Bolivia's president has suspended the work of agents from the US Drug Enforcement Administration (DEA), accusing them of spying inside Bolivia.

Speaking in the coca-producing region of Chimore in central Chapare province on Saturday, Evo Morales said the US agency had supported the opposition and encouraged political violence that left 19 people dead.

"From today all the activities of the US DEA are suspended indefinitely," Morales said.

"There were DEA agents that were doing political espionage ... financing criminal groups so that they could act against authorities, even the president."

He also directly accused DEA officials of disrupting government activities during the unrest in five of the country's nine departments in September by "funding civic leaders with the aim of sabotaging airports in eastern Bolivia ... to  prevent visits from officials".

Ambassador expelled

Relations with the United States have been tense since La Paz expelled the US ambassador in September after accusing him of encouraging divisions by offering support opposition figures.

September's crisis developed after the Bolivian president announced plans to hold a referendum on a new constitution. 

The United States, which last month added Bolivia to a list of nations that had "failed demonstrably" to meet their obligations in tackling drug trafficking, dismissed the claims against the DEA.

"We reject accusations that the DEA or any other US government agency has supported the opposition or conspired against the Bolivian government," the US embassy in La Paz cited a state department official as saying.

"These accusations are false and absurd.

"If co-operation with the United States is suspended, more drugs will be produced in Bolivia," it added. "The resulting effects of corruption, violence and tragedy will mainly hurt Bolivia itself."

Cocaine producer

Bolivia is the world's third-largest cocaine producer after Colombia and Peru.

Washington says the amount of land being used to cultivate coca in Bolivia has increased significantly, but the United Nations estimates it rose only five per cent last year.

Morales was the leader of the Bolivian coca-growers union before becoming the country's first indigenous president. The coca plant, from which cocaine is derived, has many uses in traditional Andean culture.

Bolivian police, working with DEA agents, have dramatically increased their cocaine seizures under Morales.