Page 12 - ARUBA TODAY

A12 WORLD NEWS
Tuesday 2 July 2019
Bolivian economy island of stability but storm clouds loom

By CARLOS VALDEZ a sharp decline in currency
Associated Press reserves, the increase in
LA PAZ, Bolivia (AP) — public debt with still-low in-
Abraham Rodríguez's small ternational prices, and an
shoe store grew into a fac- economy dependent on
tory that employed more commodities, are causing
than a dozen workers dur- "tensions" in Bolivia's eco-
ing an economic boom in nomic policy, said Juan
Bolivia when prices for the Pablo Bohoslavsky, the U.N.
gas and minerals it produc- independent expert on
es soared. foreign debt and human
Today, he can only employ rights.
one worker. He says the "The fixed exchange rate
tax-free import of goods to control inflation leads to
and the black market have an increase in import prices
affected his sales and have and a growing deficit in the
caused him to go into debt. balance of payments," he
"My life was better 10 years said.
ago. There were sales and Bolivia's external debt rose
the shoe store grew," Rodrí- in March to $10 billion, or
guez said in his workshop lo- In this June 4, 2019 photo, women sell coats in downtown La Paz, Bolivia. about 25% of the coun-
cated in La Paz. "Today, the Associated Press try's GDP. But central bank
market has reduced. My president Pablo Ramos
employees left because I challenges, including rising cades. ics and other goods from discarded the possibility of
couldn't afford to pay their debt, shrinking reserves and About 45,000 artisan work- China became more prof- a devaluation of the local
salary." devaluing currencies in its shops in Bolivia closed in itable. This meant the num- currency.
Surrounded by nations reel- main trade partners, and recent years, according to ber of people who joined "The purchasing power
ing from economic crises, some Bolivians are starting the Confederation of Mi- the informal sector has depends on the level of
Bolivia remains a rare ex- to feel the consequences. cro and Small Enterprises, swelled to about 50%, one prices. We have low infla-
ample of economic sta- Despite the storm clouds, which estimates an annual of the region's highest rates. tion (about 0.6% in 2019),"
bility and growth. And in Morales says he must be loss of more than $2 billion Big industries are also com- Ramos told The Associat-
more than 12 years under returned to power in Oct. a year in its sector, or about plaining about a slump in ed Press. "This price stabil-
President Evo Morales, pov- 20 elections as any change 5 percent of the gross do- the first months of the year, ity guarantees purchasing
erty has dropped steadily would bring chaos. Bolivia's mestic product. with the agroindustry taking power and we must main-
in South America's poorest first indigenous president is Thousands of artisans and the biggest hit. And there tain it."
country helped by soaring one of the few remaining other workers swapped are less earnings from gas A few months ago, Morales
natural gas production. But leaders of the wave of left- their jobs and turned to exports and a reduction of said the economy was
experts say his economic ists who swept into office in commerce because the the market, said Hugo Siles, "shielded," but his economy
model is facing mounting South America in past de- sale of imported electron- an economist of the Na- minister, Luis Arce, recently
tional Industry Chamber. acknowledged that Brazil's

Ex-mayor to face senator in Uruguay's Bolivia exports most of its crisis will affect Bolivia.
gas to Argentina and Brazil. Brazil remains Bolivia's top
presidential race But its neighbors are facing market for energy, but ex-
challenges: Argentines are ports to the region's largest
frustrated by a recession, a country have plunged due
sharp depreciation of their to lower demand and de-
easily won the nomination currency and spiraling infla- clining fields.
of the center-right National tion. Brazilian President Jair Official reports say that ex-
Party. Bolsonaro had a big elec- ports fell from a peak of 31
The 45-year-old Lacalle tion victory last year but is million cubic meters a day
had been the party's can- struggling to advance his of natural gas in 2014 to
didate in the 2014 election. agenda and is also coping 23.8 million cubic meters a
He's the son of ex-President with a tumbling currency. day in 2017.
Luis Alberto Lacalle, who "Argentina and Brazil have Still, the Bolivian govern-
governed from 1990 to had strong devaluations, ment remains optimistic
1995. and that made them more and is betting on continu-
Finishing a distant second competitive in their ex- ity. Since Morales took of-
in the National Party prima- ports," Siles said. "Bolivia fice in 2006, the economy
ry was multimillionaire Juan has had a fixed and stable has grown by an annual
Sartori, a minority share- exchange rate against the average of about 4.5%,
holder in England's Sunder-
Uruguay's presidential hopeful for the Nacional Party, Luis La- land Football Club. dollar for eight years, which well above the regional av-
calle Pou, center, celebrates in his headquarters after being means industries that have erage, and the Internation-
elected candidate for his party in the primary election day in Economist Ernesto Talvi a high component of do- al Monetary Fund says it will
Montevideo, Uruguay, Sunday, June 30, 2019. won the primary for the mestic input are affected grow at 4 percent this year.
Associated Press conservative Colorado by imports and contra- Experts, however, warn
Party, Uruguay's third-larg- band." that growth is largely de-
Associated Press presidential election. est, topping ex-President The fiscal deficit has been pendent on savings and
MONTEVIDEO, Uruguay Daniel Martínez won Sun- Julio María Sanguinetti. rising for six years since the external credits from Chi-
(AP) — A former mayor of day's nationwide primary Forty-one percent of the boom in commodity prices na, while the $15.1 billion
Uruguay's capital will face for the governing center- votes came in the National ended, and it closed at 7% in international reserves
off against the son of a for- left Broad Front coalition, Party contest, versus 24% of GDP last year. This, as reached in 2014 plunged
mer president in Uruguay's while Sen. Luis Lacalle Pou for the Broad Front.q well low private investment, to $8 billion last March.q