Economy Overview
Bolivia, long one of the poorest and least developed Latin American countries, reformed its economy after suffering a disastrous economic crisis in the early 1980s. The reforms spurred real GDP growth, which averaged 4% in the 1990s, and poverty rates fell. Economic growth, however, lagged again beginning in 1999 because of a global slowdown and homegrown factors such as political turmoil, civil unrest, and soaring fiscal deficits, all of which hurt investor confidence. In 2003, violent protests against the pro-foreign investment economic policies of ex-President SANCHEZ DE LOZADA led to his resignation and the cancellation of plans to export Bolivia's newly discovered natural gas reserves to large northern hemisphere markets. In 2005, the government passed a controversial natural gas law that imposed significantly higher taxes on the oil and gas firms and required production firms to sign new operating contracts, which were completed in October 2006. Bolivian officials are in the process of revamping the defunct state-owned oil company and acquiring majority ownership of five gas production, transportation, refining, and storage companies. The MORALES administration plans to increase state control over other sectors as well, including mining, electricity, telecommunications, transportation, and forestry. Real GDP growth in 2003-06 - helped by increased demand for natural gas in neighboring Brazil - was positive, but still below the levels seen during the 1990s. Bolivia's fiscal position has improved in recent years, and the country had a record 6% fiscal surplus for 2006. In 2005, the G8 announced a $2 billion debt-forgiveness plan over the next few decades. The International Monetary Fund and the World Bank forgave a total of approximately $1.8 billion of Bolivian debt in 2006 that has helped reduce fiscal pressures on the government.
Agriculture Products
soybeans, coffee, coca, cotton, corn, sugarcane, rice, potatoes; timber
Industries
mining, smelting, petroleum, food and beverages, tobacco, handicrafts, clothing
Industrial Production Growth Rate
5.7% (2004 est.)
Labor Force
4.297 million (2006 est.)
Electricity production
5.041 billion kWh (2005)
Electricity Consumption
4.207 billion kWh (2005)
Electricity Exports
0 kWh (2005)
Electricity Imports
0 kWh (2005)
Unemployment Rate
7.8% in urban areas; widespread underemployment (2006 est.)
Population Below Poverty Line
64% (2004 est.)
Household Income or Consumption by Percentage Share
Lowest 10%: 0.3%
Highest 10%: 47.2% (2002)
Distribution of Family Income Gini Index
60.1 (2002)
Budget
Revenues: $4.48 billion
Expenditures: $3.95 billion (2006 est.)
Commercial Bank Prime Lending Rate
Market Value of Publicly Traded Shares
$2.2 billion (2005)
Reserves of Foreign Exchange and Gold
$3.194 billion (2006 est.)
Debt External
$4.455 billion (2006 est.)
Stock of Direct Foreign Investment at Home
$NA
Stock of Direct Foreign Investment Abroad
$NA
Exchange Rates
bolivianos per US dollar - 8.0159 (2006), 8.0661 (2005), 7.9363 (2004), 7.6592 (2003), 7.17 (2002)
