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President Arce and his Plan for Bolivia’s Development

President Arce
On September 21, 2022, the President of Bolivia, Arce Catacora, gave a lecture at Yale University before participating in the United Nations General Assembly meeting in New York. Speaking to a small room of students and faculty, President Arce presented macroeconomic data from Bolivia’s last 20 years, noting successes during the 15-year reign of his political party, Movimento al Socialismo (MAS). Throughout his lecture, he emphasized a focus on resource extraction as the primary engine behind the country’s short and long-term growth.

About President Arce

President Arce began in a celebratory tone, comparing the successes of MAS’ socialist model compared to the “neoliberalist model” which existed before it. He noted that between 2006 and 2019, the years in which his party held power, GDP per capita grew by 4.7% compared to 3% from 1985 to 2005. He also spoke about Bolivia’s success in distributing those gains fairly, raising the income of the bottom 40% by 12.5% and adopting what he labeled a “democratization of the economy.”

Additionally, he stressed Bolivia’s financial stability, pointing out the country’s low levels of external debt. Drawing from data collected by the central bank, President Arce drew the crowd’s attention to the external public debt prior to the presidency of MAS’ Evo Morales, which reached a historic high of 63% of GDP in 2003. He then noted that after 2006, Bolivia’s external debt never rose above 33%, sitting at 28.9% of GDP under his administration.

Responding to critics of his “economic social communitarian productive model” he highlighted the continual growth of businesses in Bolivia as a sign of sustainable development. Beginning in 2005, Bolivia saw more than 250,000 companies originate over the course of 14 years, with smaller growth during the pandemic years. Going out of his way to address concerns over private investment under the socialist model, he claimed Bolivia had found a viable way to mix state involvement in the economy with entrepreneurship.

Bolivia’s Challenges

Although Arce’s presentation portrayed the last 20 years in an overwhelmingly positive tone, it omitted many of the challenges that Bolivia faces. Although his model is based upon natural resource extraction, with Bolivia’s primary resource being natural gas, this cannot keep up with the rate of growth of the Bolivian economy. In fact, Bolivia has already become a net importer of hydrocarbons, at a time when energy prices are at historic highs.

The Environment

In addition, Bolivia grapples with numerous environmental issues, including poor management of its portion of the Amazon rainforest. President Arce announced in July 2022 that he would be investing in palm oil to increase the country’s energy output, something that is both inefficient and environmentally harmful. Furthermore, Arce’s administration did little to quell the massive fires in Bolivia’s Chiquitania region, and his political predecessor Evo Morales actually signed a decree in 2019 making it easier for agribusiness to exploit the land. This is a far cry from his speech at Yale, in which he promised to “respect mother earth” after a question from a faculty member.

Human Rights Issues

Finally, and perhaps most importantly, Bolivia’s questionable actions regarding human rights within Bolivia and South America threaten to sour any notions of success. During the questions which followed the presentation, President Arce was asked how Bolivia could claim to support human rights while remaining on friendly terms with Venezuelan president Nicolas Maduro, even amidst human rights abuses. His answer, vague and evasive, did little to conceal the fact that Bolivia continues to have close ties with Venezuela, even choosing to opt out of a regional conference if Venezuela did not receive permission to attend.

The Justice System

Even within Bolivia, others have accused Arce and his party of tampering with the justice system for political gain. In June 2022 former interim president Jeanine Anez received a 10-year sentence in prison for plotting a coup, despite her rise to Bolivia’s supreme court upholding the president. Prosecutors claim she was part of a plan to remove President Evo Morales from office in 2019, despite the fact that she did not participate in the largely peaceful protests which led to his resignation. Anez claims her imprisonment is a purely political affair, designed to legitimize MAS after its fall from power after allegedly committing fraud to win the 2019 presidential election.

Looking Ahead

President Arce’s economic model has proven that it can succeed, and his presentation is a testament to the fact that Bolivia’s growth under nearly 20 years of MAS rule has been truly unprecedented. However, it does not take away from Bolivia’s murky future, and dubious record with human rights. The country has the economic potential to develop strongly, but strong political and environmental protections still remain uncertain.

– Samuel Bowles
Photo: Flickr

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Fragility and the Rule of Law in Bolivia

Rule of Law in Bolivia
Protests in Santa Cruz de la Sierra, Bolivia, threaten to hamper an already struggling economy. A city-wide shutdown occurred on August 8, 2022, over the government’s decision to postpone the 2022 decennial census until 2024. On one hand, Santa Cruz’s legislators believe that delaying the census is an attempt to deny the municipality more political representation as its population has ballooned in the previous three decades. Santa Cruz’s leadership in the battle for the census reinforces the city’s trend of opposition toward the ruling government (Movimiento al Socialismo), but also its power as the economic center of Bolivia.

By strongly opposing itself to the rule of Movimiento al Socialismo, Santa Cruz’s situation shows the fragility of the rule of law in Bolivia. The United Nations highlights that rule of law plays an integral role in the development of countries and the reduction of poverty as poverty often arises from “disempowerment, exclusion and discrimination.” The rule of law upholds the voices of the people, safeguards democracy and ensures the protection of human rights.

A History of Protests

Santa Cruz’s governor Luis Camacho announced that the capital of the municipality could freeze for 48 hours starting August 8 until President Luis Arce agreed to discuss an earlier census date. As the largest city in Bolivia and its economic center, estimates indicate that each day of the shutdown will equate to an economic loss of $33 million, leading to accusations of crippling the economy for political gain. Alongside the economic problems caused by the protest, there have been reports of violence from those in favor and against the shutdown, with mayor Jhonny Fernández’s home coming under attack.

This is not a temporary issue either. Santa Cruz has undergone numerous shutdowns in previous years, dating all the way back to the nationwide shutdown in 2019 over ex-President Evo Morales’ alleged fraudulent election victory. As recently as July 2022, protestors spoke out against Movimiento al Socialismo’s imprisonment of many opposition members. Among the imprisoned is former President Jeanine Añez whose interim presidency was upheld by the Bolivian Constitutional Court prior to her condemnation.

Hope for Resolution

Although these incidents point to the fragility of the rule of law in Bolivia, there is strong hope for a resolution to the conflict. President Arce agreed to revisit the 2023 census’ date with delegates from Santa Cruz, an important step toward reconciliation between Movimiento al Socialismo and Santa Cruz’s opposition government. Another promising feature of the shutdown is that despite sporadic violence, both the central government and Santa Cruz’s mayor have called for a peaceful resolution with dialogue from all sides.

Additionally, foreign nonprofits, governments and organizations form an active part of the efforts to strengthen Bolivia’s fragile political situation. In 2019, the Organization of American States and the European Union reviewed Bolivia’s election results, reporting possible instances of electoral fraud. In 2020, with oversight once again, Bolivia held an election with a fair democratic process in place.

To safeguard democracy and the rule of law, the International Republican Institute works to strengthen “democracy and freedom” and “guide politicians to be responsive to citizens” while “[motivating] people to engage in the political process.” In Bolivia specifically, the IRI aims to “support free and fair elections, democratic institutions and local government, civil society capacity building, and efforts to promote peacebuilding and reconciliation.”

Looking Ahead

In the Declaration of the High-level Meeting on the Rule of Law, states stressed that “the rule of law at the national and international levels is essential for sustained and inclusive economic growth, sustainable development, the eradication of poverty and hunger and the full realization of all human rights and fundamental freedoms, including the right to development, all of which in turn reinforce the rule of law.”

Ultimately, fragility remains a key issue for the rule of law in Bolivia, but both local and federal governments are showing a desire to prevent violence and enforce institutional authority. The rejections of violence by Governor Camacho and President Arce indicate that although there are differences between the states and the Bolivian government, there is also a willingness to bring issues like the census to an amicable resolution to strengthen the rule of law in Bolivia.

– Samuel Bowles
Photo: Flickr

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Bolivia Raises Minimum Wage

Bolivia_Raises_Minimum_Wage
Following recent labor union protests in Bolivia, demanding an increase in the minimum wage, President Evo Morales has acquiesced to their demands by increasing the Bolivian minimum wage 20 percent from 1,200 Bolivianos (around $175) to 1,488 Bolivianos (about $215). This increase in the minimum wage has come as a result of a small but concerted effort on behalf of the Bolivian Central Labor Union to agitate for change. Workers were concerned that their wages were not keeping up with inflation, which is currently sitting at 6.5 percent.

Morales explained the reason for the increase in the minimum wage is the economic growth Bolivia has experienced recently, which grew at a rate of 5.2 percent in 2012.

The leader of the Bolivian Central Labor Union, Juan Carlos Trujillo, stated that he asked Morales to recognize “the need and the obligation to create a salary structure which is based on the country’s growth and the recognition that the riches of Bolivia have to be shared between the haves and the have-nots in equal measure.”

Other groups were not so pleased with the announced rise in the minimum wage, saying that the move would simply result in workers paying more through taxes. Moreover, the move can also be seen as political maneuvering and as an attempt to curry favor amongst the workers in time for presidential elections in October, when Morales is going to run for a third term.

The original proposal by the government was for the minimum wage to be increased by 10 percent, until trade unions negotiated a higher rise. Analysts have noted that the increase in the minimum wage would not affect the majority of workers since most people earn above 1,400 Bolivianos (about $203.) The rise would affect house workers and trash men.

Morales himself was a notable leader in the cocalero trade union movement for indigenous coca growers prior to being elected president. Since being elected president in 2006, Morales has helped triple Bolivia’s gross domestic product to $27 billion.

– Jeff Meyer

Sources: La Razon, BBC, Bolivia Information Forum
Photo: Nation of Change

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Financial Reform Law in Bolivia

Financial Reform Law in Bolivia
Last August, Bolivian President Evo Morales signed a bill that would reform the country’s financial sector. The reform bill has more than 550 articles and is expected to force the private sector banks in the country to become more competitive as interest rate ceilings and mandatory-lending quotas are implemented. The law will boost the competitiveness of state-owned bank Banco Unión and the many microfinance institutions operating in the region.

The reform is also intended to focus on financial inclusion and reducing economic inequality, an issue that is extremely important for Morales and his large indigenous following. The private banks in the region will need to become more efficient as well, but fortunately for the banks the Bolivian government has been implementing the changes gradually. It is unknown how much the reform will cut into the bank’s profitability.

During the last few years, however, Bolivia has enacted harsh taxes designed to reduce its “excess” profitability. The private banks’ average return on equity fell from 21% in 2007 to 17.5% in 2012, then to 14% in 2013. This latest dip came from the imposition of additional taxes on extraordinary earnings and a tax on exchanges related to foreign exchange.

The law also states that at least 60% of a bank’s loan portfolio should go to financing the productive and social sectors. This will be difficult for Bolivia’s banks, however, as they are currently focused on specific markets. Despite this new requirement, the government is giving the banks a period of two years to four years to implement it.

Another requirement states that the interest rate ceiling on loans for houses to be set at 5.5 to 6.5%, a figure that depends on the value of the house. Banks currently set the loan ceiling to a figure of 7 to 8%. This loan ceiling is designed to allow more people to be able to better afford a house and is a part of the movement towards more financial inclusion in Bolivia.

Bolivia’s private banks should be able to weather this new reform with continued profitability as the Bolivian economy is buoyed by its 6.5% growth rate in 2013 and its credit growth of 20%.

– Jeff Meyer

Sources: BNamericas, BNamericas, laRazon
Photo: The Telegraph

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Bolivia: Advocacy Against Child Labor

Bolivia_Child_Labor
Human Rights Watch (HRW) has recently emphasized that the Bolivian government should reject proposals to lower its minimum age of employment below 14 years old. President Evo Morales has expressed support for proposals to abolish a minimum age for “independent work” and to lower the minimum age to 12 years old for all other jobs.

Jo Becker, children’s rights advocacy director at Human Rights Watch (HRW,) stated that, “Child labor perpetuates the cycle of poverty. Lowering minimum age of employment is counterproductive and out of step with the rest of the world.”

Reductions in child labor are attributed to increasing access to education, strengthening national legislation and monitoring and bolstering social protection plans such as Bolivia’s Juancito Pinto cash transfer program.

The International Labor Convention stipulates a minimum employment age of 15 years old. Bolivia, along with 166 other countries, is a part of this. The only stipulation is countries whose economy and educational facilities are insufficiently developed may under certain conditions have a minimum age of 14 years old. Bolivia has a reported 850,000 child laborers.

“Poor families often send their children to work out of desperation, but these children miss out on schooling and are more likely to end up in a lifetime of low-wage work,” Becker said. “The Bolivian government should invest in policies and programs to end child labor, not support it.”

Human rights across Latin America are struggling with a seemingly intractable dilemma, according to The Guardian. Countries such as Bolivia, Colombia, Argentina, Ecuador and Brazil hope to benefit from the commodity boom in global markets that are fueled by demand in China and other areas of the world.

Social movements across Latin America are helping to remold politics and political discourse. These countries democratization depend on the support of increasingly active social movements in both rural and urban areas.

Along with the protesting and movements transpiring in Latin America, HRW joined the Global March against Child Labor and Anti-Slavery International on January 24. The group sent a letter to Morales completely opposing any sort of movement to lower the minimum age of employment. HRW explained that it would be extremely counterproductive to the Bolivian economy.

– Lindsey Lerner

Sources: Human Rights Watch, The Guardian
Photo: Bicultural Mom

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Bolivia Announces Nuclear Energy Program

Bolivia
Bolivian President Evo Morales has announced the first steps towards building the first nuclear reactor in the country during his annual state of the union address to the Bolivian Congress. Morales stressed that the nuclear program will be developed for peaceful purposes with the help of France, Iran and Argentina.

Evo Morales called the nuclear development project a priority for Bolivia and stressed that the South American country “will not remain excluded from this technology, which belongs to all humankind.”

If Bolivia follows through on its claims, it will join the ranks of only three other Latin American nations with functioning nuclear programs. Argentina, Brazil and Mexico have had nuclear programs for peaceful purposes ever since the Treaty of Tlateloco in 1967 established a nuclear-weapon-free zone across Latin America.

Bolivia stated that Iran, France and Argentina had agreed to aid the country in its efforts to establish a nuclear weapons program.

Evo Morales is the first indigenous president of Bolivia and is known as a bombastic critic of the United States and its policies throughout Latin America. He expelled the US Drug Enforcement Agency (DEA) in 2011 and the US Agency for International Development (USAID) in 2013 as an effort to reduce subversive US influence in the country.

Earlier this year, Bolivia became one of the last states in South America to have its own telecommunications satellite when China stepped in to help with the launch of the satellite, named after Tupak Katari, an indigenous folk hero who fought against Spanish colonialism.

The telecommunications satellite will help reduce the cost of communications and improve access to the Internet for many Bolivians living in rural areas. The move is also a further step towards increased independence from the West that President Morales would like to see more of.

In spite of these campaigns, Bolivia is expected to continue on a path of energy diversification by investing in explorations for oil and uranium reserves in Potosí.

– Jeff Meyer

Sources: BBC, Latin Post, BBC, UPI
Photo: Polygrafi

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Footballers Against Sexual Violence

Unite to End Violence Against Women UN Program Evo Morales Bolivia
Last week, Bolivian president Evo Morales and a variety of governmental and UN officials met on the Roosevelt Island Soccer Field in New York City to campaign for the UN-based initiative UNiTE to End Violence Against Women. The campaign, which has high international aims, focuses specifically on Latin America and the Caribbean, two regions with abnormally high instances of gender-based crime.

The match had a diverse group of players, influential both on the football field and in the broader context of development: the Minister of Foreign Affairs of the former Yugoslav Republic of Macedonia, Nicola Poposki, and two female members of parliament from Norway, Karin Andersen and Lene Vågslid. Diplomats from Bosnia and Herzegovina, Brazil, Liechtenstein, Austria, and the U.S. rallied on the other side.

In conversation with the UN, Assistant Secretary-General and UNDP director for Latin America, Heraldo Muñoz, explained: “Football is a global passion and a great way to win hearts and minds, conveying the message that ‘real men don’t hit’.”

The larger program beyond the pitch deals mainly with governmental reform. Too often, cases of gender-based violence are overlooked. Instead, the UN urges governments to lead by example, exhibiting solely intolerance in regards to such violence and oppression. Criminals must be punished in order to protect the women and girls of the world.

UN global statistics reveal the urgency of this situation: globally, around 50 percent of sexual assaults are committed against girls under the age of 16. Furthermore, statistics show that problematic regions must be addressed. Over half of the countries with the highest rates of female murder are within Latin America and the Caribbean. Tellingly, such statistics exhibit the fatal consequences of tolerance.

Secretary-General Ban Ki-moon created the “UNiTE to End Violence Against Women” in 2008. The initiative addresses all governments, demanding the implementation of strict laws, action strategies, and overall, a larger systematic address of sexual violence by 2015.

Ultimately, football serves as a common ground between us all. Yet, so should our women and girls—for their futures are ours.

– Anna Purcell

Sources: United Nations, Global Times
Photo: Flickr

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2013: The International Year of Quinoa

2013: The International Year of QuinoaThe year 2013 has been titled “The International Year of Quinoa” by the United Nations and the Food and Agricultural Organization (FAO) has named Bolivia’s president, Evo Morales, the Special Ambassador for the International Year of Quinoa. So, why is that important?

Quinoa is a semi-cereal, not quite a grain, that is mostly grown in Peru and Bolivia. If you have any “foodie” friends or know any hip cooks, you will probably have heard a lot about quinoa. In fact, the factor of “hipness” may have had a huge part in increasing the popularity of the food, as well as the fact that it has astonishing nutritional value. The UN’s declaration of 2013 being the International Year of Quinoa is part of an effort to further increase the food’s popularity. The real reason that quinoa is being pushed as a popular food is that quinoa is extraordinarily hardy, and is a great source of amino-acids. It is one of the most durable foods on Earth. Quinoa is able to thrive even in semi-arid deserts and the high Altiplano.

Quinoa is now being planted more and more in other harsh climates that span countries like Chad and Niger. While most of the world’s quinoa still comes from Peru and Bolivia, it is gaining ground in other countries. The heightened popularity of the food has increased the average crop value and provided higher income to farmers and local business owners alike. Hopefully, the popular attention that quinoa is receiving will help consumers make the choice to join in and celebrate the International Year of Quinoa.

– Kevin Sullivan

Source: United Nationsl