Diplomacy in Times of Fiscal Adjustment: Should Embassies Be Closed? | Diplomacia en tiempos de ajuste fiscal: ¿Hay que cerrar embajadas?

By Windsor Hernani, Visión 360:

The establishment of diplomatic missions between two states is not an act of ideological loyalty, personal sympathy between heads of state, nor a matter of political improvisation.

Bolivia has been facing a recurring fiscal deficit for over eleven years, an external debt surpassing $13 billion, and a steady loss of international reserves. In this context, it is urgent to reduce public spending, including expenditures on the foreign service. The embassy network must be redesigned realistically, technically, and intelligently — not ideologically.

The establishment of embassies must respond to strategic and practical criteria aligned with the national interest. Beyond representation and protocol, embassies should generate tangible political, social, or economic benefits. Legitimate reasons for maintaining them include: reasonable trade flows or potential market access, viable sources of foreign direct investment, and opportunities for economic, technical, military, or other forms of cooperation.

A cost-benefit analysis is also relevant, though not decisive. If costs far exceed benefits — not only monetary — the alternative is to establish non-resident coverage from another mission, or ultimately, to close the embassy.

Currently, Bolivia maintains three permanent representations (OAS, UN, and UNESCO) and 34 embassies: 11 in the Americas, 4 in Central America and the Caribbean, 11 in Western Europe (including the Vatican), 2 in Eastern Europe (Russia and Turkey), 3 in East Asia (China, Japan, and South Korea), 1 in South Asia (India), 1 in the Middle East (Iran), and 1 in Africa (Egypt).

Regarding permanent missions, it is impossible to do without the OAS and the UN, even though Bolivia’s voice is muted at present due to unpaid contributions. Both are key forums for dialogue — one regional, the other multilateral — on critical issues such as peace, security, sustainable development, climate change, democracy, and human rights, as well as a channel for accessing cooperation programs.

The case of UNESCO is different. While representation is necessary, austerity suggests that its office could be temporarily absorbed by Bolivia’s Embassy in France, optimizing costs without losing presence, since both are located in Paris.

On the bilateral front, Venezuela has undergone deep institutional, political, and economic deterioration. The erosion of democracy led several South American countries — Argentina, Chile, Ecuador, Peru, Paraguay, and Uruguay — to sever diplomatic ties. It has been suspended from both the OAS and Mercosur. For Bolivia, the relationship with Caracas is economically marginal: exports account for just 0.06% of the total, imports 0.004%, and there is no common agenda, except perhaps on migration.

Despite these negative aspects, considering that relations are between states and not governments, and that Bolivia and Venezuela have maintained diplomatic ties for more than 140 years, closing the embassy outright is not advisable. A reasonable approach would be to administer the relationship through concurrent accreditation from the Embassy in Colombia.

Cuba and Nicaragua present a similar outlook. Trade is virtually nonexistent, Cuban medical cooperation has proven costly, and there are no foreseeable areas of shared interest. For reasons of diplomatic efficiency, both missions should be managed from Costa Rica.

Even the Embassy in Panama should be evaluated, as it shows little activity and could be absorbed by Costa Rica or Colombia.

Iran is a special case. Bolivia established full diplomatic relations in 2007 — a decision clearly driven by ideology. Although agreements were signed in hydrocarbons, mining, agriculture, and infrastructure, none materialized.

Bilateral trade is nonexistent, and the only active ties relate to security and defense agreements that have been strongly criticized domestically and by neighboring countries. In South America, only Bolivia and Venezuela maintain embassies in Tehran. Other countries keep minimal contact, while Argentina and Colombia severed relations over terrorism and insurgency concerns. Under these parameters, Bolivia’s embassy in Iran is a prime candidate for closure.

Public information is scarce, mainly limited to audit reports, which prevents a more thorough evaluation. Other missions, such as those in Austria and South Korea, should also be assessed, as little is known about their diplomatic output.

Maintaining embassies with no practical value is not an act of sovereignty but of fiscal irresponsibility. In times of crisis, diplomacy must be a strategic tool, not an inertial expense. The network must be trimmed without isolating the country. Redesigning Bolivia’s embassies based on real utility, economic impact, and international projection is an urgent necessity.

Leave a comment