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A Neighboring Country of Brazil Is Facing a Serious Economic Crisis Marked by a Lack of Gasoline, Diesel, and Dollars, Raising Concerns About Its Stability.
Bolivia is experiencing widespread chaos, with political instability and economic collapse. In June, a rebellious general attempted a coup, highlighting the government’s fragility. Meanwhile, the country is facing a currency and economic crisis that worsens month by month.
Since February 2023, with the central bank’s reserves depleted, weekly reports on available dollars have ceased publication.
The government has since been trying to accumulate dollars, while the gap between official exchange rates and the illegal market is rapidly widening. Imported products are disappearing from shelves, and prices are skyrocketing, signaling a possible imminent devaluation.
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50 viaducts, 4 tunnels, 28 bridges, and 40 kilometers of bike paths: BR-262 in Espírito Santo will receive 8.6 billion reais for the largest engineering project in the state’s history, inspired by the Immigrant Highway in São Paulo.
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Brazil produces too much clean energy and doesn’t know what to do with it: over 20% of solar and wind capacity was wasted in 2025 while investors flee and 509 renewable generation projects were abandoned in the last year.
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Piauí will produce a new fuel that replaces diesel without needing to change anything in the truck’s engine and reduces pollutant gas emissions by half: truck drivers from all over the Northeast are already celebrating the news that will arrive later this decade.
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A new Brazilian shopping center worth R$ 400 million will be built in an area equivalent to more than 4 football fields, featuring 90 stores, 5 cinemas, a supermarket, a college, and parking for 1,700 cars, potentially generating 3,000 jobs.
The Collapse of an Economic Model in Crisis
The Movement for Socialism (MAS) has governed Bolivia almost continuously since 2006, structuring its crisis-stricken economy around subsidies, a fixed exchange rate, and public investments. This model, financed by dollars from natural gas exports, brought stability and growth in the past.
However, declining commodity prices and a drop in natural gas production have weakened this foundation. International reserves plummeted from US$ 15 billion in 2014 to just US$ 2 billion currently, with only US$ 153 million in liquidity. This has made it difficult to pay for essential imports, such as fuels, leading the country into a scenario of “prolonged agony.”
Impacts on the Real Economy
Shortages and high prices are suffocating the population and businesses. Importers face empty stocks, supermarkets have bare shelves, and exporters struggle to obtain supplies. The situation is critical: GDP is expected to grow only 1.6% this year, the lowest rate in two decades, excluding the pandemic period.
Billboards featuring images of President Luis Arce praising economic stability have been removed. Inflation, once a source of government pride, is now one of the highest in the region.
Divisions in the Government and Political Challenges
The Arce government faces pressures from all sides. Private sectors are calling for liberalizations, while unions demand greater control over exporters and forced repatriation of dollars. Publicly, Arce avoids definitive decisions, but the political impasse is evident.
The internal dispute within MAS, with Evo Morales seeking to be a candidate in the upcoming elections, paralyzes governance. The approval of US$ 1 billion in loans in Congress remains stalled, further compromising the recovery of a crisis-stricken economy.
Protests and an Uncertain Future
Workers, the MAS’s electoral base, are beginning to show dissatisfaction. The combination of shortages, rising prices, declining purchasing power, and increasing poverty fuels discontent. Gabriel Espinoza, former director of the central bank, warns that the current scenario could escalate into social conflicts soon.
Luis Arce is trying to postpone painful reforms until after the elections, but the population’s patience is running thin. Bolivia is at a critical juncture, and the country’s future depends on decisions that may challenge the government’s principles and change the course of recent history. With information from The Economist and local news sources.
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