Bolivian President Evo Morales seizes assets from Spanish energy company Red Electrica

Bolivian President Evo Morales ordered his military to seize the local assets of Spanish energy company Red Electrica, in the latest example of muscle-flexing by a South American leader.

Evo Morales's move could further spook European investors already wary of resource nationalism in left-wing regimes in South America Photo: Reuters

By Emily Gosden
8:56PM BST 01 May 2012

UK Telegraph:

Mr Morales said the expropriation of Transportadora de Electricidad (TDE), which runs most of Bolivia's power grid, was "in honour of all Bolivian people who have struggled to recuperate our natural resources and basic services". He timed the seizure for May Day.

TDE is 99.94pc owned by Spain's Red Electrica and, according to El Pais, accounts for about 1.5pc of the company's business. Accusing Red Electrica of underinvestment in TDE, Mr Morales said: "We do this... for the benefit of the Bolivian people."

The nationalisation comes just two weeks after Argentine President Cristina de Kirchner announced the expropriation of Spanish company Repsol's stake in oil group YPF, also citing underinvestment.

Mr Morales's move could further spook European investors already wary of resource nationalism in left-wing regimes in South America.

He has past form in such May Day seizures. Two years ago he nationalised four power companies including Rurelec, an Aim-listed British company. Rurelec is still attempting to gain compensation for the assets and is pursuing a $142.3m (£87.7m) claim against Bolivia in the Hague.