Bolivian Economics 101: Pretentious debate for a real crisis

A remarkable Editorial from El Diario:

Pretentious debate for a real crisis

A controversy of intensity between state officials and private sector economists has come in recent weeks over whether the national economy is undergoing recession or slowdown, a debate that did not reach results that satisfy the public. Likewise, a similar debate has been taking place around the Gross Domestic Product (GDP), a debate that did not arrive at transparent results either.

However, while the reality offers negative results, the authorities continue to affirm that everything is in good condition and despite some negative indicators are registered, they are not to worry and everything will return to normal, in particular GDP will grow to above the 4.7 percent and, therefore, this year the private companies will have to pay the second Christmas bonus, suspended last year by the low growth of the economy.

In the meantime, what reality proves is not as flattering as the official statements point out, since indicators are presented that reveal that we are experiencing an economic crisis of proportions.

In effect, the population is experiencing difficulties and is reducing its expenses, naturally due to lack of income. Prices have risen in markets and commerce in general; taxis and minibuses have fewer passengers in proportions between 40 and 60 percent; bars, confectioneries and others have reduced their clientele; drivers of some transport plans to lower their rates to recover their occupants; shopkeepers complain of lower sales; the “micros” suspend their routes for some hours; the population that travels to provinces and the interior has decreased considerably, etc.

Apart from these signs at a painful level, the State suffers, (according to official data), by a fall in reserves and an external deficit; the debt to China grew seven times in ten years; the price of some raw materials continues to fall (quinoa) and others have stabilized at low levels (gas, tin); foreign investment has dwindled; the fall in agricultural production obliges the State and individuals to increase food imports and even authorize the smuggling of potatoes, onions, chocolate, flour; the BCB’s reserves fell from 14 to 10 billion dollars; most public companies operate at a loss and so there is a never ending list and allows to verify in fact that the situation is worse than the state spokesmen show.

Finally, while we are arguing over whether we live in recession or decline, in scarcity or abundance, etc., reality shows that there is a situation in fact unrealistic, disguised with phrases, misleading arguments, lying statements, statistical tables, “pies” and invented pictures. What is really to be done is to discuss the real data and, therefore, not to be discussing what is the semantic definition that must have that real crisis that the people live daily, not counting the political crisis with the chaos of Achacachi, the Tipnis, the crisis of the Judicial Power, that acquire Arabian Nights’ character.

Bolivian Thoughts opinion: Let’s not forget that the liquidity existing in Bolivia, is mainly due to the high levels of narcotrafficking, money laundering and smuggling … otherwise the real impact would be far more striking! This is an inept government, the true ochlocracy and the waste of over $160 billion dollars into the hands off the coca grower egomaniac, he is no better than the Lulas, Dilmas, Crstinas, Rafaels, Chavez, Maduros of our sorry South America!

Published by Bolivian Thoughts

Senior managerial experience on sustainable development projects.

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