Bolivia will take no more American drug money

Flag_of_Bolivia_(WFB_2004)In a speech this May Day, the Bolivian president Evo Morales announced that he would expel the US Agency for International Development (USAID) from his country. The response from the American government has been shocked, bordering upon outraged, but their message is clear: this will harm Bolivian people more than it will harm them.

It is true, of course, that suspending projects to improve the healthcare of Bolivian people will have damaging consequences upon those that rely on the aid and perhaps this is irresponsible of their President. Yet America has other reasons to be worried. Their relations with Bolivia are strongly linked with their ‘War on Drugs’, as Bolivia (with Peru) is one of the main producers of the coca leaf, used to make cocaine imported to the US. Coca has been a source of contention between the two countries for years, with Morales maintaining that it is part of their cultural heritage (not to mention their economy).

The Bolivian decision is also worrying to the international donor community as a whole. In 2005, OECD countries (including the US) announced the Paris Declaration on aid effectiveness; this placed emphasis on ‘country ownership’, meaning the aid recipient countries’ own government should be responsible for deciding where the aid is spent. Morales clearly feels that he is not receiving the freedom he would like from relations with the US and his expulsion of USAID marks a reassertion of sovereignty in the face of foreign pressure. In the past, donors have been able to dictate policies to recipient countries in exchange for funds; Morales’ move signifies a shift towards developing countries’ belief in the autonomy of their own administrations.

Country ownership should be beneficial to everyone; it encourages responsibility, which is likely to lead to more robust systems which could ‘wean themselves off’ aid in the long-term. Yet the Bolivia-America clash over coca shows how it can be disadvantageous to donors. In January this year, the UN decriminalized traditional uses of coca in Bolivia (although it is still illegal to export), which was a major victory for Morales; he had an overwhelming majority, with only 15 states, including the US, voting against it. This was the first time Morales had affected international policy, claiming that ‘acullico’ (chewing a wad of coca leaves) was an integral part of Andean identity which had been ‘demonized’ by the international community as drug abuse. In short, it marked a victory for Bolivian interests over American ones.

It is easy to see the American side, here; the most important way of dealing with Class A drug abuse (which causes incredible damage to individuals and their families) is to stem the flow of raw ingredients into the country. It is reasonable, then, that America would prefer the criminalization of coca in Bolivia so that producers can be penalized. Yet if this is not in Bolivian interests, then the US has no right to pressure the Bolivian government to conform to the policy. Giving aid is supposed to be purely philanthropic; it does not give richer and more powerful countries semi-colonial rights over poorer ones. Though of course there are other reasons why Morales has expelled USAID (he claims a conspiracy against his government), the principle remains that he has reasserted power over his relationship with a donor; this has huge implications.

The question remains how Morales can afford to reject USAID? The reason why donors have had leverage in the past is because they could withdraw funds if the recipient did not play ball. How is it possible for Morales not to bow to this pressure? The US will say that he can’t, that he’s being irresponsible and that poor people will suffer. Yet in an increasingly-globalized world, the number of donors is diversifying and money can be sought from other sources. Many ‘developing countries’ are (suggested by their name) growing economically and are thus a good source of investment.

China and Japan, for example, invest in infrastructure in developing countries and profit by access to natural resources for their own industries. This is a more promising prospect for countries like Bolivia, who receive investment without the political strings attached from the West. One would expect the US to be the most important donor to Bolivia, having given $2 billion through USAID in the last 50 years. Yet Japan has also invested $1.4 billion over the last 40 years (and does not have as much interest in criminalizing coca…)

So what is the implication for international affairs? Morales’ decision will send shockwaves through the donor and recipient communities alike; it shows that poorer countries are decreasingly dependent on their old donors and that their autonomy over their own policies is now less likely to capitulate to economic pressures. In short, a seemingly small and unimportant country has given America the finger, and this is more powerful than it might seem.