Bolivia on edge: the dollar soars, diesel is scarce, and prices show no mercy | Bolivia en vilo: el dólar se dispara, falta diésel y los precios no dan tregua

By Juan Carlos Salinas, El Deber; Eju.tv:

The exchange rate of the foreign currency nearly reached Bs 19, while miners marched in the seat of government due to the lack of diesel. In the markets, oil, eggs, and cheese continue to rise in price, while people’s purchasing power keeps declining

Source: El Deber

The country’s economic situation is at its limit, as the constant rise of the parallel dollar, the irregular supply of diesel, and increasing prices are causing unrest among the population, prompting various sectors to take to the streets demanding a solution from the Government, which they blame for creating an imbalance through its market interventions.

Regarding food prices, the Eastern Agricultural Chamber (CAO) clarified that the price of beef will not go down as long as the State continues its interference and fails to address the “structural crisis hitting the national economy,” which affects both producers and consumers.

From Santa Cruz, during the opening of the 2nd International Seminar on Sustainable Livestock, Klaus Frerking, president of the CAO, criticized the state’s intervention in pricing and production planning, denouncing that the Government acts “from a desk, without understanding the reality of the countryside.”

He stated that the rise in the dollar, fuel shortages, legal uncertainty, and smuggling are causing a generalized increase in costs, which ultimately impact the final consumer directly.

“We don’t set the price of meat — it’s set by the market, by dollarized inputs, by smuggling, by the diesel shortage that’s costing us up to Bs 10 on the black market,” said Frerking, adding that “meat prices won’t go down, because the market is being distorted by political decisions and external factors beyond the producer’s control.”

The soaring parallel dollar

The exchange rate of the parallel dollar and digital dollar (USDT) hovered around Bs 19 yesterday before dropping to Bs 17.82, reaching historic highs, according to Fernando Romero, president of the College of Economists of Tarija. He emphasized that this upward trend in the foreign currency will affect Bolivians’ cost of living, as the prices of food, services, and shipping will all increase.

“Food and other products like personal hygiene items have seen a major price hike. Beef, cheese, eggs, oil, coffee, and hygiene products are all expensive. Going to the market is scary now because your money doesn’t go far,” said Romero.

He noted that as the electoral process continues, the country’s economy will remain uncertain and begin to show its true face — “a harsh, but real one — and by November we’ll likely have more clarity on the exchange rate and inflation level,” Romero said.

On the matter, Gary Rodríguez, general manager of the Bolivian Institute of Foreign Trade (IBCE), said on EL DEBER Radio’s Dinero 360 program that to overcome the current situation, exports of products such as meat and soy need to be “unlocked,” as well as pending loans in the Plurinational Legislative Assembly (ALP). He explained that the parallel dollar’s upward trend is the result of several factors, including the fiscal deficit, the fall of net international reserves, the drop in exports, and the high dependence on imported fuels — all of which are paid for in dollars.

“The economy is not just about numbers; it’s also about psychology, and it needs positive signals for recovery.”

As for dollar demand, Rodríguez said there are two sectors that require the foreign currency: the Government — to import fuels needed by the productive sector and civil society — and businesspeople, who import inputs, capital goods, equipment, and recently, fuel.

Diesel shortage

Heavy transport already began pressure measures by blocking the La Paz-Oruro highway on Wednesday, demanding diesel. In addition, today they are holding a national assembly to determine what pressure tactics to begin starting Monday, May 19.

Miners’ cooperatives have joined in, staging a massive march in the seat of government yesterday to demand diesel and dollars.

The protest was organized by the Federation of Gold Mining Cooperatives of Northern La Paz (Fecoman) and was mandatory for members, under threat of economic sanctions exceeding Bs 130,000 for each cooperative that did not participate.

Amid traffic chaos, Fecoman leaders denounced a severe crisis caused by the diesel shortage and lack of dollars.

“Our rights cannot be violated. This march is mainly to demand diesel supply, provision of dollars, and attention to the basic family basket,” said one leader during the protest.

High prices

The effects of the parallel dollar are being felt in the markets, and as economist Germán Molina pointed out, they impact Bolivia’s 11 million citizens to varying degrees, with lower-income sectors suffering the most from rising food prices.

In many markets around the country, a liter of oil now exceeds Bs 25, despite the official price being Bs 14. While the Government insists there is sufficient production and blames speculators and hoarding by sellers, consumers face prices that are double the official rate.

Jorge Amantegui, president of the Bolivian Chamber of Oilseed Industries (Caniob), supported the Government’s view that industrial supply is guaranteed, but noted that intermediaries may be causing market distortions through speculation.

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