The Government has requested credits of at least $1 billion from international organizations such as the International Monetary Fund (IMF), $300 million; CAF-Latin American Development Bank, $350 million; Inter-American Development Bank (IDB), $350 million and others to inject them into the economy in the face of the coronavirus pandemic or COVID-19.
The new World Bank report states that Bolivia's debt will grow by more than 10% of GDP from 57.4% to 69.2%. While the government managed to control the fiscal deficit and freeze it at 7.2% in 2019, in 2020, it should also be below 8%, but the document says the figure will reach 8%. It expects to fall to 5.6% in 2021 and 3.6% in 2022.
A measure proposed by the Chamber of Industry, Commerce, Services and Tourism of Santa Cruz (Cainco) to avoid the closure of companies and the increase of unemployment, is the urgent injection of resources to companies through liquidity lines equivalent to 20% of the Gross Domestic Product (GDP). According to data from the Ministry of Economy, Bolivia's nominal GDP amounts to $40.58 billion. With that reference, Cainco's proposal would be about $8.12 billion.
Bolivia’s economic freedom score is 42.8, making its economy the 175th freest in the 2020 Index. Its overall score has increased by 0.5 point, with higher scores for government integrity and the tax burden partially offset by drops in fiscal health and trade freedom. Bolivia is ranked 30th among 32 countries in the Americas region, and its overall score is well below the regional and world averages.
The Federation of Municipal Associations of Bolivia (FAM) proposes the Government to repeal the rule that establishes the 12% discount that the State makes to the resources of the Direct Tax on Hydrocarbons (IDH) destined to municipalities and universities, which amounts to $500 million to be used in the fight against the coronavirus and to mitigate the effects of the pandemic on the country's economy.
The fall in the international hydrocarbons price, and the impact generated by the coronavirus pandemic, will lead the Bolivian economy to a contraction of 3.4% by this 2020; according to the World Bank's report "The Economy in the Times of COVID-19". The last time Bolivia recorded a drop below zero was in 1986 when the Gross Domestic Product (GDP) fell by 2.5%.