Bolivia: An Overview

Bolivia: An Overview

Updated May 16, 2022
Bolivia: An Overview
After experiencing instability following the ouster of
Bolivia with Hugo Chávez of Venezuela in taking a hostile
populist President Evo Morales (2005-2019), Bolivia
stance toward the United States. In 2008, he expelled the
remains politically polarized but has begun to recover
U.S. Ambassador for allegedly fomenting opposition to his
economically under President Luis Arce. Arce, Morales’
government, charges the State Department said were false.
former finance minister, took office in November 2020
after a first-round victory in October 2020 elections in
Figure 1. Bolivia at a Glance
which his Movement Toward Socialism (MAS) party
maintained a legislative majority. High natural gas prices
related to the Ukraine conflict have helped Bolivia’s
economy recover from the Coronavirus Disease 2019
(COVID-19) pandemic. U.S. relations with Bolivia remain
challenging, in part because of Bolivia’s 2008 expulsion of
the U.S. Ambassador and U.S. law enforcement and
development agencies.
Background
Chronic instability, poverty, corruption, and deep ethnic
and regional cleavages have stymied Bolivia’s
development. Bolivia won independence from Spain in

Sources: CRS, based on the International Monetary Fund (IMF),
1825, experiencing frequent military coups and periods of
Central Intelligence Agency (CIA), Instituto Nacional de Estadísticas
authoritarian rule for much of its history. The country
(INE), and Trade Data Monitor (TDM).
reestablished democratic civilian rule in 1982.
Under Morales, the government launched judicial
Bolivia’s population is among the most ethnically diverse in
proceedings against its opponents, dismissed hundreds of
South America. In the 2012 census, some 41% of the
judges, and restricted freedom of the press. Concerns
population self-identified as Indigenous (Quechua or
increased after the Constitutional Tribunal ended
Aymara). The rest of the population is of European, mixed
constitutional limits on reelection in 2017, overruling a
European and Indigenous, or African descent. Bolivian
2016 referendum in which voters rejected allowing Morales
Indigenous peoples benefitted from the National Revolution
to run for a fourth term.
of 1952, which led to land reform and expanded suffrage.
Nevertheless, they remained underrepresented in the
In October 2019, allegations of fraud in vote tabulation
political system prior to Morales’s government and
marred Bolivia’s first-round election. The electoral agency
continue to be disproportionally affected by poverty.
said Morales won a narrow first-round victory; the
opposition rejected that result. Organization of American
Cultivation of the coca leaf remains a contentious issue in
States (OAS) election observers found irregularities in the
Bolivia and in Bolivian-U.S. relations. Many of Bolivia’s
process. Protesters demanded a new election, and then
Indigenous communities consider the coca leaf sacred and
Morales’s resignation. After a police mutiny and an army
use it for traditional, licit purposes (the leaf also is used to
declaration urging him to step down, Morales resigned and
produce cocaine). Opposition to years of U.S.-backed
sought asylum. Three officials in line to succeed Morales
forced coca eradication policies led to the rise of coca
also resigned. The MAS maintains that the OAS observers
growers’ trade unions and a related political party, the
contributed to Morales’s ouster.
MAS. In 2005, years of protest against those policies led to
the election of Morales, president of the coca growers’
Interim Government
union and a self-identified person of Aymara descent.
Opposition Senator Jeanine Áñez, formerly second vice
president of the senate, declared herself senate president
Political Conditions
and then interim president on November 12, 2019. Áñez, a
Morales and the MAS transformed Bolivia. Morales
conservative, sought to erase the ethnic pluralism Bolivia
decriminalized coca cultivation outside of traditional zones
had embraced under Morales. Áñez issued a decree giving
where it had been legal, increased state control over the
the military permission to participate in crowd-control
economy, used natural gas revenue to expand social
efforts and immunity from certain prosecutions for doing
programs, and enacted a new constitution (2009) protecting
so. A report by a Group of Independent Experts (GIEI)
the rights and autonomy of indigenous peoples. Previously
from the Inter-American Commission on Human Rights
underrepresented groups increased their representation at all
asserted that “grave violations of human rights occurred”
levels of government. In foreign policy, Morales aligned
under Áñez, including two massacres in November 2019.
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Bolivia: An Overview
Áñez officials also rolled back MAS policies such as
U.S.-Bolivian Relations
community-based coca control and prosecuted former MAS
U.S.-Bolivian relations are likely to remain challenging. In
officials for terrorism and sedition.
March 2021, Secretary of State Antony Blinken issued a
statement asserting a desire for a “mutually respectful
Arce Administration
relationship with the Arce administration” but condemning
After two delays due to COVID-19, a new Supreme
actions taken against interim government officials. The
Electoral Tribunal administered elections in October 2020;
Bolivian government dismissed this statement as
election observers deemed these elections generally free
interventionist. The Biden Administration did not invite
and fair. Contrary to predictions, Luis Arce avoided a
Bolivia to its December 2021 Summit for Democracy.
runoff election by winning 55% of the vote. President Arce
is an economist who worked in Bolivia’s central bank prior
Each year since 2007, the U.S. President has identified
to serving as finance minister. The MAS maintained
Bolivia as a major drug-producing country that failed to
majorities in the Senate and the Chamber of Deputies.
meet its obligations under international counternarcotics
agreements; such designations have triggered foreign aid
President Arce pledged to govern in a conciliatory fashion,
restrictions. The most recent designation occurred on
but clashes with regional leaders and within the MAS have
September 15, 2021. According to the U.S. Office of
hindered governability during his tenure. The MAS lost
National Drug Control Policy (ONDCP), coca cultivation in
several mayoral and gubernatorial contests in 2021
Bolivia totaled some 39,400 hectares in 2020, down slightly
subnational elections. Arce has yet to publish detailed plans
from 2019 but far above the country’s legal limit of 22,000
for handling public security and other public policy
hectares. ONDCP asserts that potential cocaine production
challenges. Observers predict more intraparty conflict will
rose to 312 metric tons. In January 2022, Bolivia arrested
occur once current fiscal stimulus ends.
Maximiliano Dávila-Pérez, a former drug czar indicted in
the United States on drug and weapons charges. It is yet
As during Morales and Añez’s tenures, Bolivia ranked
unclear whether Bolivia will extradite him.
“partly free” in Freedom House’s 2022 Freedom in the
World report, scoring lowest on issues related to due
U.S. bilateral assistance to Bolivia began to decline in
process and judicial independence. The March 2021 arrest,
FY2007 and ended by FY2013. Morales expelled the U.S.
pre-trial detention, and trial of former Interim President
Agency for International Development (USAID) in 2013
Áñez for assuming the presidency unconstitutionally has
for allegedly conspiring with the opposition; USAID denied
renewed concern about Bolivia’s politicized justice system.
the charge. The State Department then ended its antidrug
U.S. officials have called for Áñez and other former
programs in Bolivia due to a lack of cooperation.
officials’ rights to be respected as their trials continue. At
Nevertheless, Bolivia has received U.S. support channeled
the same time, they also have praised the GIEI report’s
through international organizations. Under an FY2020
findings regarding rights abuses under Áñez, expressed
waiver from drug-related foreign aid restrictions, USAID
solidarity with the victims, and urged implementation of the
provided $5 million to support the October 2020 elections.
report’s recommendations.
In FY2021, the United States has provided $440,000 for
natural disaster relief and $495,000 to help shelter
Economic Conditions
Venezuelan migrants in Bolivia. The United States has
Bolivia’s economic growth averaged almost 4.7% annually
provided $10 million to support the Bolivian health sector
from 2005-2019, according to the International Monetary
and delivered 4.5 million COVID-19 vaccines.
Fund (IMF). The Bolivian government channeled earnings
from Bolivia’s natural gas export boom to fund social
Bolivia has good relations with China and Russia. Bolivia
programs and wage increases that helped reduce poverty
has abstained from U.N. votes regarding Russia’s invasion
from 60% in 2006 to 37.2% in 2019.
of Ukraine. Bolivia has strong relations with Cuba, Iran,
and the Maduro government in Venezuela.
The COVID-19 pandemic, which had caused nearly 22,000
deaths through mid-May 2022, weakened demand for
Issues for Congress
Bolivia’s gas exports and led to an extended lockdown that
In the 117th Congress, some Members of Congress have
decreased economic output. Those factors contributed to an
expressed hope for improved relations; others have
economic contraction of 8.7% in 2020, according to the
expressed concerns about some antidemocratic actions by
IMF. Challenges delivering vaccines to rural areas and
the Bolivian government. The explanatory statement
vaccine hesitancy have hindered vaccination efforts. As of
accompanying the FY2022 Consolidated Appropriations
May 16, 2022, 50.9% of Bolivians were fully vaccinated,
Act (P.L. 117-103) urges the Secretary of State to solicit
according to Johns Hopkins University.
information from “independent, internationally recognized
experts” regarding the legality of Bolivia’s 2019 elections,
High energy and mining prices are supporting economic
the OAS’s role in the elections, and investigations into
recovery. The IMF estimates Bolivia’s economy grew by
human rights violations during and after the elections.
6.1% in 2021 and could grow 3.8% in 2022. Nevertheless,
an April 2022 World Bank report warns that declining
Clare Ribando Seelke, Specialist in Latin American
reserves, weak private and foreign investment, and inflation
Affairs
could limit the government’s ability to help the poor cope
IF11325
with food insecurity and learning losses from the pandemic.
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Bolivia: An Overview

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