Clashes between pro- and anti-government supporters in Bolivia have led to people being killed [AFP]

A new round of talks between the government and the opposition are set to be held in Cochabamba, central Bolivia, amid high expectations of a possible agreement between the two parties.

The talks on Monday are to take place in a remote and quiet area outside the city to avoid any tension or clashes between supporters from either side.

The country is still coming to grips with the violent incidents in the eastern province of Pando, where 19 people were killed three weeks ago.

Evo Morales, the Bolivian president, seems to have the upper hand in his confrontation with the opposition for probably the first time since he came to power in 2006.

He has proved that he controls the army, or at least has sufficient control to send troops to the northern region of Pando to end a standoff between his supporters and his opponents.

He also had the governor of Pando arrested and accused of genocide and replaced by an appointed army officer under martial law. 

Nobody knows how difficult that must have been to achieve, since rumours have been circulating for quite a long time over the army being divided on Morales' rule and whether to topple him in a coup.

But it remains clear that the opposition did not anticipate such tough measures coming from Morales. 

Revising constitution

Morales is now willing to accomodate some opposition demands [AFP]

Many people believe that had Morales not sent the army to Pando, Santa Cruz's reaction would have been different.

The president's supporters, mainly farmers, decided to suspend their march to give negotiators a chance to reach an agreement, clearly following instructions from Morales, who is keen to hold a referendum on the new constitution on December 7.

To achieve that, he is now willing to accommodate some of the opposition's demands of keeping some sort of a regional autonomy. 

For a long time, he has repeatedly said he would not revise the constitution after it had been approved in December last year in Oruro by the constituent assembly, in the absence of opposition representatives.

"Our government made a mistake when it said 'no' to the idea of autonomy and we are paying the price for that mistake now," says Oswaldo Peredo, a local pro-Morales leader in Santa Cruz. 

"If we don't admit that, then we will never be able to make up for our mistake."

Troubled opposition

The opposition in Bolivia is now in a delicate situation [EPA]

Whether or not an agreement is reached very soon, the opposition is already in a delicate situation.

Its leaders are already jeopardising their voters' trust by simply accepting that they have to discuss and negotiate their regional autonomies with the government. 

"We voted back in May on our autonomy, and we said yes. What was that?  A game?" says Maria Santos, a resident of Santa Cruz, the biggest opposition region, where the local authorities spent $11 million to organise the referendum.

"Our leaders said autonomy or nothing. And now we are negotiating?"

In Santa Cruz, Tarija, Beni and Pando opposition leaders have already started implementing their autonomies, although the referenda in which local voters supported these autonomies are considered illegal and unconstitutional by the country's judiciary. 

The government accuses the leaders of those regions of being separatists, and wanting to topple Morales.

"What we are doing is not for fun, nor do we have the intention to destabilise President Morales' government from here," says Juan Carlos Parada, president of Santa Cruz's legislative assembly, which is the equivalent of a local parliament. 

"What we are doing is simply complying with the mandate of our people in Santa Cruz who voted for the autonomy of our region."

Crucial revenues

Protests over oil revenues for pensions sparked violence earlier this year [AFP]

Another issue is the oil and gas revenues which are now used by the government to finance social programmes for the majority of impoverished Bolivians, who are mainly indigenous. 

The four regions, often called the "half-moon" in reference to their shape on the Bolivian map, contain 85 per cent of the country's oil and gas reserves.

Since Morales nationalised the energy sector in May 2006, revenues went up from $1 billion a year to more than $2 billion.

Opposition leaders disagree with the government's use of a part of the revenues to finance a monthly pension for senior citizens, launched in February 2008, which costs the government $200 million a year. 

"For some it may sound like nothing but 200 bolivianos (US$30) a month is enough for me to survive", says 67-year-old Flora, who spends her days selling chewing gum and candy on the street in La Paz's central Plaza Morillo.

"Morales is my saviour. May God protect him from evil powers."

US interference

Venezuela's Hugo Chavez is one of Morales' biggest allies [AFP]

"I have no doubt that the plan of the empire [US] is to establish a stronghold in Santa Cruz, so Santa Cruz would be in South America what Israel is in the Middle East," says Oswaldo Peredo, a doctor in Santa Cruz and currently a member of a pro-Morales municipal council in the region. 

"It is the same scenario used in Iraq and in Venezuela. They brought someone who has a lot of experience in the issue of separatism: Philip Goldberg. He handled the separation of Kosovo."

Goldberg, the US ambassador to Bolivia, was declared "persona non grata" by Morales, and asked to leave the country in a step that surprised the whole world.

The move was followed by Hugo Chavez, the Venezuelan president, doing the same with the US ambassador to Caracas, Patrick Duddy.
 
Opposition leaders deny any US-backed plans to topple Morales, but admit that Goldberg had regular meetings with some of them, especially in Santa Cruz.

Forging ahead

For now, opposition leaders are acting alone.

The talks represent a golden opportunity for them to be heard and recognised as political players in Bolivia, thanks to the presence of international facilitators from the European Union, the Union of South American Nations (Unasur), the Organisation of American States (OAS) and others.

At the same time it is also an opportunity for Morales to tell the world that he is a democratic leader, who listens and negotiates.

Having won 67 per cent of the vote in August's referendum on his presidency, Morales now also has an unprecedented, unanimous backing from South American leaders.

Even US allies Colombia and Peru have reiterated that they stood by Bolivian democracy and stability in the on-going political crisis. 

There could not be a better time for the socialist and first indigenous president of one of the Latin America's poorest nations, to push ahead with his most important project: A new constitution, which is to give the majority of indigenous people rights they have never had since the foundation of the Republic of Bolivia.