December 7, 2009 / 3:38 PM / in 9 years

Bolivia's Morales says will deepen leftist reform

LA PAZ (Reuters) - Bolivian President Evo Morales said Monday he would deepen reforms focussed on Indian power and state control of the economy after exit polls showed he was re-elected in a landslide Sunday.

Official results were not expected until later Monday but quick counts showed Morales took at least 63 percent of the vote, more than 35 percentage points ahead of his closest challenger, rightist former Governor Manfred Reyes Villa.

Morales’ Movement Towards Socialism party also won absolute control of Congress with more than two-thirds of the seats in the lower house and the Senate, exit polls showed.

That leaves his divided conservative opposition with little power to oppose his reforms during his five-year second term.

Morales, an Aymara Indian, is Bolivia’s first indigenous president and is hugely popular among the Indian majority that also supported a constitutional reform earlier this year to allow him to run for a second consecutive term in South America’s poorest country.

“Bolivians have given us an enormous responsibility to deepen this transformation,” he said at a news conference. “Bolivians have punished the people who are traitors of this process.”

Critics say Morales, 50, has scared away crucial foreign investment with nationalizations of key sectors of the economy and is ruling only for Indian ethnic groups instead of all Bolivians.

Morales has given Indian communities more authority over investment in natural resources in their territories and his new constitution enshrines traditional religions and practices.

With two-thirds of Congress the ruling party can call for public votes to amend the constitution, if they so wish, and will control judicial appointments as well.

However, analysts said Morales may moderate his rhetoric in order to attract foreign investment so he can move forward with ambitious state business projects.

Morales has pledged to launch state-run paper, cement, dairy and drug companies and develop iron and lithium industries to help Bolivia export value-added products instead of raw materials.

CASH PAYMENTS

Many voters were won over by government cash payments to school children, mothers and pensioners, which reached a quarter of Bolivia’s 10 million people this year.

“I’m a teacher and I see that the kids go to school with hope, because they get breakfast there and the subsidies ... I ask them how they spend the hand-outs and some of them say they buy shoes. Some didn’t have shoes before,” said Irene Paz, 36, after voting in El Alto, a poor suburb of La Paz.

Morales is an ally of Venezuela’s socialist President Hugo Chavez and ramped up social spending in his first term, tapping increased government revenue after he nationalized the energy industry in 2006 and raised taxes on natural gas production. Bolivia is South America’s top exporter of the fuel.

But opponents say he has failed to increase output, stamp out corruption in the state-run energy company and develop the natural gas industry, signs of future challenges.

Morales’ leading opponent, Reyes Villa, said Sunday night he was waiting for official results to be released before making any statements, but the third-place contender, cement magnate Samuel Doria Medina, conceded defeat as exit polls showed him taking 6 percent of the vote.

Additional reporting by Carlos Quiroga, Silene Ramirez and Diego Ore; Editing by Eric Beech

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