The president of the National Chamber of Industries (CNI), Ibo Blazicevic, called for freezing the national minimum wage in 2020 and only negotiating the increase in the basic level, based on inflation recorded in the current period. He added that Bolivia has the fifth-highest salary in the region; it is a high cost for labour with very little productivity.
Profits from State oil company YPFB drop from $1.3 billion in 2014 to $52 million in 2018, according to data from the company and the Economic Ministry. Executed investments also reduced from $2.1 billion in 2014 to $313.5 million in 2018.
Bolivia could keep open the Brazilian market for Bolivian natural gas for the next 3 or four years. The contract with Brazil should finish at the end of this year. The Hydrocarbons Minister, Victor Hugo Zamora, said that they expect to signed an addendum to the contract in the next 70 days that will define the shipments to the gas still not taken by Brazil (around 12 months) and also it guarantees an income of around $5 billion for Bolivia.
The Central Bank of Bolivia (BCB) launched a Christmas Bond, available from December 16, 2019 to January 31, 2020. This financial instrument offers an interest rate of 4.5% per annum over a period of 119 days (four months).
Bolivia’s President, Jeanine Añez, named economist Guillermo Aponte Reyes as interim president of Bolivia’s Central Bank (BCB) and also nominated four interim directors: Luis Armando Pinell Siles, Walter Morales Carrasco, Jose Gabriel Espinoza Yañez and Roger Alejandro Vargas Rivero. Aponte Pensions Superintendent during the second government of Gonzalo Sanchez de Lozada.
Standard & Poor’s put Bolivia’s rating to BB- and revised its outlook to negative. Citing “risks to external and debt positions”, S&P said there was at least a one in three chance of a downgrade in the next six to 18 months, amid political uncertainty, poor GDP growth prospects and further erosion of fiscal metrics.
The illegal trade in pesticides at national level generates an estimated $45.3 million in the informal market, almost 14.3% of the supply in the domestic market, according to data from the Bolivian Institute for Foreign Trade (IBCE) and the Association of Suppliers of Agricultural Supplies (APIA). The legal market trades 96,717 metric tons, with a value of $343 million.
Bolivia’s traditional exports fell 24% in volume and 6% in value between January and October 2019, reported the Bolivian Institute of Foreign Trade (IBCE). Traditional exports represent 79% of Bolivia’s total exports and natural gas is the main product, whose exports fell 25% in volume and 18% in value. Regarding non-traditional exports that include products such as soybean, there was an increase of 17% in volume but a drop of 2% in value.
Bolivia’s government named Herland Soliz Montenegro as new CEO for state oil company YPFB. Soliz replaces Jose Luis Rivero who left the office after announced that YPFB is in economic bankruptcy, although he retracted later on this statement. However, oil and gas experts warned that YPFB is going through economic difficulties as a result of a continuing expansion on spending and negative results in exploration and unprofitable industrialisation projects.
2019 has been a particularly difficult year for Bolivia’s hydrocarbon sector. There was a drop in about 24% of gas production compared to 2014; reserves fell to 7.3 trillion cubic feet (TCF); Brazil fined Bolivia with $133 million; and the signed addendum to the contract with Argentina involves a 40% reduction in export volumes compared to the initial agreement, which means a revenue drop of Bs.6.757 million ($977.5 million), according to national and regional Government sources.