The Republic of Bolivia is a landlocked country in central South America. It is bordered by Brazil on the north and east, Paraguay and Argentina on the south, and Chile and Peru on the west.
República de Bolivia
|National motto: Firme y Feliz por la Unión
Spanish, Quechua, Aymara
Guarani, various indigenous dialects
La Paz, Sucre1
- % water
- Total (July 2000)
August 6, 1825
|Bolivianos, el hado propicio
|1 La Paz is the seat of government; Sucre, the legal capital
Main article: History of Bolivia
The Andean region probably has been inhabited for some 20,000 years. Beginning about the 2nd century B.C., the Tiwanaku culture developed at the southern end of Lake Titikaka. This culture, centered around and named for the great city of Tiwanaku, developed advanced architectural and agricultural techniques before it disappeared around 1200 A.D., probably because of extended drought. Roughly contemporaneous with the Tiwanakan culture, the Moxos in the eastern lowlands and the Mollos north of present-day La Paz also developed advanced agricultural societies that had dissipated by the 13th century A.D. In about 1450, the Quechua-speaking Incas entered the area of modern highland Bolivia and added it to their empire. They controlled the area until the Spanish conquest in 1525.
During most of the Spanish colonial period, this territory was called "Upper Peru" or "Charcas" and was under the authority of the Viceroy of Lima. Local government came from the Audiencia de Charcas located in Chuquisaca (La Plata--modern Sucre). Bolivian silver mines produced much of the Spanish empire's wealth, and Potosí, site of the famed Cerro Rico--"Rich Mountain"--was, for many years, the largest city in the Western Hemisphere. A steady stream of enslaved Indians served as labor force. As Spanish royal authority weakened during the Napoleonic wars, sentiment against colonial rule grew.
The Republic and Economic Instability (1809)
Independence was proclaimed in 1809, but 16 years of struggle followed before the establishment of the republic, named for Simón Bolívar, on August 6, 1825 (see Bolivian War of Independence ).
Independence did not bring stability. For nearly 60 years, coups and short-lived constitutions dominated Bolivian politics. Bolivia's weakness was demonstrated during the War of the Pacific (1879-83), when it lost its seacoast, and the adjoining rich nitrate fields, together with the port of Antofagasta, to Chile.
An increase in the world price of silver brought Bolivia a measure of relative prosperity and political stability in the late 1800s. During the early part of the 20th century, tin replaced silver as the country's most important source of wealth. A succession of governments controlled by the economic and social elites followed laissez-faire capitalist policies through the first third of the century.
Living conditions of the indigenous peoples, who constituted most of the population, remained deplorable. Forced to work under primitive conditions in the mines and in nearly feudal status on large estates, they were denied access to education, economic opportunity, or political participation. Bolivia's defeat by Paraguay in the Chaco War (1932-35) marked a turning point. Great loss of life and territory discredited the traditional ruling classes, while service in the army produced stirrings of political awareness among the indigenous people. From the end of the Chaco War until the 1952 revolution, the emergence of contending ideologies and the demands of new groups convulsed Bolivian politics.
Rise of the Nationalist Revolutionary Movement (1951)
The Nationalist Revolutionary Movement (MNR) emerged as a broadly based party. Denied its victory in the 1951 presidential elections, the MNR led the successful 1952 revolution. Under President Víctor Paz Estenssoro, the MNR introduced universal adult suffrage, carried out a sweeping land reform, promoted rural education, and nationalized the country's largest tin mines.
Twelve years of tumultuous rule left the MNR divided. In 1964, a military junta overthrew President Paz Estenssoro at the outset of his third term. The 1969 death of President René Barrientos Ortuño, a former member of the junta elected President in 1966, led to a succession of weak governments. Alarmed by public disorder, the military, the MNR, and others installed Col. (later General) Hugo Banzer Suárez as President in 1971. Banzer ruled with MNR support from 1971 to 1974. Then, impatient with schisms in the coalition, he replaced civilians with members of the armed forces and suspended political activities. The economy grew impressively during most of Banzer's presidency, but human rights violations and eventual fiscal crises undercut his support. He was forced to call elections in 1978, and Bolivia again entered a period of political turmoil.
Military Governments: García Meza and Siles Zuazo (1978)
Elections in 1978, 1979, and 1980 were inconclusive and marked by fraud. There were coups, counter-coups, and caretaker governments. In 1980, Gen. Luis García Meza Tejada carried out a ruthless and violent coup. His government was notorious for human rights abuses, narcotics trafficking, and economic mismanagement. Later convicted in absentia for crimes, including murder, García Meza was extradited from Brazil and began serving a 30-year sentence in 1995.
After a military rebellion forced out García Meza in 1981, three other military governments in 14 months struggled with Bolivia's growing problems. Unrest forced the military to convoke the Congress elected in 1980 and allow it to choose a new chief executive. In October 1982, 22 years after the end of his first term of office (1956-60), Hernán Siles Zuazo again became President. Severe social tension, exacerbated by economic mismanagement and weak leadership, forced him to call early elections and relinquish power a year before the end of his constitutional term.
Civil Government: Paz Estenssoro and Paz Zamora (1985)
In the 1985 elections, the Nationalist Democratic Action Party (ADN) of Gen. Banzer won a plurality of the popular vote (33%), followed by former President Paz Estenssoro's MNR (30%) and former Vice President Jaime Paz Zamora's Movement of the Revolutionary Left (MIR, at 10%). But in the congressional run-off, the MIR sided with MNR, and Paz Estenssoro was chosen for the fourth time as president. When he took office in 1985, he faced a staggering economic crisis. Economic output and exports had been declining for several years. Hyperinflation had reached an annual rate of 24,000%. Social unrest, chronic strikes, and unchecked drug trafficking were widespread.
In 4 years, Paz Estenssoro's administration achieved economic and social stability. The military stayed out of politics, and all major political parties publicly and institutionally committed themselves to democracy. Human rights violations, which badly tainted some governments earlier in the decade, were not a problem. However, Paz Estenssoro's remarkable accomplishments were not won without sacrifice. The collapse of tin prices in October 1985, coming just as the government was moving to reassert its control of the mismanaged state mining enterprise, forced the government to lay off over 20,000 miners. The highly successful shock treatment that restored Bolivia's financial system also led to some unrest and temporary social dislocation.
Although the MNR list headed by Gonzalo Sánchez de Lozada finished first in the 1989 elections (23%), no candidate received a majority of popular votes and so in accordance with the constitution, a congressional vote determined who would be president. The Patriotic Accord (AP) coalition between Gen. Banzer's ADN and Jaime Paz Zamora's MIR, the second- and third-place finishers (at 22.7% and 19.6%, respectively), won out. Paz Zamora assumed the presidency and the MIR took half the ministries. Banzer's center-right ADN took control of the National Political Council (CONAP) and the other ministries.
Paz Zamora was a moderate, center-left president whose political pragmatism in office outweighed his Marxist origins. Having seen the destructive hyperinflation of the Siles Zuazo Administration, he continued the neoliberal economic reforms begun by Paz Estenssoro. Paz Zamora took a fairly hard line against domestic terrorism, personally ordering the December 1990 attack on terrorists of the Nestor Paz Zamora Committee (CNPZ — named after his brother who died in the 1970 Teoponte insurgency) and authorizing the early 1992 crackdown against the Tupac Katari Guerrilla Army (EGTK).
Paz Zamora's government was less decisive against narcotics trafficking. It had a mixed record in confronting narco-traffickers and made little progress in confronting illegal coca cultivation. In the mid-1990s, Paz Zamora and his government were investigated by the Bolivian Congress for ties to narco-traffickers. The 1993 elections continued the tradition of open, honest elections and peaceful democratic transitions of power. The MNR defeated the ADN/MIR coalition by a 33% to 20% margin, and the MNR's Gonzalo "Goni" Sánchez de Lozada was selected as president by an MNR/MBL/UCS coalition in the Congress.
Sánchez de Lozada and Benzer: Neoliberalizing the Economy (1993)
Sánchez de Lozada pursued an aggressive economic and social reform agenda. He relied heavily on successful entrepreneurs-turned-politicians like himself and on fellow veterans of the Paz Estenssoro administration (during which Sánchez de Lozada was Minister for Planning). The most dramatic change undertaken by the Sánchez de Lozada government was the "capitalization" program, under which investors, typically foreign, acquired 50% ownership and management control of public enterprises, such as the state oil corporation, telecommunications system, airlines, railroads, and electric utilities in return for agreed upon capital investments. The reforms and economic restructuring were strongly opposed by certain segments of society, which instigated frequent and sometimes violent protests, particularly in La Paz and the Chapare coca-growing region, from 1994 through 1996. The Sánchez de Lozada government pursued a policy of offering monetary compensation for voluntary eradication of illegal coca by its growers in the Chapare region. The policy produced little net reduction in coca, and in the mid-1990s Bolivia accounted for about one-third of the world's coca going into cocaine.
In the 1997 elections, Gen. Hugo Banzer, leader of the ADN, won 22% of the vote, while the MNR candidate won 18%. Gen. Banzer formed a coalition of the ADN, MIR, UCS, and CONDEPA parties which held a majority of seats in the Bolivian Congress. The Congress elected him as president and he was inaugurated on August 6, 1997.
The Banzer government basically continued the free market and privatization policies of its predecessor, and the relatively robust economic growth of the mid-1990s continued until about the third year of its term in office. After that, regional, global and domestic factors contributed to a decline in economic growth. Job creation remained limited throughout this period and the public perceived a significant amount of public-sector corruption. Both factors contributed to increasing social protests during the second half of Banzer's term.
At the outset of his government, President Banzer launched a policy of using special police units to physically eradicate the illegal coca of the Chapare region. The policy produced a sudden and dramatic 4-year decline in Bolivia's illegal coca crop, to the point that Bolivia became a relatively small supplier of coca for cocaine. The MIR of Jaime Paz Zamora remained a coalition partner throughout the Banzer government, supporting this policy (called the Dignity Plan).
On August 6, 2001, Banzer resigned from office after being diagnosed with cancer. He died less than a year later. Banzer's U.S.-educated Vice President, Jorge Fernando Quiroga Ramírez, completed the final year of the term. Quiroga was constitutionally prohibited from running for national office in 2002 but could do so in 2007.
In the June 2002 national elections, former President Gonzalo Sánchez de Lozada (MNR) placed first with 22.5% of the vote, followed by illegal-coca advocate and indigenous campesino leader Evo Morales (Movement Toward Socialism, MAS) with 20.9%. Morales edged out populist candidate Manfred Reyes Villa of the New Republican Force (NFR) by just 700 votes nationwide, earning a spot in the congressional run-off against Sánchez de Lozada on August 4, 2002.
A July agreement between the MNR and the fourth-place MIR, which had again been led in the election by former president Paz Zamora, virtually ensured the election of Sánchez de Lozada in the congressional run-off, and on August 6 he was sworn in for the second time. The MNR platform featured three overarching objectives: economic reactivation (and job creation), anti-corruption, and social inclusion.
Social Crisis and the nationalization of hydrocarbon resources (2003)
A 4-year economic recession, tight fiscal situation, and longstanding ethnic tensions created in February 2003 a police revolt that nearly toppled the government of President Sánchez de Lozada; several days of unrest left more than 30 persons dead. The government stayed in power but remained unpopular. Widespread protests broke out in October and revealed deep dissatisfaction with the government. Approximately 80 persons died during the demonstrations which led President Sánchez de Lozada to resign from office on October 17. In a constitutional transfer of power, Vice President Carlos Mesa assumed the Presidency and promised to hold a binding referendum on the export of Bolivian natural gas. The referendum took place on July 18, and Bolivians voted overwhelmingly in favor of development of the nation’s hydrocarbon resources. Mesa will detail the government’s development plans in legislation to be introduced to Congress. Mesa enjoys popularity with the Bolivian public, but he faces the same difficulties — social divisions, a radical opposition committed to extra-parliamentary action, and an ongoing fiscal deficit — as the previous administration.
Main article: Politics of Bolivia
The 1967 constitution, revised in 1994, provides for balanced executive, legislative, and judicial powers. The traditionally strong executive, however, tends to overshadow the Congress, whose role is generally limited to debating and approving legislation initiated by the executive. The judiciary, consisting of the Supreme Court and departmental and lower courts, has long been riddled with corruption and inefficiency. Through revisions to the constitution in 1994, and subsequent laws, the government has initiated potentially far-reaching reforms in the judicial system and processes.
Bolivia's nine departments received greater autonomy under the Administrative Decentralization law of 1995, although principal departmental officials are still appointed by the central government. Bolivian cities and towns are governed by directly elected mayors and councils. Municipal elections were held on 5 December 2004, with councils elected to 5-year terms. The Popular Participation Law of April 1994, which distributes a significant portion of national revenues to municipalities for discretionary use, has enabled previously neglected communities to make striking improvements in their facilities and services.
Main article: Departments of Bolivia
Bolivia is divided into nine departments, or departamentos:
Additionally, each deparment is further divided into provinces, or provincias, which handle some local affairs and are similar to counties in the states of the United States of America.
Map of Bolivia
Main article: Geography of Bolivia
Bolivia is a landlocked nation. The west of Bolivia is situated in the Andes mountain range, with the highest peak, Nevado del Sajama at 6,542 m. The center of the country is formed by a highland plateau, the Altiplano, where most Bolivians live. The east of the country is lowland, and covered by the Amazonian rainforests. Lake Titicaca is located on the border between Bolivia and Peru. In the west, in the department of Potosí, lies the Salar de Uyuni, the world's largest salt flats.
Major cities are La Paz, Sucre, Santa Cruz de la Sierra and Cochabamba.
Main article: Economy of Bolivia
Bolivia's 2002 gross domestic product (GDP) totaled $7.9 billion. Economic growth is about 2.5% a year and inflation is expected to be between 3% and 4% in 2002 (it was under 1% in 2001).
Since 1985, the Government of Bolivia has implemented a far-reaching program of macroeconomic stabilization and structural reform aimed at maintaining price stability, creating conditions for sustained growth, and alleviating poverty. A major reform of the customs service in recent years has significantly improved transparency in this area. The most important structural changes in the Bolivian economy have involved the capitalization of numerous public-sector enterprises. (Capitalization in the Bolivian context is a form of privatization where investors acquire a 50% share and management control of public enterprises by agreeing to invest directly into the enterprise over several years rather than paying cash to the government).
Parallel legislative reforms have locked into place market-oriented policies, especially in the hydrocarbon and telecommunication sectors, that have encouraged private investment. Foreign investors are accorded national treatment, and foreign ownership of companies enjoys virtually no restrictions in Bolivia. While the capitalization program was successful in vastly boosting foreign direct investment (FDI) in Bolivia ($1.7 billion in stock during 1996-2002), FDI flows have subsided in recent years as investors complete their capitalization contract obligations.
In 1996, three units of the Bolivian state oil corporation (YPFB) involved in hydrocarbon exploration, production, and transportation were capitalized, facilitating the construction of a gas pipeline to Brazil. The government has a long-term sales agreement to sell natural gas to Brazil through 2019. The Brazil pipeline carried about 12 million m² per day in 2002. Bolivia has the second-largest natural gas reserves in South America, and its current domestic use and exports to Brazil account for just a small portion of its potential production. The government expects to hold a binding referendum in 2004 on plans to export natural gas. Widespread opposition to exporting gas through Chile touched off protests that led to the resignation of President Sánchez de Lozada in October 2003.
In April 2000, violent protests over plans to privatize the water utility in the city of Cochabamba led to nationwide disturbances. The government eventually cancelled the contract without compensation to the investors, returning the utility to public control. The foreign investors in this project continue to pursue an investment dispute case against Bolivia for its actions.
Bolivian exports were $1.3 billion in 2002, from a low of $652 million in 1991. Imports were $1.7 billion in 2002. Bolivian tariffs are a uniformly low 10%, with capital equipment charged only 5%. Bolivia's trade deficit was $460 million in 2002.
Bolivia's trade with neighboring countries is growing, in part because of several regional preferential trade agreements it has negotiated. Bolivia is a member of the Andean Community and enjoys nominally free trade with other member countries (Peru, Ecuador, Colombia, and Venezuela.) Bolivia began to implement an association agreement with Mercosur (Southern Cone Common Market) in March 1997. The agreement provides for the gradual creation of a free trade area covering at least 80% of the trade between the parties over a 10-year period, though economic crises in the region have derailed progress at integration. The U.S. Andean Trade Preference and Drug Enforcement Act (ATPDEA) allows numerous Bolivian products to enter the United States free of duty on a unilateral basis, including alpaca and llama products and, subject to a quota, cotton textiles.
The United States remains Bolivia's largest trading partner. In 2002, the United States exported $283 million of merchandise to Bolivia and imported $162 million. Bolivia's major exports to the United States are tin, gold, jewellery, and wood products. Its major imports from the United States are computers, vehicles, wheat, and machinery. A Bilateral Investment Treaty between the United States and Bolivia came into effect in 2001. Agriculture accounts for roughly 15% of Bolivia's GDP. The amount of land cultivated by modern farming techniques is increasing rapidly in the Santa Cruz area, where weather allows for two crops a year. Soybeans are the major cash crop, sold into the Andean Community market. The extraction of minerals and hydrocarbons accounts for another 10% of GDP and manufacturing less than 17%.
The Government of Bolivia remains heavily dependent on foreign assistance to finance development projects. At the end of 2002, the government owed $4.5 billion to its foreign creditors, with $1.6 billion of this amount owed to other governments and most of the balance owed to multilateral development banks. Most payments to other governments have been rescheduled on several occasions since 1987 through the Paris Club mechanism. External creditors have been willing to do this because the Bolivian Government has generally achieved the monetary and fiscal targets set by IMF programs since 1987, though economic crises in recent years have undercut Bolivia's normally good record. Rescheduling agreements granted by the Paris Club has allowed the individual creditor countries to apply very soft terms to the rescheduled debt. As a result, some countries have forgiven substantial amounts of Bolivia's bilateral debt. The U.S. Government reached an agreement at the Paris Club meeting in December 1995 that reduced by 67% Bolivia's existing debt stock. The Bolivian Government continues to pay its debts to the multilateral development banks on time. Bolivia is a beneficiary of the Heavily Indebted Poor Countries (HIPC) and Enhanced HIPC debt relief programs, which by agreement restricts Bolivia's access to new soft loans. Bolivia was one of three countries in the Western Hemisphere selected for eligibility for the Millennium Challenge Account and is participating as an observer in FTA negotiations.
Main article: Demographics of Bolivia
Bolivia's ethnic distribution is estimated to be 56%-70% indigenous people, and 30%-42% European and mixed. The largest of the approximately three-dozen indigenous groups are the Quechua (2.5 million), Aymara (2 million), Chiquitano (180,000), and Guarani (125,000). There are small German, former Yugoslav, Asian, Middle Eastern, and other minorities, many of whose members descend from families that have lived in Bolivia for several generations.
Bolivia is one of the least developed countries in South America. Almost two-thirds of its people, many of whom are subsistence farmers, live in poverty. Population density ranges from less than one person per square kilometer in the southeastern plains to about 10 per square kilometer. (25 per sq. mi.) in the central highlands. The annual population growth rate is about 2.74% (2002).
La Paz is the world's highest capital city at 3,600 meters (11,800 ft.) above sea level. The adjacent city of El Alto, at 4,200 meters above sea level, is one of the fastest growing in the hemisphere. Santa Cruz, the commercial and industrial hub of the eastern lowlands, also is experiencing rapid population and economic growth.
The great majority of Bolivians are Roman Catholic (the official religion), although Protestant denominations are expanding strongly. Many indigenous communities interweave pre-Columbian and Christian symbols in their worship. About half of the people speak Spanish as their first language. Approximately 90% of the children attend primary school but often for a year or less. The literacy rate is low in many rural areas. The cultural development of what is present-day Bolivia is divided into three distinct periods: pre-Columbian, colonial, and republican. Important archaeological ruins, gold and silver ornaments, stone monuments, ceramics, and weavings remain from several important pre-Columbian cultures. Major ruins include Tiwanaku, Samaipata , Incallajta, and Iskanwaya . The country abounds in other sites that are difficult to reach and have seen little archaeological exploration.
The Spanish brought their own tradition of religious art which, in the hands of local indigenous and mestizo builders and artisans, developed into a rich and distinctive style of architecture, painting, and sculpture known as "Mestizo Baroque." The colonial period produced not only the paintings of Pérez de Holguín, Flores, Bitti, and others but also the works of skilled but unknown stonecutters, woodcarvers, goldsmiths, and silversmiths. An important body of native baroque religious music of the colonial period was recovered in recent years and has been performed internationally to wide acclaim since 1994.
Bolivian artists of stature in the 20th century include, among others, Guzmán de Rojas, Arturo Borda, María Luisa Pacheco, and Marina Núñez del Prado. Bolivia has rich folklore. Its regional folk music is distinctive and varied. The "devil dances" at the annual carnival of Oruro are one of the great folkloric events of South America, as is the lesser known carnival at Tarabuco .
Main article: Culture of Bolivia
Bolivian culture has many Inca and other Indian influences in religion, music and clothing, such as the well known bowler hats. The best known fiesta is the UNESCO heritage 'El carnaval de Oruro'. Entertainment includes football, which is the national sport, played on almost every street corner. Also, zoos are a popular attraction with a diverse population of interesting creatures.
See Music of Bolivia
Much of the material in these articles comes from the CIA World Factbook 2000 and the 2003 U.S. Department of State website.
- Herbert S. Klein, "A Concise History of Bolivia", Cambridge 2003