BOLIVIAN TENSION MOUNTS AS ROADBLOCK TALKS CONTINUE

LA PAZ, Bolivia (Reuters) - Tension mounted in Bolivia Tuesday as the
government repeated threats to deploy troops if coca growers, peasants and
teachers do not abandon roadblocks set up 16 days ago that have paralyzed
big cities.

"We're talking, we're working on solutions, but if we stop talking and stop
seeking solutions then we'll clear the roadblocks," Government Minister
Guillermo Fortun said, according to radio news reports.

A government-imposed noon (1400 GMT) deadline came and went as ministers
huddled with peasants in La Paz without soldiers being deployed in the
stalemate with coca growers and teachers. Fortun said as long as talks
continue with one of three protest groups no troops would be sent to clear
highways.

Ten protesters died last week in clashes with security forces over their
demands for higher teachers' pay, abolition of a water tax and opposition
to the eradication of coca -- the raw material used in the production of
cocaine.

"As long as the government is unwilling to discuss the coca issue we won't
have an agreement," said Congressman Evo Morales, head of the coca growers
union.

The situation in Bolivia has become increasingly tense as the blockade of
all roads leading into the capital La Paz and the agricultural hubs of
Santa Cruz and Cochabamba has caused food prices to skyrocket. The Bolivian
air force said it has flown two million pounds of food to La Paz,
Cochabamba, Santa Cruz, San Borja and Cobija to restock supermarket shelves.

"These flights are a guarantee that food stocks in La Paz won't be drawn
down," said La Paz Mayor German Velasco.

While coca growers welcomed a government offer not to build three army
barracks in the coca-growing Chapare region, they refused to lift
roadblocks until the region's 40,000 families are allowed to grow 2.5 acres
(1 hectare) each of coca for traditional use.

Andean Indians use the bitter leaf for religious and medicinal purposes,
including easing the pangs of hunger and thirst and coping with altitude
sickness. Some coca production is legal.

At the height of coca production about five years ago, one in every eight
Bolivians made a living off coca. Bolivia is the world's third largest
producer of coca after Colombia and Peru.

But Bolivia, one of the Western Hemisphere's poorest nations, has
significantly reduced coca production in the past five years in exchange
for U.S. aid.

The government of President Hugo Banzer, a military dictator of the 1970s
who was elected president in 1997, has vowed to rid the nation of illegal
coca fields.

Bolivian government ministers have tried to present a $63 million rural
development package to the peasants which includes crop diversification as
well as the extension of electrical and telephone services to remote areas.

But coca growers are skeptical of government suggestions they grow
pineapples and bananas instead of the bitter leaf.

Meat prices have doubled and the cost of some vegetables quadrupled since
the roadblocks began. Some foreign tourists have been stranded by cut-off
roads or fear of protesters.

While the government negotiated with coca growers and peasants, talks with
teachers failed after an agreement in principle with rural teachers was
reversed by about half of the 50,000 union members.

Teachers were the government's best hope of dividing the coalition of
strikers but the rejection of the plan by Bolivia's 80,000 urban teachers
seemed to turn the tide.

The government offered them a $40 raise for the remainder of this year and
a $200 pay hike over all of next year. Teachers earn $150-$200 a month in
this Andean nation of eight million people, where average annual income is
about $1,000.