Bolivia Overview

Bolivia borders Peru to the northwest, Brazil to the north and east, Paraguay to the southeast, Argentina to the south, and Chile to the west. La Paz, the seat of government, is the world’s highest capital city. It contains many museums and provides visitors with modern and comfortable hotels. Cochabamba, the garden city, boasts a long tradition of local culture and folklore and Tarija City’s excellent climate, combined with beautiful flowers and fine wines, makes it ideal for finding peace and quiet. The states of Beni and Pando, in the heart of the jungle, occupy a region offering visitors dramatic and colourful landscapes. Pantiti’s many rivers provide popular land and water excursions. National dishes include empanada saltena (a mixture of diced meats, chives, raisins, diced potatoes, hot sauce and pepper baked in dough) and lomo montado (fried tender loin steak with two fried eggs, rice and fried banana). Cruzena, is considered to be one of the best beers on the continent. La Paz has many nightclubs, which generally open around midnight. There are folk music and dancing shows on Fridays and Saturdays, which start late in the evening.


General Information

Geography

Bolivia is a landlocked country bordered by Peru to the northwest, Brazil to the north and east, Paraguay to the southeast, Argentina to the south and Chile to the west. There are three main areas: the first is a high plateau known as the ‘Altiplano’, a largely barren region lying approximately 4000m (13,000ft) above sea level. It comprises 10 per cent of the country’s area and contains 70 per cent of the population, nearly one-third of whom are urban dwellers. The second area is a fertile valley situated 1800m (5900ft) to 2700m (8850ft) above sea level. The third area comprises the lowland tropics which stretch down to the frontiers with Brazil, Argentina and Paraguay, taking up some 70 per cent of the land area. Rainfall in this region is high, and the climate is hot.

Government

Republic. Gained independence from Spain in 1825.

Head of State and Government: President Evo Morales since January 2006.

Recent history: The June 2002 presidential election returned the Movimiento Nacional Revolucionario's Gonzalo Sanchez de Lozada as president, his party dominating both houses of Congress. However, a police revolt stemming from multiple fractious factors, such as economic recession and longstanding ethnic tensions, nearly toppled the government of President Lozada, who eventually resigned - following further bloody demonstrations - in 2003. Carlos Mesa assumed presidency and, for a while, seemed the man for the job of quieting this turbulent country. However, he resigned in June 2005 after a surge of protests swept the country. The protests were triggered in May when Congress approved an increase in taxes on foreign gas companies. Demonstrators, drawn mainly from Bolivia's indigenous majority and left-wing groups, claimed that these rises were not enough and were asking for nationalisation of Bolivia's primary - one might say only - source of wealth: energy reserves, namely, oil. There were also cries for constitution re-writes so that more power was distributed to the indigenous peoples. La Paz was at a virtual standstill with road blockades catalysing exhausts in fuel supplies and rising prices. Matters subsided somewhat following Mesa's resignation (although protests weren't really specifically aimed at Mesa), and the appointment of interim President, Eduardo Rodriguez. Presidential elections took place in December 2005. The frontrunners were Evo Morales, a leftist candidate from Bolivia's indigenous peoples, and former President Jorge Quiroga. Morales won a decisive victory and was inaugurated as president in January 2006. Irrespective of the complexion of the government, the most important domestic issue for the government for the last decade has been the US-sponsored ‘war on drugs’ – coca and its products, in the case of Bolivia – which is widely unpopular in a country where coca is considered to be both a traditional product and a valuable cash crop. The government had originally announced that all coca plantations would be eradicated by the end of 2002. This was always highly unlikely and the government eventually conceded 12,000 hectares (approximately 50 sq miles) of plantation for ‘traditional’ purposes. However, since the economic crisis in Argentina and Brazil, which has affected Bolivia badly, impoverished farming communities are making strong demands to be allowed to grow coca once again. The government faces a difficult balancing act between two determined parties; the American administration (which controls most of the purse strings) and an increasingly restless population. Other important foreign policy issues for Bolivia are the development of regional cooperation, principally concerned with trade and economic harmonisation and – on a bilateral level – Bolivia’s persistently problematic relations with Chile. The bicameral congress is the legislature. This is made up of the 27-member Senate and 130-member Chamber of Deputies. Both the Congress and the president, who is Head of State and wields executive power with a Cabinet of Ministers, are directly elected for terms of four years.

Climate

Bolivia has a temperate climate but with wide differences between day and night. The wettest period is November to March, which, in extreme circumstances, may induce landslides in mountainous areas, and cause certain roads to become impassable. The northeast slopes of the Andes are semi-tropical. Visitors often find La Paz uncomfortable because of the thin air due to high altitude. The mountain areas can become very cold at night.

Economy

GDP: US$8.1 billion (2004).
Main exports: Natural gas, soybeans and soy products, crude petroleum, zinc ore and tin.
Main imports: Petroleum products, plastics, paper, aircraft and aircraft parts, prepared foods, automobiles, insecticides and soybeans.
Main trade partners: Brazil, Argentina and Peru.

Bolivia has the second-lowest per capita income in Latin America. Economic growth was forecast 4.5 per cent in 2005. Agriculture employs nearly half the working population, although it suffers from relatively low productivity. The main cash crops are soya, sugar and coffee, while beef and hides from the extensive livestock-rearing industry are valuable export earners. The other key primary product is timber. Bolivia has developed a unique system of sustainable development, which allows for commercial exploitation of high-quality tropical hardwoods without over-depleting the forests. There is also a substantial unregistered and illegal trade in coca, the plant source for cocaine, which provides a livelihood for many peasants – its economic value is thought to be approximately US$1 billion annually. This is a major political issue in the country.

Bolivia has large mineral deposits, especially of tin – of which it is one of the world’s leading producers – and also natural gas, petroleum, lead, antimony, tungsten, gold and silver. Oil and gas deposits serve to meet much of the country’s energy needs and are increasingly valuable export commodities. Reliance on primary products has made Bolivia vulnerable to fluctuations in world commodity prices. Having accepted international demands during the 1990s to liberalise its economy and open it up to foreign competition, the Bolivians have been frustrated by a perceived lack of ‘reciprocity’ – in other words, access to foreign markets for Bolivian products. Bolivia is a member of the Latin American Integration Association, the River Plate Basin Alliance and, most importantly, of the Andean Pact. The country’s largest trading partners are neighbouring Brazil, Argentina and Chile, along with the USA, followed by Japan and the EU countries.