Ekonomske analize


Population 11.3 million
GDP 2,943 US$
Country risk assessment
Business Climate
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major macro economic indicators

  2013  2014  2015 (e)  2016 (f)
GDP growth (%) 6,8 5,5 4,8 3,8
Inflation (yearly average) (%) 5.7 5.7 4.3  4.8 
Budget balance (% GDP) 0.6 -3.3 -5.2  -5.7 
Current account balance (% GDP) 3.4 0.0 -4.5  -4.9 
Public debt (% GDP) 32.4 33.0 38.0 41.8 


(e) Estimate (f) Forecast


  • Significant natural resources (gas, oil, zinc, silver, gold, tin and manganese)
  • Membership of the Andean Community and association with Mercosur
  • High foreign currency reserves 


  • Little economic diversity and dependency on hydrocarbons
  • Landlocked country
  • Size of the informal sector 
  • Insecurity and drug trafficking 
  • Risk of social unrest

Risk assessment

Slowing activity because of low oil and gas prices

In 2015, growth in the Bolivian economy suffered with the fall in oil and gas prices and remained below the 5% average of the last seven years. In 2016, growth is likely to struggle as the contribution from foreign trade feels the impact of lower commodity prices (natural gas, oil and minerals) which account for almost 90% of the country's exports. The lack of diversification within the economy and structural weaknesses (continued mediocre business climate and poor infrastructures) will also contribute to reduced activity. Domestic demand should remain solid, sustained by the government’s expansionary budget policy. Public investment should therefore rise with the implementation of a recovery plan aimed at increasing production capacity in the mining sector. Household consumption should remain strong thanks to the effects of public investment in terms of jobs and wages, and thanks to the various social programmes. FDI is likely to remain low due to low oil, gas and mineral prices, its favoured sectors, but also because of the instability of the regulatory framework.
Inflation is set to rise slightly as purchasing power grows, but will nevertheless remain below the target range (5 - 5.5%) set by the central bank. A continued stable exchange rate and subsidies on basic foodstuff imports should, however, keep it within bounds.


An expansionary policy despite shrinking budget revenue

The public accounts deficit, which emerged in 2014, should deepen in 2016. The budget balance will be hard hit by low commodity prices (almost 47% of public sector revenues) and by higher spending associated with the public investment recovery plan. This latter will be partly financed by the FINPRO (Fondo para la Revolución Industrial Productiva) sovereign wealth fund, and the government is not ruling out the possibility of calling on external financing. Increasing the public deficit and recourse to the financial markets will lead to an increase in the public debt, estimated at almost 40% of GDP in 2016.

The wiping out of the balance of trade surplus continues to weigh on the external accounts
In 2015, Bolivia recorded its first current account deficit in almost 12 years. In 2016, this should worsen, resulting from the foreign trade deficit and the loss of competitiveness of its exports because of the stability of its currency at a time when other leading regional currencies are being devalued. Earnings from gas exports (49% of all exports) are suffering as commodity prices fall and with the slowing of the Brazilian and Argentine economies (the two leading buyers of Bolivian gas). The balance of services, in structural deficit, and that of revenues should remain negative, because of the scale of the repatriation of dividends by foreign companies. The balance of transfers however is likely to remain in surplus thanks to private remittance transfers.


A business climate that remains difficult

In power since 2005, President Evo Morales and his MAS (Movimiento al Socialismo) party remain the dominant political force in Bolivia, despite the increasing number of corruption scandals which lost several MAS candidates their seats in the most recent elections in March 2015 The President seems however to have escaped damage to his image and he is likely to win the national referendum to be held in 2016 enabling him to hold office indefinitely. Evo Morales should therefore be set to win a fourth term of office in 2020. The government’s failure to satisfy the expectations of a variety of social groups is however a potential source of social unrest. The inability of the Bolivian government to agree on how much compensation should be paid to expropriated investors, prevailing legal insecurity (expropriations and nationalisations remain a possibility) and the prohibition on any international arbitration continue to undermine the business climate in Bolivia.


Last update: January 2016

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