Bolivia is one of the more interesting countries to watch in Latin America. Its president, Evo Morales, is often lumped in with the likes of Hugo Chávez as a leftist reactionary, but the reality behind the rhetoric is that Bolivia is treading a pragmatic and not ideological path.
In this vein one of the more interesting developments is Bolivia’s return to global capital markets, capped recently by a US$500 million bond issue, the first in about 100 years. Markets reportedly are pleased with the macroeconomic fundamentals of Bolivia, but a bit wary of the country’s lack of a repayment record.
Part of the challenge that Morales faces is sustaining his country’s string of high annual economic growth rates but in a manner that finally includes the indigenous majority in his country. Despite successive waves of mineral-based growth over the last two hundred years, the benefits of lead, silver, tin and gas extraction have percolated through only to a small elite, an issue mapped out in the book From Silver to Cocaine. Efforts to reverse this trend and keep some of the value-added wealth and employment generation in Bolivia has resulted in a significantly tougher line with resource extraction companies, including direct contratemps with giants such as Glencore and Jindal.
Morales is not shy of decrying slights to his country, which feeds his reputation as being part of the Bolivarian reactionary left. But, if a bit more attention is given to the substance of his complaints and actions what emerges is closer to a pattern of a newly confident country attempting to pave its own path to inclusive development within existing global market frameworks and behind the challenge of being a landlocked country with still poorly developed human capital resources.