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Last Updated:  Thursday, 20 February, 2003, 08:16 GMT
Bolivia shuffles government

By Tom Gibb
BBC correspondent in Sao Paulo

President Gonzalo Sanchez de Lozada
Bolivia's president is under pressure to meet IMF targets
Bolivia's President Gonzalo Sanchez de Lozada has formed a new government a week after protests left 33 dead and hundreds injured.

Five ministries have been abolished and eight ministers replaced as part of a cost-cutting measure to cut back on the government's deficit and meet IMF targets.

This appears to be a last-ditch effort to save the government after Bolivia's most violent protests in decades.

These were sparked last week when the government tried to introduce income tax.

The police went on strike, leading protests from every sector of society.

Gun battles

The army was called in to restore order but used live ammunition for crowd control, resulting in gun battles with the police which caused most of the deaths.

President Sanchez de Lozada has already withdrawn the income tax proposals.
Furniture burns on the streets of La Paz amid protests
Protesters lit fires in La Paz

The ministers most blamed by the opposition and the press for the bloodshed have also been replaced.

And instead of raising taxes, the presidency is trying to cut down the size of the government, abolishing a third of the country's ministries.

But he will almost certainly still need leniency from the IMF, which wants significant reductions in the government deficit.

The Bolivian president may get some help because he is seen in Washington as a key ally in the war against drugs.

The main opposition leader, on the other hand, is the representative of Bolivia's coca growers, the plant used to make cocaine.



Nancy Birdsall, Centre for Global Development
"The IMF has to try and work out something with this government"

Uneasy calm returns to Bolivia
14 Feb 03 |  Americas
Bolivia's banks down but not out
08 Aug 02 |  Business
Country profile: Bolivia
03 Dec 02 |  Country profiles
Timeline: Bolivia
03 Dec 02 |  Americas

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