Bolivia’s legislative body has voted to accept a $1.9 billion loan from the International Monetary Fund, representing a significant achievement for President Rodrigo Paz. The Christian Democratic Party, which does not command a majority in Congress, secured approval through support from centrist and right-wing parties. The leftist MAS party, which previously dominated the chamber, now holds only two seats in the 130-member lower house and no representation in the Senate.
Paz emphasized the urgency of the agreement, citing external pressures on Bolivia’s economic situation. The president noted that rising global fuel costs, influenced by international conflicts, have made difficult fiscal decisions necessary for the nation. However, the loan remains contingent on approval from the IMF’s Executive Board before funds can be distributed to the country.
Bolivia’s economic challenges stem from declining natural gas production, a major historical revenue source. Insufficient investment in the sector has caused output to contract significantly, creating a foreign currency shortage that complicates fuel imports. The government has historically maintained fuel prices well below international market rates to protect consumers, a policy that has depleted reserves and created opportunities for smuggling.
Under the IMF programme—Bolivia’s first multi-year arrangement with the fund since 2006—the government must continue reducing fuel subsidies and controlling expenditures. Paz has already implemented price increases and intends to eliminate subsidies entirely by January. Officials project the agreement could unlock approximately $5 billion in additional financing from institutions including the World Bank.
The Bolivian Workers’ Central union federation has strongly opposed the deal, arguing that subsidy cuts will increase living expenses for economically vulnerable populations. This opposition follows weeks of road blockades earlier in the year that disrupted national commerce as demonstrators called for Paz’s removal. Congress extended a state of emergency declaration for an additional 90 days to facilitate infrastructure clearance and maintain order.
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