Bolivia gov’s demagogue results: Double Christmas bonus may have precipitated business closures

El Diario reports:

Double Christmas bonus may have precipitated business closures

Screen Shot 2015-08-17 at 10.00.26 AMEconomics expert Julio Alvarado recommended that the Government conduct a study on the factors that determined the closure of 58,000 companies, from June 2014 to May of this year. [cartoon belongs to Pagina Siete]

In statements to El Diario and a local radio station, he recalled that the Government strongly condemned microenterprises, when they expressed their opposition to the payment of double Christmas bonus.

About the origin of the alarming figure, the expert explained that the data comes from Fundaempresa, which is the private sector entity that records the opening and suspension of business operations in the country.

During last year [2014], FUNDEMPRESA had registered 151,000 legally established entities, but as of May this year there were only 93,000 of them.

The expert said that “what happened in the private sector identifies that there has been a worrying crisis, because it can also be noted in the growth of the informal sector dedicated to commerce.”

Screen Shot 2015-08-17 at 10.04.44 AM“Therefore, it is not due to the will or laziness, as the first state authority intended to assume, but to other factors such as social obligations, double Christmas bonus, and above all, the absence of new markets, conditions that generate despair and inability to deal with so many obligations to allow the economic sustainability of these companies,” he said.

International agreements made with the International Labour Organization (ILO) recognizes that tripartism should apply in labor issues. This means that “should involve the state, employers and workers in solving serious problems before they occur, as is happening in the country, the closure of companies,” he said.

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