Apart from looting nations, there is one thing that the militants of 21st Century Socialism are experts at: building stories. For example, they called the inflation of housing prices a boom, or economic growth the simple fattening of the Bolivian state apparatus.
However, fables, no matter how well structured they are, cannot hide reality. And it is that our nation is not armored, nor are we the envy of the world. The economy collapses. Slogans can no longer hide the disaster.
One of the first signs came with Supreme Decree 4716. This approves that the “profits” of the Public Pension Manager (which will replace the AFPS from June 2023) will be used to pay the Dignity Income. In other words, the government will use the workers’ savings to sustain its socialist policies. They don’t have money, but they won’t hesitate for a second to loot the money from the private sector. It’s that simple.
But the thing does not end there. On May 10, the Central Bank of Bolivia (BCB) determined that all state companies that manage accounts abroad must repatriate, within a maximum of 60 days, all the dollars they have outside the country. We are facing the imposition of a fence on all the dollars that can be obtained. You don’t have to be a genius in economics to realize that this measure puts the importation of hydrocarbons in serious difficulties.
Another of the desperate maneuvers of the BCB aims to sell all the gold it can in the international markets. In this regard, the economist Napoleón Pacheco expressed the following:
The decision to use gold would be expressing a much more serious situation than the one we know regarding the NIRs. No government before MAS, nor in critical situations, proposed using the country’s gold reserves. It is a bad sign for the Bolivian economy.
The fact that the government is scraping the pot in search of new sources of financing only reflects one thing: that the Bolivian Productive Social Community Economic Model (MESCPB) has collapsed, and that not even the second commodity boom is going to save it. .
That is why it is incredible, especially given the evident level of decomposition of the national economy, that the government intends to continue spending hand over fist. Well, recently it announced the construction of the second urea plant, four biodiesel plants and one fertilizer plant.
Apparently the gurus of the Ministry of Economy do not know that 85% of state companies generate losses and that the projected fiscal deficit for 2022 is 8%, or they assume that they are just slanders from the “right”, the “coup plotters” and the ’empire’.
Nor do they take into account that, without prior notice, Bolivia reduced its supply of natural gas to Petrobras by 30% this month. The Brazilian state company, surprisingly, suffered a cut equivalent to about 7 million cubic meters of gas per day.
Likewise, the country is experiencing shortages of diesel in at least five departments, but above all in Santa Cruz. It is worth remembering that 70% of the country’s basic food basket is produced in the eastern capital. In addition, for weeks there has been a shortage of corn, pork and chicken in the markets.
Given this scenario, the government’s response was to threaten to expropriate land, intervene in corn-producing companies, and turn EMAPA (the state company in charge of producing food) into a vigilante entity.
As the great Ludwig von Mises said: “A centrally planned economy has no way of calculating economically and thus cannot prosper.” That’s why in Bolivia we don’t have to ask ourselves what, since everything points to a default, but rather when.
poor country!
“The opinions published here are the sole responsibility of their author.”
