Bolivia: the largest informal economy

Jimmy Ortiz writes in El Diario:

Bolivia has the largest informal economy in the world, according to the International Monetary Fund (IMF). In a working document entitled Shadow economies around the world: what have we learned in the last 20 years? In which 158 economies were studied, the country obtained a percentage of 62.3% (El Deber 07-24-18).

This is tragic news for the country. Beyond the government’s eternal optimism propaganda, this is an objective fact, prepared by a serious institution. I believe more in the data of the IMF, than in those of the coca grower.

Although this reality has many connotations, I will only stop at one of them: the lack of social security that it generates.

Social security is defined by The World Labor Organization (ILO) as: “The protection that society provides to its members, through a series of public measures, against economic and social deprivations that, if not, would cause the disappearance or a sharp reduction in income due to illness, maternity, work accident, or work-related illness, unemployment, disability, old age and death; also protection in the form of medical assistance and assistance to families with children” (

In addition, “social security has been considered as a basic human right, in the ILO Declaration of Philadelphia (1944), and in its Recommendation on the Security of Livelihoods, 1944 (No. 67). This right is confirmed in the Universal Declaration of Human Rights, 1948, and in the International Covenant on Economic, Social and Cultural Rights, 1966” (ILO).

It is really unfortunate, how unprotected are our informal compatriots, left on their own fate, in terms of: sickness, maternity, accident at work, or occupational disease, unemployment, disability, old age and death. The support given by the State in these matters is between nonexistent and very precarious.

I wonder: Is it not the main objective of the economy, the welfare of the people? What are the macroeconomic figures, in a country without social security? Can a successful model be described, with this tragic reality of our people?

The masismo mermaid songs, exacerbated in electoral times, cannot hide this reality. The only ones that are good are them, it’s time to change them.

Published by Bolivian Thoughts

Senior managerial experience on sustainable development projects.

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