Recalibrating Bolivia’s Power Map | Reconfigurando el rumbo político de Bolivia

By María Trigo, Eju.tv:

Internal tensions, shifts in foreign policy and postponed economic adjustments: this was the first month of Rodrigo Paz’s government in Bolivia

The beginning of the administration showed a radical change in international relations and a feeling of economic stability without addressing structural reforms. However, internal conflicts dominated the agenda.

El presidente visitó la localidad

The president visited the town of Achira, in Santa Cruz, after the disaster caused by heavy rains (REUTERS/Ipa Ibanez)

A month has passed since the inauguration of Rodrigo Paz in Bolivia. The first weeks of his administration have been defined by a radical shift in foreign policy, a feeling of economic stability, some contradictions with his electoral proposals that have not generated major controversy, and an explicit distancing from the vice president, who has occupied the center of the debate.Trips to Bolivia

In his first hours as president, Paz raised the flags of what would be his government’s position in foreign policy: he received a delegation from the United States, a country with which Bolivia has had no relations since 2008 after the expulsion of the U.S. ambassador amid accusations of conspiracy; and from Israel, a country that Bolivia had confronted in major international forums, condemning the attacks in Gaza that it described as a “genocide.”

Despite this shift, the government has not broken relations with countries such as Cuba, Venezuela or Nicaragua, which were allies of the governments of the Movement Toward Socialism (MAS). Under the slogan “Bolivia to the world and the world to Bolivia,” the new government has indicated that it will focus international relations on countries with which it shares principles but will not stop “dialoguing” with other nations.

Paz saluda a Christopher Landau,

Paz greets Christopher Landau,Paz greets Christopher Landau, U.S. State Department Undersecretary (REUTERS/Claudia Morales)

In economic matters, the convergence of two key factors —the normalization of fuel supply and the fall in the parallel dollar rate— has created a feeling of economic stability that some analysts describe as fragile and misleading, because it does not stem from structural reforms.

Without adopting deep measures, the government managed to regularize the supply of diesel and gasoline, which had been scarce in the last two years and symbolized the country’s economic crisis, with endless lines of vehicles at service stations and a consequent impact on household prices.

The rise in the parallel dollar also gave a respite. Several economic analysts point out that it is due to a greater supply of dollars, expectations of stability after the political change, a decrease in speculative demand, and greater use of cryptocurrencies.

Una fila de camiones espera

A line of trucks waits to load fuel in Bolivia (REUTERS/Adriano Machado)

However, the origin of the crisis is deep and remains intact: it has to do with the sustained fall in gas export revenues, which reduced the availability of foreign currency and weakened international reserves. Added to this is a persistent fiscal deficit over several years, financed through borrowing and pressure on reserves.

Economic reforms in Paz’s first month have been limited to announcing a reduction in public spending in 2026 and eliminating some taxes that represented only 1% of tax collection but which, according to the government, caused major harm to businesses and discouraged investment.

Meanwhile, the structural measures, which in the short term include liberalizing the exchange rate and gradually or fully lifting fuel subsidies, were postponed until March of next year, after the autonomous elections in which local authorities will be renewed.

“They fear that by launching the measures, which are quite unpopular, before the election, they will lose territorial control in a disastrous way,” says political communication analyst and consultant Carlos Saavedra.

Una mujer realiza compras en

A woman shops inA woman shops in a market in La Paz, Bolivia (REUTERS/Adriano Machado)

For journalist and political analyst Raúl Peñaranda, delaying the adjustments until March is a strategic mistake because the government will lose the momentum provided by the legitimacy with which it begins its administration to face the reaction to sensitive measures.

“Current governmental efficiency is, paradoxically, harmful, since it gives the mistaken impression that we are not facing a critical situation. In 2026, as is logical for any government, the administration will have less strength, legitimacy and credibility,” he wrote in an opinion piece.

Throughout this month, the government’s critics also noted some contradictions with its campaign proposals, mainly regarding dependence on external financing.

Paz had insisted on the idea that it was not necessary to further indebt the country to regain stability and stated that the “house must be put in order” before seeking more loans under the motto that “when money isn’t stolen, it is enough.” However, before his inauguration he traveled to the United States to negotiate loans with the International Monetary Fund (IMF), the World Bank, the Development Bank of Latin America and the Caribbean (CAF), and other institutions.

So far, he has secured 550 million dollars from CAF and it has been reported that negotiations are underway with other organizations to access more than 9 billion dollars in the coming years.

Rodrigo Paz, presidente de Bolivia,

Rodrigo Paz, president of Bolivia,Rodrigo Paz, president of Bolivia, during his first weeks in office (Facebook/Rodrigo Paz)

This shift in decisions, which was accompanied by other conservative symbols such as the restoration of Christian elements in state offices and the exclusion of social organizations from the cabinet, was celebrated by his detractors, who during the campaign had considered Paz a leftist politician aligned with MAS.

“I am pleasantly surprised, when he won I thought the world was ending for Bolivia, but he is getting good advice and has a good team,” said Paola Castro, a stylist and mother of two children, who had voted for his opponent in the runoff seeking a radical change.

The new government has also become involved with business and agribusiness elites, whom it has included in the backbone of the Executive and entrusted with the management of issues as important as they are sensitive, such as the environment, water, and development planning; amid controversy over a suspicious conflict of interest.

However, what caused the most noise at the start of the new government were the disputes with Vice President Edmand Lara, who has publicly criticized some government decisions and has managed to focus public attention on internal disagreements, even resorting to insults: he called the president a “liar” and a “cynic.”

Un seguidor obsequia un collar

A supporter gives a necklaceA supporter gives a flower necklace to the then vice-presidential candidate during a campaign event in El Alto, Bolivia (AP Photo/Natacha Pisarenko)

Although the differences between Paz and Lara were visible during the campaign, for many analysts the vice president revealed himself in recent weeks as the president’s main opponent.

According to analyst and director of the Political Observatory at the Gabriel René Moreno Autonomous University, Daniel Valverde, this relationship is the result of “the accidental situation” of having formed a ticket at the last minute and “without having harmonized programs, without knowing each other politically or analyzing each other’s profiles.”

Paz is an experienced politician with more than two decades in public office, but who generally maintained a low national profile. Lara, in contrast, is a former police captain who became a public figure by denouncing cases of institutional corruption on social media, where his thousands of followers catapulted him as a political leader and a critical voice against the system.

Paz has managed to navigate the crisis with his “vice” by avoiding direct confrontation and trying to generate other headlines with bombastic accusations —but without precision or documentary support— of MAS’s mismanagement.

Rodrigo Paz graba un video

Rodrigo Paz records a videoRodrigo Paz records a video in an airport during the first month of his administration (Facebook/Rodrigo Paz)

For Saavedra, the Paz-Lara ticket won thanks to the vote of the “popular bloc,” understood as working-class or peasant voters who tend to support statist and redistribution-oriented policies.

Certainly, the electoral map shows that a good part of the votes that brought Paz to power came from sectors that in previous elections had voted for the left, including the coca-growing stronghold of former president Evo Morales.

“Rodrigo Paz has come to power thanks to the popular vote that has been decisive, and I believe that the measures he has taken initially have not been in balance with the popular world,” says Saavedra, warning that this can be used by his opponents to weaken governability, although he acknowledges that in recent weeks the government has made an effort to appear close to those voters.

The analyst maintains that one of Paz’s major challenges is not breaking ties with voters from the popular sectors, especially considering the adjustment measures to be undertaken in the coming months. “That would be a very big strategic mistake,” he warns.

Source: Infobae

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