Bolivian Economics 101:The economic agenda, in its ‘infancy’

This is an interesting and enlightening article made by Juan Carlos Salinas Cortez for El Deber:

Already five months passed since at the Social and Economic Summit in Cochabamba and promoted by the Government to ‘set the ground rules’ for the elaboration of economic and productive agenda with the private sector. However, so far the topic sounds more like a tango of promises, cries and disagreements.

The vaunted national economic agenda, the engine which was to guide the development of the country, according to the Executive, in accordance with departmental business federations, is in its ‘infancy’.

If it is true that the federations associated with the Confederation of Private Entrepreneurs of Bolivia (CEPB) opted for a ‘shortcut’, which is the regional way to negotiate and develop a departmental agenda that meets local needs directly, consider that it is important to count with a national scope tool to configure the role of entrepreneurship in the development of the country.

In this regard, Ronald Nostas, first Vice-President of the CEPB, recognized that in the elaboration of the economic agenda, the progress was very little.

He remarked that the important points raised in Cochabamba, as energy and food security, boosting production and investment, a policy for the promotion of employment, the conclusion of economic laws, remain outstanding issues and has not been working progress.

Nostas stressed that neither the Economic and Social Council that the Government had accepted as a permanent mechanism for dialogue and consultation has been formed.

More salvageable, according to the employer, so far are the contacts and the dialogue space that the CEPB has opened with the Government, and that allows to raise specific problems of economic sectors, to seek some solutions, particularly in the four sectors that the Executive has given priority to (oil, mining, energy, safety and food sovereignty).

When asked where the obstacles that originate, hindering the development of such an important document, Nostas explained that it still warns a prioritization of the political agenda over the economic.

“We believe that it is urgent to work seriously on an economic agenda agreed with the private sector.” “The economic situation prevents more planned work in this regard and unfortunately drift in internal disorientations in the Government, which do not allow us to make progress on issues that are extremely urgent and high priority for the immediate future of the Bolivian people,” he noted.

From the Federation of Private Businessmen of La Paz (Feplp), they regretted that the national agenda is stalled or its advance resembles the speed of a turtle.

From this La Paz institution, they remarked that it is necessary for the Government to issue clear signals with respect to legal certainty, the search for new markets and working with the various departmental federations.

For Soraya Fernández, Executive Director of the Feplp, the work of the CEPB still fails to be fairly representative and the construction of the economic agenda is limited to the ‘mood’ of the responsible Ministers.

Similar approach had Ricardo Dellien, President of the Federation of private businessmen of Beni, he was more critical and remarked that the CEPB is disassociating its members to focus on other problems that are neither technical nor economic.

Dellien argued that there is a kind of divorce between the parent body of employers and the various regional, affecting in the development of a national and unifying proposal.

He gave the example of what is happening in the Department, where the support from the Executive, to farmers is only confined to communities and owners of up to 80 cattle and leaves out the medium and large cattle ranchers, who also need resources and who feel alone because the CEPB is not speaking.

On the urgent needs facing the sector, Nostas said to expect compliance with the commitment of Cochabamba, putting into operation the Economic Council, as it is considered that this will enable concerted and effective progress in the structuring of a true economic agenda that prioritize the Act of investment, labor and various sectoral laws that allow to create the conditions to attract domestic and foreign investment.

Terms and conditions for investments, Fernando Dehne, President of the Federation of Private Businessmen of Oruro (FEPO), pointed out something which concerns its sector, is legal uncertainty, it is reflected in the mining problems that increasingly occur, causing uncertainty among workers and potential investors.

Dehne indicated that at this point the CEPB does not have a firm position to demand the Executive to ensure that investments made by domestic and foreign companies are respected.

“No doubt that need a national economic agenda to ensure the safety of investments and that even there is no progress,” he regretted Dehne, who pointed out that, in the first instance, a regional work with local authorities is more productive.

For the maximum leader of the entrepreneurship in Santa Cruz, Gabriel Dabdoud, a regional, productive economic agenda and development is the task that must be done, beyond a general and national proposal.

To know the Government’s position, a questionnaire was sent to the Ministry of Productive Development, responsible for work on the economic agenda, but because of time concerns, they could not answer.

There is discontent at the lack of a public-private partnership project

La Paz

Urgent new markets

For the Executive Director of the Feplp, Soraya Fernández, the business situation of the Department is critical, since the textile industry could not be retrieved for the loss of the tariff preferences of the ATPDEA law and to the Venezuelan market appeared as an option, its impact is low compared with the USA. Fernandez indicated that another weakness is the lack of investment. [Ametex is going bankrupt and has been for many years an international example, I have seen international organizations praising the work of this entrepreneur, unfortunately for the reason also presented here, this business is going down. Current government’s reaction was to create a state-owned company, that is certainly the worst possible solution, simple demagogue -governmental market offers- to assess a problem on the state-side…]


The development of tourism

Jaime Uzquiano, head of the Federation of private businessmen of Potosí, pointed out that one of the weaknesses of the private sector is the lack of productive diversity, which slows the growth of the Department. For this business leader, one of the objectives of regional development agendas is the bet to enhance some strengths of the place and, in the case of Potosi, tourism should be the priority.


We are not moving

Jaime Ponce, President of the Federation of private businessmen of Cochabamba, said that you can not speak of concrete progress in the elaboration of the economic agenda. Ponce remarked that they are working on the investment plan 2012-2015 proposed by the Government, which covered 28 production complexes, which must be strengthened through public and private investment in the coming years.

Santa Cruz

Working locally

The Federation of private businessmen of Santa Cruz (Fepsc) believes that the North that should guide the construction of the economic agenda is local working with authorities in the region who know the needs of the sector closely. Gabriel Dabdoub, Fepsc President, argued that each institution has its work and that the CEPB, federations and Chambers are called upon to strengthen the country’s economy.


“The economic agenda should be a priority for the Government, the more we back, we lose more opportunities” Ronald Nostas | Vice-President of the CEPB

“We must diversify our production, and that alone will be working with the municipal and departmental authorities” Jaime Uzquiano | President Private Entrepreneurs of Potosí

Peace needs investment for new markets. “There are promises, but nothing concrete and with the good will do nothing” Soraya Fernández | Executive Director, Private Entrepreneurs of La Paz


– In the context of food sovereignty and security, the participants in the social Summit of Cochabamba raised the State must promote the camelid livestock meat consumption, for which a standard that ensures this initiative should be implemented.

– In this regard, federations of Potosí and Oruro, areas where there is the largest herd of camelids of the country indicated that so far there is nothing concrete.

– Among other conclusions, stands out the levelling of prices in border areas of those fuels with subsidy from the State, as a measure to combat the smuggling of the product activity. In this context, participants raised to deepen the implementation of Law No. 100, whose purpose is to strengthen the control and – development of border areas. Similarly, implement more control to service stations installed in these regions.

– So far, the price of fuel in the border areas remain the same value, except for vehicles with foreign nameplate, which must pay more expensive [price].

– The small and medium businesses, as well as craftsmen and farmers economic organisations (OECA), raised the reform of the financial system for the purpose of creating greater access to productive credit mechanisms. The document of conclusions of the sector argues that financial reform should enable the bank liquidity to be channeled to the productive development, which should be supported with the enactment of a new law on banks and financial institutions.

– At this point is where progress is noticeable. In Santa Cruz, the productive medium and large sector held various meetings with the authority of Supervision of the financial system (ASFI) and representatives of banking to go looking for alternatives that will allow the industrial sector and, in particular, agriculture access to credit system financial is offering.

– The need to speed up the approval of the contracts for exploration and exploitation of hydrocarbons that are still in the Legislative Assembly. Also considers the implementation of new mechanisms to expedite obtaining environmental permits, which nowadays also delayed exploration and production activities.

– The Federation of private businessmen of Chuquisaca indicated that this point was not was treated and that the conflicts with the various communities because of the environmental permits continue to be a drag.

Unfortunately, the article above is crystal clear, need say no more!

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