
Hoping to leave his mark on Bolivian history, we
judge Siles is far more likely to take risks and follow
his own personal beliefs-regardless of the political
consequences-than at any other time in his career.
Historical studies show that Siles views himself as a
revolutionary. We believe that the new policies enable
him to reaffirm publicly his leftist credentials and
showcase what we judge to be his genuine belief in the
principles of nonalignment. Along these lines, the
President has proved willing to modify several of
Bolivia's traditionally pro-Western positions in order
to demonstrate his country's new Third World orien-
tation and independence from the United States.
In addition, the country's virtual political exhaustion
has provided a rare opportunity for executive leader-
ship. Since 1978 Bolivia has had 10 different govern-
ments, with 1982 alone witnessing three changes. As a
result, during his first 100 days in office, Siles found
himself governing from an almost unique position-
we believe that both his opponents and the general
populace, weary of constant governmental turnover
and the accompanying political paralysis, were willing
to allow the new regime considerable leeway. Thus,
the President has been formulating his new policies in
an environment remarkably free from serious coup
plotting.
The desperate need for additional capital to begin
redressing Bolivia's economic decline also is pushing
Siles's foreign policy leftward,
To some extent, this requires the President to
walk a tightrope to avoid jeopardizing essential eco-
nomic assistance from the United States. Despite the
apparent contradiction, however, his country's eco-
nomic problems are so severe that we believe Siles is
convinced he must expand Bolivia's sources of eco-
nomic aida
Weak demand and low prices for Bolivia's key miner-
al exports-tin, lead, and zinc-have helped precipi-
tate the current economic downturn. Moreover, the
situation has been aggravated by the government's
refusal thus far to implement economically necessary,
but politically costly, austerity measures. Real GDP
fell 1 percent in 1981-the worst performance since
1957-and final figures for 1982 are expected to show
another 8 to 12 percent decline. Siles is therefore
soliciting additional funds from new lenders, includ-
ing those on the radical left.
The President also has publicly agreed to permit-the
PLO to open an office in La Paz, apparently in hopes
that the organization's influence with wealthy Arab
nations ultimately will work to Bolivia's economic
advantage.
Leftist policy actions are not only reinforced, but
sometimes initiated by Siles's closest advisers, who,
taken as a group, constitute the most radical element
in the government. Close presidential adviser and
MNRI Executive Secretary Felix Rospigliosi illus-
trates the extreme views of this clique, which also
includes MNRI Congresswoman Tamara Sanchez
Pena, Janet Rospigliosi (Felix Rospigliosi's niece), and
MNRI public relations officer Elias Clavijo. Accord-
ing to the US Embassy, Rospigliosi, an avowed
radical, has urged Siles to break relations with the
United States, dissolve the Bolivian Congress, create
armed peoples' militias, and follow the Cuban/Nica-
raguan development model. Despite the President's
refusal to accept any of these proposals, he is, we
believe, in fundamental agreement with many of the
less extreme views of this adviser, and we suspect
disagreements are often more over timing than the
policies themselves. For example, Siles continually
solicits Rospigliosi's views and gives him the opportu-
nity-through television appearances, trips abroad,
and participation in formal cabinet meetings-to
speak and act on the government's behalf.
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dependence of Bolivia on the United States.
danger to his hold on power posed by the military
regime in Argentina, as well as of the deep economic
thority or privileges
The Military
The primary internal check on any Bolivian president
is the military-historically the nation's most cohesive
and powerful political organization. Despite a wide
variety of social and political philosophies within the
officer corps, disagreements are quickly submerged
when challenges arise either to the institution's au-
Che Guevara in 1967
Of particular importance to Siles are the military
institution's foreign policy views. All military factions
are not only fiercely anti-Communist, but, more
specifically, anti-Cuban. Many "progressive" offi-
cers-those allegedly supportive of democracy-
proudly claim to have participated in the capture of
even in this group-whose support is
Allowing Rospigliosi wide latitude can work to Siles's
tactical advantage, in our view. There has already
been some tendency for the government's detractors
to criticize Rospigliosi and the policies as much as
Siles. This could leave the President some maneuver-
ing room in the future by enabling him to deflect
criticism through the demotion or removal of Rospig-
liosi.
We believe Siles's leftist foreign policy initiatives face
their greatest potential opposition from powerful do-
mestic institutions, such as the military and the
established center and right political parties. Exter-
nally, Siles is almost certainly aware of the direct
mentsJ
crucial to Siles-concern is mounting over Bolivia's
increasingly close ties with radical leftist govern-
The military's unusually muted reaction so far to
Siles's foreign policies is probably due to three factors.
The abject failures of military regimes since 1979
have left the armed forces more concerned, at least
temporarily, with rehabilitating their image than with
wielding power. For his part, the President-even
while restoring ties with many nations considered
anathema by the armed forces-seems to have al-
layed the officers' worst fears by thus far limiting the
sizes of these, countries' missions in Bolivia and refus-
ing such offers as Cuban teachers or medical person-
nel. A third factor is the lesson learned by the armed
forces when it seized power in 1980: alienation of the
United States can lead to a total withdrawal of US
assistance, which can seriously complicate effective
rule.
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We believe, however, that the military's current quies-
cence will diminish with time. We expect that contin-
ued leftward movement by the Siles government will
eventually provide yet another in a long line of Army
strongmen, with a compelling argument-a perceived
Communist threat to the nation-for uniting dis-
parate military factions.
Political Parties
Siles's foreign policy also is beginning to encounter
opposition from another important quarter-the well-
established domestic political parties of the center and
right. ormer
President Victor Paz Estenssoro-Siles's most im-
placable foe over the last 25 years and the leader of
the country's second-largest political party-is spear-
heading the civilian drive against the government.
The Argentine concerns that lead to this type of
interference are primarily political and related to
security. Many top Argentine military leaders-both
past and present-fear that a leftist civilian regime in
La Paz will allow the country to become a major base
for exiled Argentine guerrillas or transform Bolivia
into a Cuban surrogate state on their strategic north-
ern border.
The hostile Argentine attitude toward Siles has been
demonstrated in several ways. For example, Buenos
Aires granted political asylum to the most notorious
members of the Bolivian military, who fled the coun-
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We believe, however, that for
Paz, the regime's foreign policies seem less a genuine
grievance than a convenient excuse to promote his
own political advancement. Moreover, without strong
military backing, the civilian political sector does not
possess the power to depose Siles.
In recent years, that country's conservative military
leaders have sponsored several destabilization cam-
paigns against Bolivian presidents who were deemed
Argentina
Through its close army-to-army ties with the Bolivian
military, Argentina represents a potentially major
foreign constraint on the actions of the Siles regime,
because it poses a direct threat to his hold on power.
threatening to Argentine interests.
Siles seems to us well aware not only of Argentina's
political influence and geographic proximity, but also
of her value as a commercial partner-Argentina is
the principal consumer of Bolivian natural gas, for
example. For this reason, he has consistently ex-
nressed a desire for cordial hilateral relations_J
Siles views
Bolivian-Argentine relations in the same manner as
he sees those between the United States and the
USSR-effective and positive in spite of deep-seated
hostility between the two governments.
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Nevertheless, Sites seems less concerned than we
judge prudent about antagonizing the Argentines with
his foreign policies. His proposal earlier this year to
grant asylum to exiled Argentine Montoneros-an
initiative that he reportedly still has under advise-
ment-is the most striking example of this attitude.
The United States
In our view, the President regards his continuing need
to maintain good relations with the United States-
Bolivia's primary source of economic aid-as the most
important active constraint on his foreign policy. Most
of the concessions to moderation he has made-such
as the postponement so far in accepting a Cuban
ambassador or establishing relations with North
Korea-have come at Washington's urging. The
United States traditionally has ranked first among
providers of bilateral foreign financial assistance and,
in recent years, has been second only to the Inter-
American Development Bank as a source of donor
funds. Besides being a major purchaser of Bolivian
exports, the United States is the primary supplier of
both capital goods and sophisticated equipment need-
ed by the country's important mining and petroleum
industries. Finally, US influence with international
financial institutions and other lenders can affect
loans to Bolivia.
Sites appreci-
ates the importance of this relationship; he believes he
has reduced anti-US propaganda in Bolivia and has
instructed his ministers to maintain friendly relations
with the United States. The President repeatedly has
pointed out in discussions with his administration's
officials the limitations placed on Bolivia's diplomatic
position by the country's economic crisis and its
dependence on the United States. At the same time,
he acknowledges publicly the prominent role the
United States has played in isolating past military
governments and promoting the restoration of democ-
racy in Bolivia.
All of this helps to moderate Siles's foreign policy, but
primarily, we believe, only by delaying additional
leftist initiatives. For example, despite repeated assur-
ances to the United States that Bolivia would not
establish diplomatic relations with Cuba in the fore-
seeable future, Foreign Minister Velarde used the
occasion of the Nonaligned Coordinating Bureau
meeting in Managua last January to announce the
restoration of formal ties. Similarly, following strong
US protest of this action, Sites pledged to delay the
exchange of diplomatic personnel with Havana for at
least six months. Nevertheless, after the arrival of an
unsolicited Cuban Charge in La Paz less than two
months later, Sites accepted his credentials unofficial-
ly and permitted him to begin de facto diplomatic
o erations. US Embassy reporting
reveal that this failure to respond to US
representations against Bolivian foreign policy actions
inimical to US interests has developed into a fairly
clear pattern.
Bolivia's voting record in the United Nations is an-
other instance of double dealing with the United
States. Late last year, Sites promised to condemn the
Soviet invasion of Afghanistan in both his speech to
the UNGA and his 1983 New Year's Day speech in
La Paz, but in both cases such remarks were left out.
In conversations with the US Embassy, high-level
Bolivian representatives said they were unable to
explain the deletions.
Sites's administration officials-obviously recognizing
the potential costs of antagonizing the United
States-usually have been sobered by successive US
demarches and have promised to avoid or delay action
on controversial initiatives. We believe, however, that
the factors cited above-Siles's age and revolutionary
commitment, his advisers, the enormity of Bolivia's
economic needs-work to offset the significance of
Washington's position, until eventually the President
reneges on his agreements. Early in the Sites adminis-
tration, the US Embassy attributed some policy ac-
tions to confusion and lack of coordination in the new
government. The consistent pattern of the last six
months, however, leads us to conclude that the course
of Sites's foreign policy is largely premeditated and
under the guidance of the President, even though he
sometimes allows day-to-day direction by others
That Sites has suffered few direct setbacks from his
policies to date probably has helped convince him that
he may be able to continue in this manner. His
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recognition that the United States will be angered by
many of his actions probably is tempered by a belief
that Washington's commitment to democratic rule in
Bolivia not only will forestall any serious deterioration
in relations, but may help keep Bolivian coup plotters
in check. Although the Bolivian military and Argenti-
na have, we judge, more potential influence over Siles
than the United States because of their willingness to
take direct action to oust him, so far neither has
manifested its concerns as directly as the United
States and thus probably is not yet acting as a
significant restraint on the President.
Because we believe that Siles and his advisers are
committed to moving Bolivian foreign policy leftward
despite their awareness of the inherent political risks,
we expect the current pattern to continue. Siles's
promises to the United States notwithstanding, we
believe that Bolivia's unofficial acceptance of the
Cuban Charge's credentials in La Paz indicates that
these relations will be raised to the ambassadorial
level within the next six months. The President proba-
bly also will permit an increase in the sizes of the
diplomatic missions of such new partners as Nicara-
gua. Because Siles admires the advances these coun-
tries have made in agriculture, education, and medi-
cine, we expect that over the next several months he
will begin to consider receiving some small numbers
of Cuban or Nicaraguan specialists in these fields. In
our view, if the presence of such specialists does not
spark significant opposition, Siles also may accept
from countries unfriendly to the United States a very
few advisers to his government, including intelligence
officers. We believe relations with North Korea and
the People's Republic of China will also be established
if either South Korea or Taiwan, respectively, falter in
their "aid" programs to Bolivia.
In addition to these new initiatives, some longstanding
commercial ties with Communist countries probably
will be expanded, in part because of the efforts of the
two cabinet ministers who are members of the Boliv-
ian Communist Party. The efforts of Bolivian state
mining corporation officials to secure $250 million in
Soviet assistance for planned projects and equipment
are an example of Bolivia's attempt to build on a
decade of Soviet financial involvement in a tin-
processing enterprise.
The risks that these initiatives pose for Siles are high.
By continuing to promote Bolivia's shift to the left, he
will play into the hands of powerful domestic oppo-
nents who are seeking a plausible pretext to unify
their ranks and move against him. We believe that the
impact of these initiatives, regardless of any major
grievances on the domestic front, probably will, before
the year is over, unite Siles's diverse military and
civilian critics long enough to force his ouster
In the interim, we believe that US demarches will
induce Siles to continue to make at least some effort
to respond to US interests. For example, in an attempt
to address US concern over Bolivia's relations with
the PLO, Siles recently sent a letter to the President
of Israel assuring him of Bolivian support for the
Camp David accords as a basis for a peaceful settle-
ment in the Middle East. Similarly, a move to assuage
US anger over Bolivia's voting record in the United
Nations-specifically the failure to condemn the So-
viet invasion of Afghanistan-resulted in an official
Foreign Ministry statement repudiating the occupa-
tion of that country by foreign troops. Yet, even these
kinds of concessions will probably be forthcoming
only as a result of fairly continuous and heavy US
pressure. We judge that the more fundamental com-
mitment to an overall leftist foreign policy will not be
voluntarily abandoned or significantly diverted.
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 Sanitized Copy Approved for Release 2011/07/05: CIA-RDP84SO0552R000200100004-4
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Secret
Sanitized Copy Approved for Release 2011/07/05: CIA-RDP84SO0552R000200100004-4