Bolivia

ECONOMICS


Bolivia is a resource rich country with strong growth attributed to captive markets for natural gas exports – to Brazil and Argentina. However, the country remains one of the least developed countries in Latin America because of state-oriented policies that deter investment.
Following an economic crisis during the early 1980s, reforms in the 1990s spurred private investment, stimulated economic growth, and cut poverty rates. The period 2003-05 was characterized by political instability, racial tensions, and violent protests against plans - subsequently abandoned - to export Bolivia's newly discovered natural gas reserves to large Northern Hemisphere markets. In 2005-06, the government passed hydrocarbon laws that imposed significantly higher royalties and required foreign firms then operating under risk-sharing contracts to surrender all production to the state energy company in exchange for a predetermined service fee; the laws engendered much public debate. High commodity prices between 2010 and 2014 sustained rapid growth and large trade surpluses with GDP growing 6.8% in 2013 and 5.4% in 2014. The global decline in oil prices that began in late 2014 exerted downward pressure on the price Bolivia receives for exported gas and resulted in lower GDP growth rates - 4.9% in 2015 and 4.3% in 2016 - and losses in government revenue as well as fiscal and trade deficits.
A lack of foreign investment in the key sectors of mining and hydrocarbons, along with conflict among social groups, pose challenges for the Bolivian economy. In 2015, President Evo MORALES expanded efforts to court international investment and boost Bolivia’s energy production capacity. MORALES passed an investment law and promised not to nationalize additional industries in an effort to improve the investment climate. In early 2016, the Government of Bolivia approved the 2016-2020 National Economic and Social Development Plan aimed at maintaining growth of 5% and reducing poverty.

 

1990 2000 2010 2016
GNI, Atlas method (current US$) (billions) 4.94 8.29 17.92 33.49
GNI per capita, Atlas method (current US$) 720 990 1,810 3,080
GNI, PPP (current international $) (billions) 15.61 28.38 50.24 77.32
GNI per capita, PPP (current international $) 2,280 3,400 5,070 7,100
Poverty headcount ratio at national poverty lines (% of population) .. 66.4 45.1 39.5
Poverty headcount ratio at $1.90 a day (2011 PPP) (% of population) 7.1 28.6 7.3 7.1
GDP (current US$) (billions) 4.87 8.4 19.65 33.94
GDP growth (annual %) 4.6 2.5 4.1 4.3
Inflation, GDP deflator (annual %) 16.3 5.2 8.8 -1.4
Agriculture, forestry, and fishing, value added (% of GDP) 15 13 10 11
Industry (including construction), value added (% of GDP) 32 26 30 25
Exports of goods and services (% of GDP) 23 18 41 24
Imports of goods and services (% of GDP) 24 27 34 32
Gross capital formation (% of GDP) 13 18 17 21
Revenue, excluding grants (% of GDP) 13.7 17.8 23.3 ..
Net lending (+) / net borrowing (-) (% of GDP) -1.7 -4 1.2 ..
States and markets
Time required to start a business (days) .. 59 49 45
Domestic credit provided by financial sector (% of GDP) 23 62 49.4 76.3
Tax revenue (% of GDP) 7.2 12.3 17 ..
Military expenditure (% of GDP) 2.8 2.1 1.7 1.6
Mobile cellular subscriptions (per 100 people) 0 7 72.4 92.8
Individuals using the Internet (% of population) 0 1.4 22.4 39.7
High-technology exports (% of manufactured exports) 7 40 8 4
Statistical Capacity score (Overall average) .. .. 67 69
Global links
Merchandise trade (% of GDP) 33 36 61 46
Net barter terms of trade index (2000 = 100) 102 100 177 86
External debt stocks, total (DOD, current US$) (millions) 4,370 5,900 5,806 11,015
Total debt service (% of exports of goods, services and primary income) 39.4 39.8 9.5 9.3
Net migration (thousands) -91 -90 -62 -50
Personal remittances, received (current US$) (millions) 5 127 960 1,217
Foreign direct investment, net inflows (BoP, current US$) (millions) 27 736 622 335
Net official development assistance received (current US$) (millions) 545.4 486 717.7 696.5