Bolivia - Market OverviewBolivia - Market Overview
Top Five Reasons to Consider Bolivia
The Bolivian economy is still growing. For the the past ten years, the economy has grown by nearly five percent annually and Bolivia’s growth rates have led South America for each of the past four years. This has led to a dramatic increase in the size and purchasing power of an emergent middle class.
Bolivians like American products. Made in the USA generally signals quality and innovation to Bolivian consumers. Bolivians also like to purchase U.S. products due to the status they confer. For larger purchases by local governments, U.S. products and services are viewed as reliable due to customer service standards, warranties, and maintenance plans.
Bolivia is rich in non-renewable natural resources. Mining and hydrocarbons are some of Bolivia’s largest export sectors, and there is still room to grow. In addition to presently mined minerals such as zinc, silver, lead, and tin, Bolivia boasts significant lithium deposits, which remain mostly unexploited.
Bolivia’s agricultural sector will continue to grow. But in order to do so, Bolivian businesses will need new technology in products ranging from irrigation to farm equipment. The Bolivian government is also considering allowing the use of bioengineered crops in order to increase production.
The Bolivian government wants to promote Foreign Direct Investment (FDI). President Evo Morales’ cabinet and advisors understand that increasing FDI will be key to sustaining the country’s economic growth.
For the four year period from 2013 to 2017, Bolivia’s economy grew at an average yearly rate of 5.1 percent. This compares favorably to the 4.5 percent average yearly growth between 2009 and 2012. The 2017 increase in GDP resulted from a 7.6 percent growth in agriculture, 5.2 percent growth in transport and telecommunications, 5.1 percent growth in commercial activities, 5 percent growth in construction, 4.8 percent growth in financial services, and 4.8 percent growth in government consumption.
|Nominal GDP||$34.1 billion||$37.8 billion|
|GDP Real Annual Growth Rate||4.3 percent||4.2 percent|
|GDP per capita (PPP)||$7,234||$7,560|
|GDP per capita||$3,092||$3,393|
|Exports||$7.2 billion||$7.9 billion|
|Imports||$8.4 billion||$9.3 billion|
|Total Imports from the United States||$0.8 billion||$0.6 billion|
|Inflation||4 percent||2.7 percent|
Source: National Bureau of Statistics (INE) and International Monetary Fund
Accumulated inflation for 2017 was 2.7 percent, more than one percent below the 2016 figure. Inflation was primarly due to increases in non-food prices. Food items registered an overall decrease from 5.2 percent in 2016 to 2.54 percent in 2017. The Central Bank estimates that the inflation rate in 2018 will approach five percent.
Total investment in Bolivia decreased in 2017, from $8.9 billion in 2016 to $8.0 billion this past year. Private domestic investment neared $1.0 billion in 2017. Public investment decreased from $6.8 billion in 2016 to $6.4 billion in 2017, due primarily to decreased investment by state-run companies, particularly in the energy sector. Net FDI increased from $300 million in 2016 to $740 million in 2017.
Total Bolivian exports increased by 11 percent in 2017, reaching $7.9 billion, primarily due to a continued recovery in commodity prices, especially for Bolivian natural gas exports. In 2017, the top export sectors were hydrocarbons (33 percent), manufactured goods (32 percent), minerals (28 percent), and agricultural products (five percent). By product, the top 2017 exports include natural gas (32 percent), zinc (17 percent), gold (13 percent), soy (seven percent), silver (seven percent) and tin (four percent).
Bolivia’s top 2017 export markets were Brazil (18 .1 percent), Argentina (15.8 percent), the United States (7.8 percent), South Korea (7.7 percent) and Japan (7.6 percent).
From 2016 to 2017, Bolivian imports increased by 11 percent to $9.3 billion. 30 percent of Bolivia’s total imports were industrial supplies and inputs, such as replacement parts, chemicals, and other production items. Other major imports were capital goods (24 percent), transport equipment and parts (16 percent), consumable goods (ten percent), fuel (nine percent) and food (seven percent). Top import products within these categories were machinery and mechanical apliances, chemical products, vehicles, fuels and oils, food, and minerals. Bolivia also imports significant quantities of steel, electrical machinery equipment and parts, and plastics and plastic products.
Bolivia Trade Development and Promotion