BOLIVIA BUCKLES AGAIN TO PROTEST MOVEMENTS

Government Agrees To Indians' Demands

LA PAZ, Bolivia -- The Bolivian government agreed Friday to a broad range
of demands by Indian peasant leaders, buckling under the pressure of three
weeks of road blockades that paralyzed the economy, caused food shortages
and threatened to force the resignation of President Hugo Banzer.

The government met the most important demands of the Aymara-speaking
peasants after Indian leaders threatened to surround La Paz and starve the
capital in a replay of a bloody Indian rebellion in 1781. Government
ministers agreed to prop up corn prices, reverse a land-titling process
that would have raised taxes and revert government water rights back to
Indian peasants.

It was the second time in six months that Banzer had been forced to retreat
on government initiatives in the face of massive protests to avert a
collapse of his authority and the shaky Bolivian economy. Political
analysts said his growing signs of weakness will probably invite more
costly protests in the coming months by the restive labor and peasant
movements.

Shortly before reaching an agreement in the pre-dawn hours Friday, the
economic-development minister, Jose Luis Lupo, said this country of 8.1
million people had suffered losses of at least $120 million in damages to
roads, lost foodstuffs and interrupted exports during the past three weeks.
"This is the worst crisis Bolivia has faced since 1985, when we had a
24,000 percent inflation rate," he said.

Despite all the concessions, the government has refused to accept demands
by coca growers in the Chapare region to stop short of the government goal
of eradicating all coca plants by Feb. 1, 2001, and allow peasant families
to grow small private plots. The Chapare coca growers, who continue to
block roads between the cities of Cochabamba and Santa Cruz with stones and
logs, agreed to resume separate talks with the government.

With funding and technical help from the United States and United Nations,
the Bolivian government as of Thursday had reduced coca plantings in the
Chapare region, the main cultivation area for Bolivian cocaine exports, to
4,050 acres from 70,400 acres in 1998, according to the U.S. Embassy.

In previous negotiations with the coca growers, the government agreed last
month to forgo plans to build three new army bases in the Chapare area. But
Banzer has pledged that he will not back down on his vow to destroy the
remaining coca crops in the Chapare region in the next three months, and
then destroy 6,000 acres of illicit coca cultivation in the Yungas region
early next year.

"We say illegal coca cultivation will be zero in 2002, and we intend to
keep to that goal," said Lupo, the economic development minister, in an
interview.

Congressman Evo Morales, the leader of the coca growers, said Friday that
his movement would continue to march and block roads until the government
backs down. But Morales appears to be in an increasingly isolated position
now that the larger peasant confederations have agreed to halt their
protests. He is widely expected to give up the road blockade in the next
few days or face military action.