The Bolivian model: dedollarisation, investment and r …

Governments of Movement towards socialism in Bolivia and of Wide front in Uruguay They are facing the general election of October. The two mandates take several years and accumulate outfits that seek to take advantage of their opponents, but the triumph of Andrés Manuel López Obrador in Mexico last year and from Alberto Fernández in the recent primary of Argentina, beyond the circumstances of each country, they are read in the vicinity of Evo Morales and Tabaré Vázquez like a regional crack to neoliberal order. And they hope their proposals will be revalidized next month. It is necessary to stop in the badysis of the Bolivian electoral scenario (where the presidential elections will take place on October 20th) in economic and social matter.

Whatever the opinion on the time of Evo, a Aymara President for the first time in the history of an essentially indigenist Bolivia, nobody knows it stability reached nor economic growth. Hegemonic media tends to mask both data.

Stability (obtained by Ecuador over the years of Rafael Correa or during three Kirchner governments in Argentina) shines even more, as it has continued to be extremely chaotic in these and other countries in the region. Evo arrived at the government in 2006 after a cycle of permanent turmoil, abrupt presidents' changes, social outbursts, deaths and hyperinflation. The same could be said of the other countries mentioned. Just this article, institutional stability which encourages growth, would be a basic principle to positively evaluate its management. It's hidden.

But in addition, this first historical experience of government in the hands of originating peoples in Bolivia It offered a remarkable business cycle, already 13 years old. With a growth of 4.4% of GDP, Bolivia was the fastest growing country in 2018 in South America. The previous two years were 4.2% and 4.3% respectively, which is also a drag on regional economic expansion. The complete statistical series of GDP has been positive during the mandates of the Evo Morales. In 2008, 2013 and 2014, it peaked at around 6%. Note that this rate was higher than the Latin American average, while the terms of trade have changed less well in Bolivia than in most other countries between the crisis of 2008 and 2017.

Last August, the Bolivian Central Bank organized a seminar to discuss the regional and international financial situation. In addition to economists from many countries, 8200 students participated. Rare for a central bank, which does not present itself as "independent" (coordinates weekly actions with the Ministry of Economy) or as a technocrat and indecipherable to the people. An Argentinian who participated, Guillermo Robledo, coordinator of the Observatory of Wealth, Father Pedro Arrupe, came back marveled. "For a decade, I did not go there and, he says, there is a relaxing atmosphere in the streets, pride of what has been accomplished, of kindness, with a city like La Paz and El Alto ( others are already developing it) with several lines of "plane ticket", as we call the new gondolas; with a population that has increased its life expectancy by 10 years (from 64 to 74 years in a single decade) and is discussing the future, for example how to add to the gas and lithium production of agri-food products for the world, based on the quinoa and its other products. Bolivia already has some very important customers like India, then China (which also provides infrastructure) and, behind its traditional customers in our region or the rest of the West, Russia.

For Robledo, "the financial model has also been very successful. They were also or more dollarized than in Argentina and they managed to reverse it (for example, to tax more VAT on dollar transactions, which was usual and has now fallen), they practically l & # 39; inflation and his interest rate They are close to 0%. From the Central Bank, they became involved in macro and micro activities and managed the profitability of each sector. And no investor complains or leaves the country.

according to CEPAL, the engine of GDP growth is public investment, but also highlights the expansion of consumption. And he expects that in 2019 he will pursue "the impetus for public investment in infrastructure and energy as well as in health and education", which, combined with growth sustained consumption, would allow "the economy to continue to show a growth rate similar to that of 2018". And for the Latin American Alliance of Economic Consultants, the year 2019 will complete with an expansion of 4%, far the most important of the region. While something was going up the budget deficit, recovery of hydrocarbon prices (main source of external revenue, gas exports) in 2018, it took calm in the national public coffers. Mines around lithium This is another source of investment.

The main rival of Evo is former President Carlos Mesa, who has gained popularity in recent years, as the government has appointed him to represent him in international claims for the delicate issue exit at sea, in the context of the legal dispute with Chile. The rest of the opposition is shot down (the third in the polls appears senator and right-wing businessman, Oscar Ortiz) and only campaigns denouncing the alleged unconstitutionality of the attempt of the formula of Morales.Lines Álvaro García to repeat in the burned palace: he discusses with the plebiscite of 2016, the result of which would prevent it, but which was later reversed in Justice. With regard to the economic direction and the role of the state in this matter, the opposition does not contest it either. Fernando Mayorga, University Mayor of San Simón de Cochabamba, said that "there is a consensus on economic management. There is no opposition from antagonistic projects, the candidates have moved to the center of the political and ideological spectrum and there is a convergence regarding economic model"It is difficult for the opposition to attack the current economic model, given its success," he added.

A former diplomat in La Paz said: "Mesa is a good candidate and Evo has a ceiling that he has to overcome to reach 50% of the votes he would need in the first round. If you do not succeed or if you take 40% plus 10% advantage per second, a ballot it would be difficult for him because the right would use the useful vote to try to dislodge him from power. However, the latest surveys are improving them. "

In the MAS, and although previous surveys do not work well in city halls, they are based on a good national result because of the weight of rural sector. And win in the first round. Its leaders know that the right is weak because of the social and economic reinforcement achieved by the MAS governments, which is no less important: the greater self-esteem of a people historically subjugated by a minority elite. And they know that they can not fall asleep before the erosion of the government and the new demands of a people who agreed to new rights and, fragile by heart, he can quickly change his perspective, as in Brazil or Argentina.