In February 2020, Bolivian exports reached US$1.4 billion, 8% more than the value recorded in the same period in 2019, and the volume exported grew by 5%. The cost of foreign sales of non-traditional products registered an increase of 6%, while in volume dropped 4%. The growth of the jewellery, sugar and sunflower sectors stands out. Hydrocarbon and mineral exports increased 9% in value and 6% in volume concerning February 2019.
The department of Santa Cruz is the leading market for coca leaf due to the consumption of more than 9,000 metric tons, according to 2018 data from the United Nations Office on Drugs and Crime (UNODC). Thirty-seven per cent of the national coca leaf production (24,278 metric tons) goes to the region of Santa Cruz. The pound of legal coca leaf for chewing at the Santa Cruz market usually costs Bs 50, but now, in times of quarantine, it is scarce, and the price of the pound varies between Bs 120, 150, 180 and Bs 200.
With the price of oil at $30 a barrel, the Vaca Muerta gas fields in Argentina and the Pre-Sal in Brazil are unviable. Faced with a drop in production in Argentina, due to the characteristics of the shale gas extracted from Vaca Muerta, an addendum could be rushed with that country, because the current one is very complacent and disadvantageous for Bolivia. The state will sell gas to Brazil and Argentina for $3 per BTU, the great advantage of the country is the investment in pipelines that it has until these two markets.
When the quarantine ends on April 15, the manufacturing industry will begin to operate with a loss of Bs 121.8 million ($17.5 mn). The National Chamber of Industry (CNI) calculated that during the emergency period, the industrial activity loses Bs 4.8 million ($700,000) per day. Since the sanitary emergency, only 17% of the industries are operating with relative normality; the rest are paralyzed or working at the minimum of their installed capacity.
The Bolivian Highway Administration (ABC) may directly contract works for an amount of up to 58 million Bolivians ($8.3 mn), to meet contingencies caused by rains and other natural disasters. The measure will be in force for seven months, according to Supreme Decree 4208.
The World Bank started to provide financial and technical support Bolivia face coronavirus disease, under an emergency component of an active financing ($300 mn), aimed at the strengthening of country’s health system. The support, totaling US$ 20 million, is focused on attending the immediate and short-term priorities of the health system, including technical assistance to counteract the growth of the virus outbreak in the country.
We are reducing our 2020 zinc, silver, tin and lead mine production forecasts for Bolivia (between 1.5-3.0% y-o-y growth to between a 1.0-2.4% y-o-y contraction) on the back of announcements by miners to suspend operations in compliance with government measures.
Pork production has decreased by 67% since the emergency began. Also, there has been a drastic drop in producer prices, reduced by 50%. The production dropped from 90,000 tons of meat per month to less than 30,000. The cost of production is between Bs 9 and Bs 10 per kilogram, but the market is only paying Bs 5. Most producers have chosen to sell directly to the consumer by phone orders, at Bs 15.
According to the National Chamber of Industries, 97% of the country’s factories have stopped their operations. Thirty-five thousand factories are operating in Bolivia, but only 1,300 have been working since the quarantine took place. This group includes micro and small production units.
The National Customs Office anticipated that it would collect 30% of the annual revenue expected for 2020, due to the health emergency caused by the coronavirus. Bolivia will feel the effect in the first half of the year.