The privatisation of national assets by private companies produces poverty and prevents government from having resources for welfare state investments, Bolivian President Evo Morales argued yesterday.

In a passionate speech given during the opening ceremony of the second Oil and Gas Congress in the city of Santa Cruz, Morales exhorted head of states from all around the world to nationalise their natural resources to ensure a new “paradigm of social development.”

He gave as example the “substantial positive change” for the Bolivian economy produced by the nationalization of oil and gas in May 2006, run ever since 1995 by 21 different multinational companies.

Morales said that the nationalisation of local energetic assets allowed Bolivia to cherish a net foreign-exchange reserves of US$13 billion in the last five years, compared to the FX reserves figure of only US$700 million of 2006 – the year he took office.

It was the second lowest FX reserves figure in the region, just above Haiti, the poorest country in Latin America and the Caribbean.

“The administration of the wealth of nations in the hands of private causes poverty and prevents governments have financial resources to invest in social programs,” he said, criticising the greed of international companies that make “poverty grow.”

Morales also pointed out that in six years “more than a million Bolivians crossed the poverty threshold. “How much was the public spending in social policies in 2005? From just US$600 million [of that year], this year we extimate it will be of more than five billion,” he explained.

Following Argentine decision to nationalise YPF, on the last 1st of May, President Evo Morales announced the nationalisation of the Spanish-owned electric company Red Eléctrica Internacional SAU.

His administration has nationalised telecommunications, power generation and electricity transmission companies, as well as polymetallic mills.

“We don’t need [foreign] owners of our natural resources. We do need partners and operators, and we will meet and greet companies that have understood our proposal,” he said, referring to the multinationals who already agreed to the new conditions estabilshed by the state.

Bolivia holds the second largest reserve of natural gas of South America, estimated to 20 trillion cubic feet (TCF), a 14% of Venezuela’s one (147 TPC, the largest one of the whole continent).

Debate continues with another marathon day of meetings in the Chamber of Deputies over the nationalisation of YPF. The bill will provide for the recovery of state control of YPF and is slated to be signed into law tonight, settling the contentious issue.

The session, which began yesterday at 3.30 pm and closed at midnight, resumed this morning at 10 am.

Before coming to vote, members of the Chamber of Deputies will listen to speeches from 10 am to 6 pm. The bill has already been endorsed by the Senate where the measure secured 63 votes in favour, 3 against and 4 abstentions.

Out of the 257 members of the House, the bill is predicted to raise between 210 and 215 votes.

Consensus is not unanimous on the issue. Radical deputy Hipólito Faustinelli said this morning that the official project to expropriate the shares is “unconstitutional” and predicted he will retire from the room at the time of the vote.

According to preliminary assessments carried out by different parties, the negative votes are to be between 34 and 38, abstentions at 4 to 6, and absences from 4 to 10.

Should the bill be passed, it will allow for the expropriation of 51% of the shares of YPF by the state, granting the Argentine government a majority share of the company.

Despite the apparent finality of the vote, debate may continue with disputes over share price in the take-over of Repsol’s stake. Spanish Foreign Minister, Jose Manuel Garcia Margallo is urging Argentina to pay a ‘fair price’ for their actions.