Pubdate: Sat, 07 Jan 2006
Source: Boston Globe (MA)
Copyright: 2006 Globe Newspaper Company
Contact:  http://www.boston.com/globe/
Details: http://www.mapinc.org/media/52
Author: Reuters, Additional reporting by Tamora Vidaillet

BOLIVIA'S PRESIDENT-ELECT COMES COURTING CHINA

BEIJING - Bolivian president-elect Evo Morales arrived in China on 
Sunday, his latest stop on a global tour to discuss exploiting the 
country's massive natural gas reserves and seek aid for South 
America's poorest economy.

China has been courting resource-rich developing countries and 
Bolivia's gas and tin reserves are likely to appeal to the 
energy-hungry nation.

Morales did not speak to the press after touching down in Beijing, 
where talks were scheduled on Sunday with State Councilor Tang 
Jiaxuan and officials from the ruling Communist Party's central committee.

He is to meet Commerce Minister Bo Xilai and President Hu Jintao on 
Monday, a Bolivian embassy spokesman said.

Morales, who takes office on January 22, has already visited 
Venezuela, Cuba and France and is due to travel to South Africa.

As Beijing boosts its presence in Latin American countries where 
Washington has traditionally had strong influence, the leftist stance 
of Morales, who herded llamas as a boy in his poor mountain home, may 
also be attractive to Chinese officials.

A former leader of Bolivia's coca farmers, Morales swept to power 
vowing to be a "nightmare for the United States" and has criticized 
U.S. anti-drug policies.

He has said the gas industry would be nationalized but assets would 
not be seized, without explaining how that might work.

Although the vast distance separating Bolivia from China means it 
would be hard to sell its gas competitively there, Chinese companies 
might still be interested in commercial opportunities.

And with global gas prices rising just as Beijing is trying to push 
use of the relatively clean fuel, officials may also be drawn by the 
hope that improved supply in the tight market could undermine prices.

"Logistically it doesn't make a whole lot of sense but that doesn't 
necessarily mean that the Chinese might not want to be involved," 
said Kevin Norrish, an analyst at Barclays Capital in London.

"I don't think Chinese companies are only getting involved in energy 
projects that can directly supply their own markets, it is much more 
of a strategic issue to become involved in the wider energy sector," 
Norrish said.

However Chinese firms might be discouraged by the uncertainty hanging 
over the sector.

Morales has said foreign firms would have to renegotiate operating 
conditions in the country, whose natural gas reserves are the second 
largest in Latin America after Venezuela's.

They will also lose their rights to extract natural gas at the well head.

During talks with President Jacques Chirac in France on Saturday, 
Morales said he wanted foreign firms to continue investing in 
Bolivia, according to French officials.

Chirac told Morales that foreign investors needed a secure legal 
environment in which to work, a French diplomatic source said.
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