What are the main challenges for the next president of Bolivia

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Whoever is the winner of the elections this Sunday, will assume the reins of a country submerged in a deep economic, political and social crisis.

The outlook seemed uncertain this Sunday in Bolivia. But there is a certainty. Whoever wins the presidential election will surely have a winding road ahead of them. After a year of the deep political crisis that erupted after the tumultuous October 2019 elections, aggravated by the coronavirus hit, it will not be easy for the country to get back on track.

The government that takes office in January must take steps to stop a sharp drop in the economy. But first, it will be essential to guarantee a certain stability and social peace that allows to lay the foundations to govern, in a country torn by an abysmal rift.

The remarkable growth that the country had achieved during the government of Evo Morales, which when he took office in 2006 gave a strong turn to economic policy with the nationalization of hydrocarbons – favored by a tailwind encouraged by the high prices of raw materials that the country exports, especially gas, oil and other minerals – has already begun to slow down in recent years. Y the global crisis due to the pandemic ended up sinking Bolivia’s numbers.

The coronavirus, which in Bolivia left almost 140,000 infected and more than 8,400 dead, accentuated the problems of the economy in this nation of more than 11 million inhabitants, which fell 7.93% until July in relation to the same period last year .

The unemployment rate in cities soared from 6.6% to 10.5% between January and August, according to official data, mainly due to the quarantine decreed since March. And if you take into account that much of the employment in Bolivia is informal, the data could be much more alarming.

During the nearly 14-year Morales government – which ended abruptly in November of last year – Bolivia promoted an economic model that prioritized the exploitation of the country’s natural resources, but a number of economists and analysts criticize that this was done. without diversifying the productive apparatus and increasing its dependence on the primary sector.

GDP growth reached its peak in 2013 with 6.8%. This bonanza made it possible to reduce poverty from 60% to 37.2% and extreme poverty from 38.2% to 12.9%, according to official data, with Luis Arce at the helm of the Ministry of Economy for much of the Morales government.

In addition to a notable distribution of wealth, hand in hand with “bonds” for the most vulnerable groups, especially students, retirees and pregnant women, this liquidity was seen in important infrastructure improvements, the purchase of a satellite or the installation of the La Paz cable car that helped to decongest – a little – the chaotic traffic of the city and gave it a modern profile, along with the construction of imposing buildings.

But when that “super cycle” slowed down, the government continued to inject resources into the economy using international reserves and increasing indebtednessexperts say.

Growth began a gradual decline since 2014. In 2019, GDP expansion was 2.2%, but for 2020, due to the pandemic, a 6.2% drop is estimated according to the Bolivian Central Bank and the IMF. Other voices are even more pessimistic.

“The forecasts are very harsh. There is talk of a decrease of around 7 to 8%, in a context in which the prices of gas and other raw materials are much lower than in the past. Gas reserves are smaller, the markets (especially Brazil and Argentina) are negotiating from an advantageous position and during the previous 14 years we have not looked for export alternatives to compensate for critical moments ”, he explained to Clarion the analyst Hernán Terrazas, from the Rodriguez & Baudoin consulting firm, from La Paz.

“To this must be added the difficulty that the future president will have to ensure reasonable governance in a scenario of strong confrontation,” he added.

That will be the other huge challenge for the next government. Appease deep polarization that marked not only this last year, but that already dragged on for some time, when the enormous support that Evo Morales had achieved -in 2009 he was re-elected with more than 64% of the votes and in 2014 he achieved a new mandate with 61% – It began to crumble, amid accusations of corruption and the rejection of an important part of the population to practices and policies that they considered authoritarian.

Especially the middle sectors of the population began to distance themselves from the first indigenous president of the country.

“The next government will have to assume a multiple and simultaneous crisis,” he explained to Clarion the political analyst Erika Brockmann: “An economic crisis, a health crisis and of course a very strong political and social crisis. It will again require a spirit that goes to the construction of pacts and agreements, ”he said, especially since it is possible that no political force will achieve a sufficient majority in Parliament to be able to govern without agreements.

“The situation is not easy. We have to resolve the political issue first, and then resolve the other issues. A reform of the Justice will also be necessary, which was submitted to the Executive Power for years ”, he remarked.

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