Highlights: Bolivia's greenback reserves have plunged from 15 billion dollars ten years ago to less than 2 billion dollars today. Total dollar reserves have halved over the past year, and the amount of liquidity is now less than $200 million, according to the most recent data. End of export quotas and fuel subsidies is one of the emergency measures announced by the Minister of the Economy. The State will also subsidize the purchase of fuel for the productive sectors which consume it the most. The measures were welcomed by different economic sectors.

In Bolivia, the demand for dollars is ever stronger, and central bank reserves ever lower. In this context, the government and representatives of the business sector…

Bolivia: an agreement reached between the government and employers on the shortage of dollars

In Bolivia, the demand for dollars is ever stronger, and central bank reserves ever lower. In this context, the government and representatives of the business sector signed an agreement containing ten measures to end the shortage of dollars and avoid the start of an economic crisis.

Bolivians pass by a currency exchange office in La Paz on February 19, 2024. © CLAUDIA MORALES / Reuters

By: RFI Follow

In Bolivia

, President Luis Arce and his ministers have been trying for months to reassure the population by explaining that there is no economic crisis in the country. However, the agreement that has just been signed with company representatives seems to say quite the opposite, reports our correspondent in La Paz,

Nils Sabin

In recent days, several companies importing machines and even medicines have

increased their prices due to lack of dollars

. “

Urgent steps must be taken to normalize dollar operations in the short term. The sector is ready to help with suggestions, proposals and alerts

,” assured the president of the confederation of private entrepreneurs at the end of last week.

End of export quotas and fuel subsidies

The latter seems to have been listened to by the Minister of the Economy, who announced

ten emergency measures

. The most important being the end of export quotas, which should facilitate the sale of soya, rice and even meat abroad. The State will also subsidize the purchase of fuel for the productive sectors which consume it the most.

“

The largest industrial buyers of fuel are the agro-export sector, construction, mining and transport. The idea is that the public company that imports the fuel sells it

at a reduced price
to these sectors

,” explained Marcelo Montenegro, the Minister of the Economy. The latter also indicated that the government intended to raise up to five billion dollars through the agricultural and mining sectors.

Dollar reserves halved in one year

The measures were welcomed by different economic sectors, which hope for a return to normal in the coming weeks. The observation is glaring: Bolivia's greenback reserves have plunged from 15 billion dollars ten years ago to less than 2 billion dollars today. They have been largely undermined by declining production and exports of natural gas, a mainstay of the country's economy over the past two decades.

Total dollar reserves have halved over the past year, and the amount of liquidity is now less than $200 million, according to the most recent data.

For

truckers on strike

in La Paz, this drastic drop in stocks mainly delays payments. “

The losses are in the millions

,” Ramiro Barrero, leader of the truckers’ union, told Reuters. “

We haven’t been paid for months.

(

And with

agencies)

Also read: The lack of dollars highlights the limits of the Bolivian “economic miracle”

Bolivia: an agreement reached between the government and employers on the shortage of dollars

Bolivia: an agreement reached between the government and employers on the shortage of dollars

End of export quotas and fuel subsidies

Dollar reserves halved in one year

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