Country Reports on Terrorism 2007 - Bolivia

With political instability, a weak and fluctuating legal framework, increasing coca cultivation, and the opening of diplomatic relations with Iran, Bolivia showed new potential as a possible site for terrorist activity. Supporters and actors from the National Liberation Army (ELN), the Revolutionary Armed Forces of Columbia (FARC), the Tupac Amaru Revolutionary Movement (MRTA), the Paraguayan Free Fatherland Party (PPL), and the Shining Path were thought to be present in Bolivia.

In December, following 16 months of deliberations within a Constituent Assembly, President Morales' Movement to Socialism (MAS) party approved a new draft constitution with little input from the political opposition. The government's actions divided the country with five out of nine departmental governors calling the new constitution illegal and illegitimate. Opposition departments (states) may hold autonomy votes in May and June. Bolivia's uncertain political and economic climate, and an increase in coca production, could lead to increased trafficking of illicit goods and money across Bolivia's borders.

In September, the Bolivian government announced the opening of diplomatic and commercial relations with Iran. The September 27 agreement pledged $1.1 billion in Iranian assistance to Bolivia over five years. In addition, Bolivia received continued medical and intelligence support from Cuba, with which it has had a close relationship since 2006. The Bolivian government's ineffective anti-money laundering regime failed to comply with international norms. In July, the Egmont Group suspended Bolivia's membership when it did not criminalize the financing of terrorism.

In October, the Peruvian government requested the extradition of Walter Chavez, a close advisor to the Bolivian government. In 1990, Chavez was arrested in Peru for alleged illegal activities and involvement with the MRTA, and was released on bail and disappeared before turning up in Bolivia in 1992. The Bolivian government vowed to defend and protect Chavez, arguing that he was a political refugee protected by international agreements.