President Mesa offered his resignation to Congress as huge protests engulfed the capital for the past two weeks. These protests were led by angry leftist and Indian groups, demanding nationalization of Bolivia’s energy industry. But they are not the only angry group in the country – there are equally angry people in Santa Cruz, where the energy is located. Crucenos, many of whom are industrious immigrants, very much want the oil and natural gas industries developed through private means, as they would be in a normal country, with critical foreign investment so that jobs and a dynamic economy will be created. Whether such privatization would happen in an equitable way, or in the Latin American way of rewarding special interest groups, is something I do not know. The angry indigenous groups fear the latter and the industrious Crucenos hope for the former. Something matters here.

We knew this resignation was coming, given the implacability of the conflict, but it still comes as a shock. Bolivia just lost a president 20 months ago, and nearly lost Mesa 3 months ago. It’s rapidly heading for a power void, something which could be filled by force with unsavory elements like Evo Morales. Violence and demonstrations are escalating, not calming down, now that the president has offered to resign.

NEWS ROUNDUP:

ASSOCIATED PRESS – First news item; says the country is possibly headed toward civil war now. The resignation is the handiwork of leftist protesting mobs who have choked the capital and outskirts for weeks.

ASSOCIATED PRESS: also has a short summary of the characters and issues at stake.

REUTERS: Congress has yet to decide whether it will accept the resignation or not. Evo Morales repeats his call for total nationalization of the gas industry.

BLOOMBERG (Link updated): Evo Morales and crew are calling for new elections. Undoubtedly, they don’t want the next-in-line Congress President Hormando Vaca Diez in power because he is seen as a Santa Cruz autonomy advocate. Congress cannot meet to decide on this unless their safety is guaranteed from Morales’ protestors who are mobbing the capital. So it creates a standstill of some kind. Meanwhile, water supplies have been cut off to parts of La Paz, food hasn’t been able to get through due to Evo Morales’ roadblockers and protests are swelling. Commentators say this is no tactical resignation like last time, President Mesa’s really going for good and god knows what will follow. Companies stand to lose tens of billions in investment.

INDEPENDENT ONLINE of South Africa has a superb summary report of all the developments, really explaining out the mechanics of how the next president could be chosen. It also notes that the streets are quiet now that Mesa has offered his resignation. Vaca Diez says that the Congress might meet in Sucre or Santa Cruz because La Paz is so protest-filled. Meanwhile, Evo Morales does not believe that Mesa’s resignation is genuine. The borders to Chile and Peru have been shut down by protestors. If you can only read one news account, read this one.

ASSOCIATED PRESS: The OAS, meeting in Fort Lauderdale, Florida, has its first big challenge on democracy, and declares it wants to help Bolivia, but is not sure how. It does not want to intervene.

THE NEW YORK TIMES: Forero reports that while Hormando Vaca Diez, the next in line, does not have enough popular support to govern Bolivia if he succeeds Mesa, the third-in-line, Eduardo Rodriguez, who is Supreme Court president, probably does. He also notes that Evo Morales wants new elections.

CATHOLIC WORLD NEWS: The new pope prays for peace in Bolivia. I guess he knows what comes from these kinds of situations, from experience.

HAARETZ: Israel airlifts all of its citizens from Bolivia amid strife and unrest.

ABC NEWS AUSTRALIA says that some Aussies have been trapped for 8 days in La Paz and hope they will be able to escape.

XINHUA: Argentina calls for dialogue and understanding to resolve the situation.

INVESTOR’S BUSINESS DAILY has an editorial warning the West not to abandon Bolivia, because failing democracy will destroy any democratic pretenses in the OAS if serious action to stop this mob rule and coming civil war does not take place. NEW ITEM

ASSOCIATED PRESS reports that despite there being a couple of palatable presidential successor candidates from existing political mechanisms, baying mobs outside the Congress are demanding none of them and insisting on Evo Morales as their leader. There is chaos. NEW ITEM

BBC: Mesa’s offer to resign does not impress the howling mobs outside Congress. They are growing. NEW ITEM

REUTERS reports that Standard & Poor’s credit rating agency cut Bolivia’s sovereign outlook to negative from stable, citing the insoluble severe political crisis. This doesn’t raise the cost of borrowing on the international credit markets but portends a coming cut in the credit rating itself, which will indeed raise costs of borrowing for Bolivia. Investors’ risk has gone up. NEW ITEM

AGENCIA ESTADO reports that Brazil (which has the most to lose from a collapsing Bolivia) has offered to mediate in this crisis. NEW ITEM

PEOPLE’S DAILY reports that the OAS made a declaration that it regretted the deteriorating situation in Bolivia, and hoped dialogue and respect for human rights would be the next step. NEW ITEM

MIAMI HERALD reports that the U.S. sees the hand of Hugo Chavez in the current ongoing strife in Bolivia. A top State Department official said that Chavez’s profile in this was “very apparent” from the beginning. “Glenn was right. NEW ITEM

FT warns that civil war is looming. NEW ITEM

ASSOCIATED PRESS says the U.S. State Department has put out a travel advisory urging all U.S. travelers to stay out of Bolivia for all except the most essential travel. NEW ITEM

HAROLD DOAN & ASSOCIATES, citing a press release, says the U.K. foreign office has advised its nationals the same thing. NEW ITEM

REUTERS: LAN Chile airlines and American Airlines have suspended all flights to La Paz. NEW ITEM

REUTERS: Standard & Poor????????s ratings agency has revised downward the sovereign outlook on Bolivia, from stable to negative. It cited Bolivia????????s insoluble political crisis. The downgrade should not raise Bolivia????????s cost of borrowing on credit markets but does portend a likely downgrade on the actual credit rating of the country which will indeed raise Bolivia????????s cost of borrowing on the international capital markets NEW ITEM

BLOOMBERG reports that shares of Repsol YPF, the remains of Argentina????????s oil company before it was privatized and bought by a Spanish company, have tumbled due to its high investment exposure to Bolivia, where it has energy concessions. NEW ITEM

UPI: The OAS has rejected a U.S.-proposed democracy-monitoring mechanism but accepted a watered-down version of a U.S. proposal to strengthen democracy in the Americas. NEW ITEM

HERALD SUN reports that violence is engulfing the capital and early elections are the only means of heading off civil war. NEW ITEM

BLOGGER ROUNDUP:

Daniel at VENEZUELA NEWS AND VIEWS, has the first report. He says the bleak scenario to follow this resignation, assuming it happens, and given the divisions in the country between privatizers and nationalizers, is probably civil war. There is very intense sentiment on both sides.

Miguel at MABB reports that the rumors are flying in La Paz. Be sure to see the two photos he has to accompany his post.

Miguel at MABB reports in more detail that Congress is most likely to accept the resignation this time, as the Catholic Church’s efforts to mediate this goes awry. The man likely to take Mesa’s place is Hormando Vaca Diez, the vice president who’s identified with Santa Cruz autonomy, and someone hated by the Evo Morales protest crowd. Who succeeds Mesa will be influenced by Evo Morales.

Eduardo at BARRIO FLORES notes that Mesa went out saying he was glad he didn’t shoot protestors doesn’t want his presence to be an obstacle and hopes his exit will bring lasting peace.

Eduardo at BARRIO FLORES also has a copy in Spanish of Mesa’s resignation speech.

Miguel at CIAO! reports pitched battles already happening in the streets of La Paz, and radical indigenous supporters of nationalization marching onto Santa Cruz province where locals there vow to form ‘self-defense’ forces. Meanwhile, another huge protest is set to choke La Paz. This is extremely disturbing. Miguel says it’s much worse than the situation in 2003 when President Goni Sanchez de Lozada resigned amid a hail of violence. He writes:

In his resignation speech, Mesa highlighted that he never used force to quell conflicts. History will judge him for that. And the outright failure that was his 19 months in office. Did his inaction make a future crackdown necessary and/or inevitable? And w/ both likely successors ???????? Vaca Diez (MIR senator, Santa Cruz) & Mario Cossio (MNR deputy, Tarija) ???????? less sympathetic to El Alto demands, how can this possible smooth things over?

IVINTERNATIONAL reports that Hormando Vaca Diez, the man set to succeed Mesa, has held his first press conference. He says drop the blockades and there will be no repression. The Indian group leaders say no dice. Among them, Evo Morales seems fearful.

Nick at OPEN VEINS has a slew of protest photos, well worth seeing. I can see the icy temperature in the air, and it makes me wonder what that Andean winter is going to be like without fuel if civil war makes energy scarce.

Nick at OPEN VEINS has also got a beautifully done essay about what he sees on the ground in south La Paz which is rich and chi chi, and what he sees of the indigenous protestors, all of whom have deep commitment and readiness to sacrifice (sadly -ammyl) for the cause of nationalization. It’s a moving descriptive essay of this tragedy in the making. Hat Tip: MABB

Alexey at ALEXEY WRITES has a list of newspaper links if you can read Spanish, as well as some of the best bloggers already listed here. He has a riveting firsthand email from a pal named Nancy, excerpted here, but go read the whole thing at his site:

now there is little food to buy, the supermarkets are half empty, prices are gone up drastically and the queues are very very long in all shops. it got worse in the evening, they protesters managed to cut the water. So no water in 3 areas of La paz, no bread either no where in la paz, and no gas. yes, it looks bad, all of la paz is blocked you can not go out and you can not get in. the airport is still closed and there are no buses, no cars. so even if i wanted to go i couldnt. most resturants are closed too. and most shops.

Alvaro at BLOG DE BOLIVIA in Santa Cruz has found a new blog on Bolivian affairs with a link, that he likes.

BOLI-NICA, the blog that Alvaro likes, has a humdinger bit of news about where Evo Morales gets his cash – it’s via the produce rackets of Buenos Aires. That was what they were whispering at a Chavista party in the area.

Daniel at BOLIVIA TE AMO has a slew of letters to the editors around regional newspapers, depicting a variety of local sentiment – it’s in Spanish.

CIUDAD DE LAS FLORES reports blockades in a rich part of Cochabamba, with bikes being allowed to get through, but not cars.

Antonio at THE ECONOMIST EN SU LABRINTO reports, if I am reading this right, that the indigenous protestors seem to be protesting neckties as well as privatization.