The national economy registered negative inflation in December 2019 and in January and February 2020, with prices recovering in March and April, but again falling in May, and starting to rise in June. Since November 2019, the country experiences political uncertainty, a slowdown in the economy, which foresees a recession of 5.9% of the gross domestic product by 2020.
On June 30, the Gestora Pública, which administers Bolivian’s pension funds, filed a criminal complaint against former Economy Minister Luis Arce for the million-dollar purchase of non-existent software from the company Sysde and for a contract for other software with Heinsohn, which included the rental of its use for 40 years.
The airline’s financial statements as of December 31, 2019, reflect a loss of $28 million, another $10 million was charged directly to the Accrual Account, with a combined effect of $40 million of decrease in the company’s equity. With the pandemic, the situation is more critical; the company has stopped receiving $60 million.
Preliminary data from the National Institute of Statistics (INE) reflect a 5.6% contraction in the Bolivian economy during the cumulative period from January to April 2020. The World Bank predicted that the Bolivian economy would contract by 5.9% this year due to the effect of the pandemic, and the INE data seems to confirm this trend.
According to the National Institute of Statistics (INE), until May, external sales of minerals reached $482.6 million, the figure represents a fall of 47.2% over the same period in 2019, which reached $913 million. The main products that decreased in exports were zinc in 51.6%, silver in 36.7% and lead in 48.4%.
Mining exports fell 47.2%
The country’s private universities record a 35% dropout rate in the first semester, due to the impossibility of maintaining internet payments for virtual classes. The National Association of Private Universities (ANUP) reports that 29 of the 36 affiliates had to take out bank loans to pay salaries, virtual classroom licenses and other expenses. Failure to comply with these obligations would mean stopping the training of more than 200,000 university students in the country.
The stoppage of productive activities due to the coronavirus pandemic will cause the closure of 2.7 million formal businesses in Latin America, most of them micro-businesses, which will imply the destruction of 8.5 million jobs, ECLAC said Thursday. COVID-19 will cause the worst recession in history in Latin America. The contraction of regional GDP expects to reach 5.3% in 2020, and the poverty rate will grow up from 30.3% to 34.7% of the population.
Tecnopor SA, one of the country’s leading manufacturers of expanded polystyrene and pre-stressed beams, dismissed 52 of 72 workers from its La Paz branch. The company took this action because its sales fell by 75% due to the coronavirus pandemic.
$19 million will be invested and financed by the International Monetary Fund (IMF). In the next six months, at least 11,000 people expected to be inserted in the formal sector of the economy. The government will subsidize salaries for six months.
The national government has decided to approve the rescue plan for Bolivia’s state-owned airline, BoA, and is managing the delivery of $25 million of the $50 million the airline needs to overcome the economic crisis