The performance of the economy reflected through the Global Index of Economic Activity – IGAE, in the first two months (January and February) of 2020 grew by 2.1% compared to the similar period of the previous year. The activities that influenced in this behaviour were the Manufacturing Industry with 0.5% and Agriculture, (includes the livestock, forestry, hunting and fishing sectors) with 0.4% growing in 3.1% and 3.6% respectively; on the other hand, the extractive activities (Crude Oil and Natural Gas and Metallic and Non-Metallic Minerals) presented adverse incidence.
Frosts affected about 80% of Postrervalle’s production and 50% of that produced in the municipality of Quirusillas. These areas have potatoes, tomatoes, pumpkins and other vegetables are grown for consumption in the department, between 60%, and 70% of the consumption of Santa Cruz. There are 40,000 hectares cultivated.
The Confederation of Private Businesses of Bolivia (CEPB) estimated that to generate liquidity conditions the State would have to inject $ 4 billion with external financing and another $ 4 billion from domestic sources to meet the challenges of reactivation and employment generation.
YPFB expects to resume ethanol withdrawal between June and December, and projects to demand 52 million litres of the additive. A technical committee will evaluate the contract, and the mills will negotiate with representatives from four ministries.
Each year, Bolivia produces about a thousand tons of corn. Santa Cruz has 57%, Tarija 16%, Cochabamba and Sucre 10% each, according to data. It estimates that the consumption of corn in Bolivia is between 17 and 60 kilos per person per year and is the basis for the production of animal feed. The average corn crop yield ranges from 2.08 to 2.72 tons per hectare. The incursion of genetically modified seeds will put at risk the subsistence of at least 28 native varieties widely used in the production of chicha, pasqalla, ch’uspillo, api and others.
The effects of the coronavirus also hit the financial system. The Association of Private Banks of Bolivia (Asoban) reports an 8% reduction in profitability as of April, while liquidity, affected by the deferral of payments, is a huge challenge to meet the demand for credit for economic recovery.
According to data from the National Institute of Statistics (INE), the value of exports to the first quarter of 2020 reached $7.6 million, while in the similar period last year was at $2.5 million. We are working in coordination with the National Service of Agricultural Security and Food Safety (SENASAG) to export meat to the markets of Russia and Chile, as Bolivia has an exportable surplus of at least 50 thousand tons per year.
According to data from the National Institute of Statistics (INE), in February 2020, the last date for registration, Cochabamba led the way in the number of building permits with 70, followed by Trinidad (Beni) with 41, Santa Cruz (38), Potosí (35), La Paz (25) and Tarija (15). Meanwhile, activity in Sucre and Oruro came to a halt. Thus, building permits in Bolivia decreased from 572 to only 12 in March.
The fall in the price of WTI oil and its possible stabilization around $30 a barrel reveals a challenging scenario: investments have to be re-evaluated, in some cases postponed in the hope of a better scene and others cancelled. It is a severe blow for companies in the sector, which are now working hard to achieve sustainability. Oil companies are cutting their budgets in almost all countries of the world due to the high tax system, in Bolivia taxes to the sector reached 50%.
A study by the Franz Tamayo University released in April had projected an average loss of Bs 6.2 billion ($890 mn), equivalent to 38% by 2020. As quarantine extended, the situation became more serious; the projected losses deepened to Bs 7.6 billion ($1.09 bn), 52% of what predicted for this year before the pandemic. It expects that the reactivation of tourism in Bolivia will not come until mid-2021.