Bolivia's economy on edge as ruling party tensions intensify

Supporters of Bolivia’s former president Evo Morales are increasing pressure in the streets and in congress, delaying votes on multilateral energy and infrastructure loans involving over US$800mn.

Morales supporters have been blocking highways for days, especially in Cochabamba department, in protest of term extensions for judges who ruled in December that the former president can’t run in next year’s general elections.

Interior minister Eduardo del Castillo claimed Morales seeks to force an early election.

“He will keep trying to destabilize any government as long as he isn’t president,” Del Castillo was quoted as saying by state news agency ABI.

The trade and transport sectors condemned the protests, with some organizations even considering their own counter-measures to deal with blockades.

“We can’t tolerate more,” Lucio Gómez, head of the drivers confederation, said during a press conference. Gómez didn’t rule out drivers breaking the blockades. 

The Luis Arce administration calculated that the protests are causing daily losses of US$128mn.

Widespread blockades last year are being blamed for having caused lackluster economic performance.

LEGISLATIVE BLOCKADE

Morales allies in congress, together with the right-wing opposition, are delaying votes on eight multilateral loans, development planning minister Sergio Cusicanqui said in a statement.

Among the latest affected is a US$43mn contract approved by the Inter-American Development Bank (IDB) to modernize Sucre’s historical center, the ministry said in a press release.

In total, lawmakers are blocking loans worth US$821mn.

In the lower house, votes are pending for:

– a US$200mn IDB loan for a rural electrification program;

– a US$176mn CAF loan for Caracollo-Confital highway widening, Confital-Bombeo section;

– a US$125mn BIRF loan for sustainable electricity access;

– a 15bn-yen (US$102mn) JICA loan for the COVID-19 response program;

– a US$62mn IDB loan to expand La Paz’s cable car system;

– a US$57.2mn FONPLATA loan for widening the La Paz-Oruro highway, Senkata-Apacheta stretch;

– a US$56mn FONPLATA loan to pave 62km of route 725 in Santa Cruz department.

Tension between Morales and Arce supporters within the ruling MAS party also prevented a vote on the 2024 budget, but the government passed it without legislative approval on January 1 thanks to a constitutional rule.