Daily Archives: January 2, 2014

Investment trends in Bolivia during 2014

Efrain Valera and Gary Rojas report for El Deber:


Ten sectors that seduce investments for 2014

Market. Food, buying franchises, services to extractive industries, among others, open the opportunity to new capital.

2014-01-01 08.14.59 amThe chia, quinoa, wheat, sugar cane and fruits are some of the sectors seeking to attract more investments in 2014, driven by the growth of domestic demand and its good external prices.

According to suggestions from advisers in investment, economic analysts and businessmen consulted by Dinero [section of this newspaper], construction and sale of real estate, the stock market, oil services, franchises and the import of car spare-parts, are added to these sectors.

Marco Hurtado, President of the Chamber of real estate of Santa Cruz, said that investments in 2013 were concentrated in the construction of shopping malls, condominiums, hotels and business buildings. He said that with the new law of regulation of the rates of interest for the purchase of housing, projected higher growth. However, he added that there is a risk that the capital will only focus on segments of the high and medium-high market where there “is already an oversupply”.

Hurtado identified as niche market the construction of buildings, houses and apartments to families from the socio-economic middle segment and young professionals.

Another alternative is to invest in bonds, stocks and notes offered by the Bolivian Stock Exchange [Bolsa de Valores] (BBV). Javier Aneiva, general manager, said that the BBV is a conducive market that facilitates liquidity, security and return appropriate to the economic situation of each moment.

A good option in the short-term are promissory notes, as the SMEs in 270 days, they provide a fixed return of 4.52%, in addition to the bonds of the State General Treasury, with a yield of 4.02% to 720 days.

“The income from the shares are variable. They are instruments of risk investment but that offer opportunities for high yield,”said Aneiva.

For firms that are oriented to the oil sector and gas painted a better year, with the approval of five oil contracts for the exploration and exploitation of areas in Cochabamba, Santa Cruz, Chuquisaca and Tarija. Chaco YPFB, Petrobras Bolivia and Bolivia BG executed these works.

“Companies operating in Santa Cruz and Tarija, mainly, will have steady growth from 2014, as their demand already grew by more than 20% in 2013, compared with the previous year,” revealed the investment analyst Jaime Dunn.

The expert said that investments in the sector of food, entertainment and health are “always promising” when the middle class begins to expand.

On the other hand, the market of franchises in Bolivia is already mature and become a great alternative investment. That was the recommendation made by the President of the Bolivian Chamber of franchises, Miguel Mardoñez, who stressed that the future market niches will concentrate on clothing (by age and gender), cleaning and beauty (in Santa Cruz).

Roberto Pérez, Manager of the first company of franchises in Bolivia, America Srl, explained that success rate which an investor has in the first five years reaches 95%.

The import of vehicle spare-parts is proposed as a windfall. Automotives, old and new, grew up in almost 200,000 vehicles in just a year.

Agricultural bet

For the chia, the business is located in the domestic market, explained producer German Cuellar, of the Committee the Chia in Cadex. He said the purchase in domestic market reached $2,000 per ton and its international price reached $5,000 dollars.

“Not necessarily a rise in prices means a profitable business in the long-term,” says Paula Mejia, Manager of the Bolivian Chamber of quinoa exporters, referring that the ton of cereal this year rose $3,200 to more than $6,000.

“With the largest supply of the product by 2014, it is projected to stabilize its value,” she said.

On the other hand, next year a recovery in prices of sugar cane is projected, because this year there was a drop in national production and the value of quintal, which fell from Bs270 to Bs160.

For his part, Dunn said that wheat is still greater significance and concern in our country, since 650,000 tons is required annually by the Bolivian population, domestic production only covers 38%.

The planting of the tangerine, incur variety, opens another opportunity. According to Nue Moron, President of the Federation of fruit growers and gardeners of Santa Cruz, in a hectare of mandarin about Bs4,000, are invested not counting the cost of the property, and in two years the producer can market them between Bs25 and Bs65 per 100 of them.

Agricultural dynamism makes that imports of agricultural inputs is another good option for investing.


I just hope that this electoral year and the illegitimate re-re-election does not distort the market… after all had there be no producers, there would be no races… ergo no politicians… as most of these individuals enter the public sector just to grab wealth.