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Morales Expels USAID From Bolivia on Conspiracy Charges

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May 1 (Bloomberg) -- Bolivian President Evo Morales, who traditionally uses May 1 speeches to announce company takeovers, said he’s expelling the U.S. Agency for International Development for conspiring against his government.

“They will surely think that they can still politically and economically manipulate us here in Bolivia, but these times are over,” Morales, 53, said, according to state news agency ABI. The U.S. “conspired” against his government and interfered with labor and social groups, he said, without providing details. Comments by U.S. Secretary of State John Kerry describing Latin America as the “backyard” of the U.S. were also a reason for the expulsion, Morales said.

Since winning the presidency in 2005, the 53-year-old Morales has used his May 1 Workers Day speech to announce the nationalization of the energy industry in 2006 and the main telecommunications company in 2008. A leader of the country’s coca growers union, Morales expelled the U.S. Drug Enforcement Agency and U.S. Ambassador Phillip Goldberg in 2008. Goldberg hasn’t been replaced.

Land-locked Bolivia is the world’s third-biggest producer of the coca plant, according to the United Nations. The bush’s leaves, which are traditionally chewed in the Andean region to ward off hunger and the effects of altitude, contain the base ingredient for cocaine.

USAID Funding

USAID, which has been active in Bolivia since 1964, has supported maternal-health programs, rural farming programs and small and medium-sized companies. U.S. assistance to Bolivia, which includes USAID funding, totaled $28 million in 2012, down from about $100 million in in 2008, according to ForeignAssistance.gov, a website operated by USAID and the State Department.

Morales said his government would cover all programs financed by USAID, La Paz-based newspaper La Razon reported.

The U.S. State Department called the conspiracy allegation “baseless” and said it does “deeply regret” the Bolivian government’s decision.

“We think the programs have been positive for the Bolivian people and we think they have been thoroughly coordinated with the Bolivian government and appropriate government agencies under their own national development plan,” agency spokesman Patrick Ventrell said in Washington.

He said Kerry’s comment about Latin America being in the “backyard” of the U.S. was simply a reference to the importance of relations among neighbors.

Seeking Re-Election

A Bolivian court last week said Morales could run for a third term as president in 2014 after introducing a new constitution in 2009, the newspaper La Razon reported this week.

Under Morales, Bolivia sold bonds abroad last year for the first time since at least the 1920s. Central bank reserves climbed to about $14.2 billion in March from $12 billion in December 2011 and the trade surplus in February soared 186 percent to $546 million from a year earlier. Morales said today he’ll raise public-sector wages for the first time in 11 years by an average 8 percent.

The yield on the country’s dollar bonds maturing in 2022 was little changed at 4.65 percent at 2:05 p.m. New York time.

To contact the reporter on this story: Anna Edgerton in Miami at aedgerton@bloomberg.net

To contact the editor responsible for this story: Andre Soliani at asoliani@bloomberg.net

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