By CLIFFORD KRAUSS

          LA PAZ, Bolivia -- When Hugo Banzer was democratically elected president in 1997, two
          decades after his military dictatorship, most Bolivians seemed more interested in economic
          issues than in past human-rights abuses.

          The disappearance of 200 Bolivians during Banzer's rule from 1971 to 1978 was only a minor issue
          in the election campaign, by which time the former general had largely succeeded in polishing his
          reputation.

          But then last October another former dictator, Gen. Augusto Pinochet of neighboring Chile, was
          arrested in London on a Spanish judge's charge that he had led an effort to kidnap and kill leftists in
          five South American countries in the 1970s, and Banzer's fortunes began to change.

          Demonstrators quickly massed outside the Spanish Embassy in La Paz carrying signs that said
          "Banzer to trial." Now he is being besieged by allegations from local human-rights groups, the press
          and even senior congressional members of his ruling coalition that he knowingly participated in joint
          operations with the Chilean and Argentine military governments -- as part of a larger regional effort
          called Operation Condor -- that led to the deaths of at least 36 people.

          Past repression has not incited the same heated debate in this Andean nation of 8 million people as in
          Chile and Argentina, in large part because the scale of the human-rights abuses was far smaller. But
          the charges and bad publicity are particularly distracting and embarrassing for Banzer since they
          come at a time when he is seeking to attract foreign investment and aid to bolster one of South
          America's weakest economies.

          One leftist political party participating in Banzer's government is going through a wrenching internal
          debate about whether to supply the Spanish judge investigating Pinochet with evidence of Bolivian
          involvement in Operation Condor that could eventually lead to Banzer's indictment in Spain.

          Banzer has repeatedly denied knowledge of Operation Condor, and no firm evidence has yet been
          made public that links him directly to any disappearances. But already the allegations that his
          previous government coordinated operations with Pinochet have jeopardized vital economic aid from
          Holland, Belgium and Denmark.

          Meanwhile, Banzer's efforts in recent weeks to silence criticism of his past performance as a
          dictator, both in the local media and on the floor of the lower house of Congress, have opened
          questions about his commitment to open government and democratic reform.

          "President Banzer's inability to accept criticism for his past has reopened a wound," said Carlos
          Toranzo Roca, a leading Bolivian political scientist and economist. "It's not as painful a wound as
          Chile's, but the entire episode is generating complications for Banzer's government."

          Judge Baltasar Garzon, the Spanish judge trying to extradite Pinochet from Great Britain, where he is
          now being held, has gathered evidence linking Banzer's first government to the kidnapping of seven
          Bolivians -- three student leaders, a mining-union organizer and three guerrillas -- who were
          transferred to Chile for execution.

          The Pinochet government was apparently interested in interrogating the seven Bolivians because they
          previously had close ties to members of the socialist government of President Salvador Allende,
          which was overthrown in a 1973 coup.

          Local human-rights activists and the head of the Bolivian Chamber of Deputies' human-rights
          commission say a total of six Argentines were picked up by Bolivian security forces here and
          transferred to Argentina for execution. Meanwhile, they say a total of 23 Bolivians disappeared while
          they were living in exile in Argentina.

          Operation Condor was organized by the Chilean secret intelligence service primarily to hunt down
          Chilean political exiles living in neighboring countries. According to Garzon, the military regimes of
          Argentina, Brazil, Uruguay, Paraguay and Bolivia participated in the operation to eliminate their own
          leftist activists, especially those living in exile.

          After he was overthrown in a military coup in 1978, Banzer shed his uniform and dedicated himself
          to organizing a moderately conservative party. The abuses during the first Banzer government were
          largely forgotten by 1981 because of the repression of a much harsher military regime that followed,
          led by Gen. Luis Garcia Meza, who was strongly influenced by cocaine traffickers as well as Klaus
          Barbie, a Nazi exile known as the Butcher of Lyons.

          In the 1985 presidential elections, Banzer won a narrow plurality of the vote but was prevented from
          taking office by the Congress. Rather than take the advice of party hard-liners who pushed for a
          coup, Banzer accepted the results.

          Since the 1997 election, the Banzer government has won strong applause from the Clinton
          administration and U.N. officials for starting an aggressive coca eradication campaign. But for all of
          his effort to reform his image, the old ghosts are beginning to return.

          After Pinochet's arrest, La Prensa, a Bolivian daily newspaper, began publishing a series of articles
          about Bolivia's role in Operation Condor. Allies of Banzer quietly threatened to cut off government
          advertising in the newspaper. Three reporters considered unfriendly to the government were then
          dismissed, and the paper's aggressive coverage stopped.

          The Bolivian Chamber of Deputies overwhelmingly approved a resolution Nov. 25 asking its
          human-rights panel to assemble evidence on Bolivian involvement in Operation Condor and then
          hand it over to Garzon. But after the commission came up with its evidence, senior government
          officials lobbied hard against any congressional transfer of documents to the Spanish judge.

          The Chamber of Deputies reversed itself in a resolution Feb. 23. It added, however, that the
          Revolutionary Leftist Movement, or MIR, a government-aligned party that pushed for the original
          congressional resolution, could offer Garzon the documentation.

          The party executive committee is now debating the issue, with members in its left wing arguing that
          they cannot forget that three of the seven Bolivians killed in Chile were members of the party. That
          some current Banzer allies are seeking justice for dissidents who opposed the first Banzer
          government shows how much politics has changed here over the last three decades.

          Nevertheless, Hugo Carvajal, president of the Chamber of Deputies, warned in an interview that if
          the government put strong pressure on his party not to send the documents to Spain "it will generate
          friction in the governing coalition." Carvajal, who himself was arrested and tortured as a student
          leader in the 1970s, added, "Historical memory is important, and this is a matter of dignity, so I
          won't keep quiet."

          Recently, Informe R, a monthly magazine, published an entire issue on Operation Condor that
          featured a collage cover showing Pinochet with a portrait of Banzer in full military uniform hung on a
          wall over his shoulder.

          Editors of the magazine accused Interior Ministry agents of trying to break into their offices to
          confiscate 1,000 issues before they were delivered to newsstands, a charge the government denies.

          Interior Minister Guido Nayar Prado threatened to take the magazine to court for defaming the
          president with a cover he characterized as a fake. Embarrassed by the wide press coverage that
          followed, Banzer told his minister to drop his threat.

          In an interview, Nayar Prado said, "They put the pictures of the two presidents together to fool
          readers into thinking that Banzer and Pinochet were the same, which is a lie."