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Updated September 1, 2021
Bolivia: An Overview
After a year of political instability and more than a decade
U.S. Ambassador for allegedly fomenting opposition to his
of tense relations with the United States, Bolivia has a new
government, charges the State Department said were false.
president who has vowed to work with the Biden
Administration. Luis Arce took office in November 2020
Figure 1. Bolivia at a Glance
after winning 55% of the vote in October 2020 elections in
which his Movement Toward Socialism (MAS) party
maintained a legislative majority. President Arce is seeking
to help Bolivia recover from the Coronavirus Disease 2019
(COVID-19) pandemic and pursuing justice for human
rights violations committed in 2019.
Background
Chronic instability, poverty, corruption, and deep ethnic
and regional cleavages have stymied Bolivia’s development
(see Figure 1). Bolivia won independence from Spain in
1825, experiencing frequent military coups and periods of
authoritarian rule for much of its history. The country
Sources: CRS, based on the International Monetary Fund (IMF),
reestablished democratic civilian rule in 1982.
Central Intelligence Agency (CIA), Instituto Nacional de Estadísticas
Bolivia’s population is among the most ethnically diverse in
(INE), and Trade Data Monitor (TDM).
South America. In the 2012 census, some 41% of the
Under Morales, Bolivia ranked “partly free” in Freedom
population self-identified as Indigenous (Quechua or
House’s Freedom in the World reports, scoring lowest on
Aymara). The rest of the population is of European, mixed
issues related to due process and judicial independence. The
European and Indigenous, or African descent. Bolivian
government launched judicial proceedings against its
Indigenous peoples benefitted from the National Revolution
opponents, dismissed hundreds of judges, and restricted
of 1952, which led to land reform and expanded suffrage.
freedom of the press. Concerns increased after the
Nevertheless, they remained underrepresented in the
Constitutional Tribunal ended constitutional limits on
political system prior to Morales’s government and
reelection in 2017, overruling a 2016 referendum in which
disproportionally affected by poverty and inequality.
voters rejected allowing Morales to run for a fourth term.
Cultivation of the coca leaf remains a contentious issue in
Bolivia’s first-round election in October 2019 was marred
Bolivia and in Bolivian-U.S. relations. Many of Bolivia’s
by allegations of fraud in the vote tabulation. The country’s
Indigenous communities consider the coca leaf sacred and
electoral agency said Morales won a narrow first-round
use it for traditional, licit purposes (the leaf also is used to
victory. The opposition rejected that result, and
make cocaine). Opposition to years of U.S.-backed forced
Organization of American States (OAS) election observers
coca eradication policies led to the rise of coca growers’
found irregularities in the process. Protesters demanded a
trade unions and a related political party, the MAS. In 2005,
new election, and then Morales’s resignation. After a police
years of protest against leaders perceived to have governed
mutiny, clashes between Morales supporters and the
on behalf of the elite led to the election of Morales,
opposition, and an army declaration urging him to step
president of the coca growers’ union and a self-identified
down, Morales resigned and sought asylum in Mexico.
person of Aymara descent.
Three individuals in line to succeed Morales also resigned.
The MAS has criticized OAS election observers for
Political Conditions
contributing to Morales’s ouster.
Morales and the MAS transformed Bolivia. Morales
decriminalized coca cultivation outside of traditional zones
Interim Government
where it had been legal, increased state control over the
Opposition Senator Jeanine Áñez, formerly second vice
economy, used natural gas revenue to expand social
president of the senate, declared herself senate president
programs, and enacted a new constitution (2009) favoring
and then interim president on November 12, 2019. Áñez, a
the rights and autonomy of indigenous peoples. Previously
conservative, sought to erase the ethnic pluralism Bolivia
underrepresented groups increased their representation at all
had embraced under Morales. Áñez issued a decree giving
levels of government. In foreign policy, Morales aligned
the military permission to participate in crowd-control
Bolivia with Hugo Chávez of Venezuela in taking a hostile
efforts and immunity from certain prosecutions for doing
stance toward the United States. In 2008, he expelled the
so. A report by a Group of Independent Experts (GIEI)
from the Inter-American Commission on Human Rights
https://crsreports.congress.gov
Bolivia: An Overview
asserted that “grave violations of human rights occurred”
“mutually respectful relationship with the Arce
under Áñez, including two massacres in November 2019.
administration” but condemning actions taken against
Áñez officials also rolled back MAS policies such as
interim government officials. Bolivia dismissed this
community-based coca control and prosecuted former MAS
statement as interventionist. U.S. officials have supported
officials for terrorism and sedition.
the 2019 OAS Election Observation Mission’s findings,
which Arce officials have disputed.
Arce Administration
After two delays due to COVID-19, a new Supreme
Each year since 2007, the U.S. President has identified
Electoral Tribunal administered elections in October 2020;
Bolivia as a major drug-producing country that failed to
election observers deemed these elections generally free
meet its obligations under international counternarcotics
and fair. Contrary to predictions, Arce avoided a runoff
agreements; such designations have triggered foreign aid
election by winning 55% of the vote. The MAS maintained
restrictions. The most recent designation occurred on
majorities in the Senate and the Chamber of Deputies.
September 16, 2020. According to the U.S. Office of
National Drug Control Policy (ONDCP), coca cultivation in
Arce is an economist who worked in Bolivia’s central bank
Bolivia totaled some 39,400 hectares in 2020, down slightly
prior to serving as minister of finance. He pledged to
from 2019 but far above the country’s legal limit of 22,000
govern in a conciliatory fashion, but clashes with regional
hectares. ONDCP asserts that potential cocaine production
leaders and within the MAS have hindered governability.
rose to 312 metric tons.
The March 2021 arrest and jailing of former Interim
President Áñez prompted concern about the Arce
U.S. bilateral assistance to Bolivia began to decline in
government’s respect for due process. Prosecutors initially
FY2007 and had ended by FY2013. Morales expelled the
cited Áñez’s role in the “coup” against Morales as the
U.S. Agency for International Development (USAID) in
justification for her detention. They added “genocide”
2013 for allegedly conspiring with the opposition; USAID
charges based on the GIEI report’s findings. The United
denied the charge. The State Department then ended its
States and other countries have called for Áñez’s rights to
antidrug programs in Bolivia due to a lack of cooperation.
be respected. They also have praised the GIEI report’s
Nevertheless, Bolivia has received U.S. support channeled
findings, expressed solidarity with the victims, and urged
through international organizations. Under an FY2020
Bolivia to implement the report’s recommendations.
waiver from drug-related foreign aid restrictions, USAID
provided $5 million to support the October 2020 elections.
Economic Conditions
In FY2021, the United States has provided $440,000 for
During Arce’s tenure as finance minister, Bolivia’s
natural disaster relief and $495,000 to help shelter
economic growth averaged almost 4.5% annually,
Venezuelan migrants in Bolivia.
according to the International Monetary Fund (IMF). The
Bolivian government channeled earnings from Bolivia’s
In response to the COVID-19 pandemic, the United States
natural gas export boom to fund social programs and wage
has provided $7 million in funds to support the Bolivian
increases that helped reduce poverty from 60% in 2006 to
health sector. In July, the Biden Administration delivered
34.5% in 2018. A December 2018 IMF report expressed
1 million COVID-19 vaccines to Bolivia.
concerns, however, about Bolivia’s rising debt, declining
reserves, and poor investment climate.
In 2020, two-way trade totaled $838 million, according to
the U.S. Department of Commerce. Bolivia’s largest
The COVID-19 pandemic, which had caused more than
exports to the United States are tin, gold, silver, and quinoa;
18,400 deaths through August 2021, weakened demand for
its primary imports from the United States are petroleum,
Bolivia’s gas exports and pushed the country into a deep
civilian aircraft and parts, and medical instruments. Some
recession. The economy shrank by 7.7% in 2020, but the
Bolivian products enter the United States duty free under
IMF predicts growth of 5.5% in 2021. Poverty increased,
the Generalized System of Preferences program.
but the government lacked funding for social programs,
aside from cash transfers to the poor paid for with a World
Despite differences on many geopolitical issues, the Arce
Bank loan. A wealth tax enacted in December 2020 has
government has pledged to work with the Biden
raised some revenue, but the Arce government is seeking
Administration. At the same time, the Bolivian government
multilateral debt relief and foreign investment. International
has pursued closer relations with China and Russia. Arce
financial institutions likely would condition debt relief on
also reestablished relations with Cuba, Venezuela, and Iran.
fiscal adjustments, which have generated protests and
impeded governability elsewhere in the region. As of
Issues for Congress
September 1, 2021, the Bolivian government had fully
Congress may seek to influence the Biden Administration’s
vaccinated 23% of the population, according to Johns
policy toward Bolivia through the appropriations process,
Hopkins University.
oversight hearings, legislation, or letters. Some Members of
Congress have expressed hope for improved relations;
U.S.-Bolivian Relations
others have expressed concerns about the socialist
U.S.-Bolivian relations are likely to remain challenging.
government in Bolivia. H.Rept. 117-84 accompanying H.R.
The Trump Administration sent a high-level delegation to
4373 urged the Secretary of State to solicit information
attend Arce’s inauguration and vowed to work together on
from “independent, internationally recognized experts”
issues of shared concern. In March 2021, Secretary of State
regarding the legality of Bolivia’s 2019 elections, the
Antony Blinken issued a statement reiterating a desire for a
https://crsreports.congress.gov
Bolivia: An Overview
OAS’s role in the elections, and investigations into human
Clare Ribando Seelke, Specialist in Latin American
rights violations during and after the elections.
Affairs
IF11325
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