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Bolivia nationalises electric grid

Bolivian president Evo Morales has announced that his government is completing the nationalisation of the country's electricity sector by seizing control of its main power grid from a Spanish-owned company.

Mr Morales took advantage of the symbolism of May Day, the international day of the worker, to order troops to occupy installations of the company, a subsidiary of Red Electrica Corporacion SA.

The president's placing of another of what he deems basic services under state control comes as neighbouring Argentina moves to take control of the country's oil company, YPF, from the Spanish energy company Repsol SA, which had held a majority interest.

Spain's ambassador to Bolivia, Ramon Santos, told reporters the electric grid takeover "is sending a negative message that generates distrust".

Red Electrica is the sole operator of the transmission grid in Spain, and the Spanish government holds a 20% stake in the company.

Mr Morales did not say how much the company would be compensated, but the nationalisation decree says the state would negotiate an indemnisation fee.

Mr Morales said only 81 million US dollars had been invested in Bolivia's power grid since it was privatised in 1997.

The government, meanwhile, "invested 220 million US dollars in generation and others profited. For that reason, brothers and sisters, we have decided to nationalise electricity transmission," he said.

Bolivian soldiers peacefully took over the company's offices in the central city of Cochabamba, hanging Bolivia's flag across its entry. The company owned 74% of Bolivia's electrical transmission network, or 1,720 miles of high voltage lines.

Two years ago, on May Day, Mr Morales' government took control of most of Bolivia's electrical generation, nationalising its main hydroelectric plants. Mr Morales, Bolivia's first indigenous president, has moved to put energy, water and telecommunications under state control.

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