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LA PAZ.- Popular protests returned to the streets of Bolivia fueled by an economic crisis that led in the last hours to a military movement that keeps the future of President Luis Arce uncertain. and the hegemony that the ruling party capitalized on for almost two decades.
Crowds of street vendors, who make up the vast informal workforce of the South American country They recently marched almost 100 kilometers from the plains to La Paz to demand an end to the shortage of fuel and dollars -which many Bolivians use to purchase goods or as a savings currency- and against the rise in the price of food.
As Minister of Economy of former President Evo Morales (2006-2019), Arce captained the so-called “Bolivian miracle” thanks to high gas prices, but now faces difficulties in weathering the storm and lost control of the Legislative Assembly after the fracture of the official Movement to Socialism (MAS).
Much of the crisis is due to the fight between Arce and Morales for the future of the MAS before the 2025 general elections.
These are some of the reasons for the current social crisis that resulted in repeated protests and road blockades until the emergence of the military side led by General Juan José Zúñiga.
The crisis in the MAS erupted in 2019 when Morales – the first indigenous president in the country’s history – forced a third re-election prohibited by the constitution and rejected by a popular referendum. He resigned from the presidency in the middle of a social outbreak that left 36 dead after elections considered fraudulent in 2019 and sought asylum first in Mexico and then in Argentina.
After an interim government that the MAS considers illegal, the party returned to power in 2020 with Arce, but the economy had been hurt after the Covid-19 pandemic and Morales was no longer the undisputed leader of that force.
Arce took the reins and it didn’t take long for friction to appear when Morales announced in 2023 his intention to run in 2025. Arce has the same expectations and the backing of the Constitution to seek reelection.
“Deep down, people remember the Evo period as a time of growth and success”said Diego Von Vacano, an expert on Bolivian politics at Texas A&M University. “This economic crisis is a turning point that is causing more and more officials to abandon ship and join Morales’ side.”
Both Morales and Arce have held their own party congress to discuss the future of the MAS. Last week, Morales attracted tens of thousands of loyalists to Cochabamba, southeast of La Paz. “We are going to win the elections and we are going to win to save Bolivia”he said triumphantly in a stadium full of whipalas, the brightly colored flags that represent the country’s indigenous people.
President Arce denies the legitimacy of Morales’ campaign by pointing to a 2023 Constitutional Court ruling that bars him from running, but legal experts say the issue is not so clear.
The Morales faction has blocked Arce’s initiatives in the Legislature and several loans that would help the economy are pending legislative approval.
Arce accuses Morales of an “economic boycott” and colluding with the minority center and right-wing opposition to “shorten” his mandate. Morales, in turn, accuses Arce of deepening the economic crisis.
Morales had to govern with good prices for raw materials and extraordinary income from gas exports after the nationalization of hydrocarbons in 2006. The liberal reforms of the 1990s had positioned the country as an energy power and Bolivia went from being a low-income country to a middle-income country, according to the World Bank. Extreme poverty fell to 15%, roads and cable cars were built and cities expanded.
“A consumer bubble was created”said the professor of Economics at the Catholic University, Gonzalo Chávez. However, gasoline production did not cover local consumption and the State had to import more fuel each year.
According to Morales and Arce, the success of the model was based on the redistribution of the surplus from gas exports that began to decline in 2014. “But from 6.6 billion dollars for gas exports to Brazil and Argentina, income fell to 2.1 billion in 2023”explained Chavez. Mining is also not going through a good moment and the agro-industry is not generating the income it used to.
The shortage of dollars has set off alarms. Until a year ago, the US currency circulated freely in the country; industrialized products were imported with the dollar and cars and homes were sold. But the government needs $2 billion each year to import gasoline and diesel, which it sells at half price, and export revenues have declined.
Importers allege that they must obtain US currency in the parallel market at a higher price, which makes the products more expensive. “We ate the savings and now we are scraping the pot,” Chávez said.
Arce recently said that gasoline and diesel production covered half of domestic consumption in 2014 and that Now 86% of diesel and 56% of gasoline are imported “due to a lack of investment in exploration and the exhaustion of fields.” Transporters are carrying out recurring protests due to the lack of fuel.
For their part, housewives complain about the high prices of some foods. The government has attributed the rise to climatic factors and smuggling to Peru and Argentina.
The Minister of Economy, Marcelo Montenegro, has denied that the country is going through an economic crisis. “There is growth (3% of GDP in 2023) and inflation is controlled (2.12% in 2023). Opponents “seek to take over the feeling of crisis for political reasons”, said. The government has not made adjustments between income and expenses, according to economists.
Most analysts agree that the economic and political model of the MAS is exhausted. The agitation in the streets favors the traditional parties, which are trying to raise their heads and see themselves with a better chance of defeating the MAS at the polls. But the opposition is divided and one of its main leaders, the governor of Santa Cruz Luis Fernando Camachois imprisoned for the 2019 anti-government protests.
“By the year 2025… many alternatives appear but there is very little that unites them”said Fernando Mayorga, a sociologist at the state University of Cochabamba. “The opposition has more opportunities due to the existing division in the MAS and the exhaustion of the figure of Evo Morales” but this will depend on whether it knows how to take advantage of the political opportunity, he added.
Faced with the crisis of the ruling party, a dozen new leaders have emerged and are seeking to gain space, but few speak of unity.
“Bolivia’s problem is not about searching for a leader but rather a new vision of the country based on a constituent social pact. “The elections will not solve the structural problems,” said political analyst Paul Coca.
“Unfortunately the people are asleep, but these people are going to begin to rise,” said Roberto Ríos Ibáñez, general secretary of the Confederation of Artisans and Merchants of Bolivia, during the recent march to La Paz.
By Carlos Valdez
AP Agency
AP
