Bolivia's Foreign Trade Report 2018
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Trade in Bolivia - 2018
The Bolivian Institute of Foreign Trade (IBCE, for its Spanish name) has published its assessment of Bolivia's trade statistics based on the National Statistical Institute's numbers. Here is a run down of the most important aspects of this report.
Exports
The Export sector for Bolivia has experienced a turnaround in 2017. While for the period 2014-2016 Bolivian trade suffered a significant decline from 12.8 to 7.09 billion dollars, the estimated value for 2017 is expected to be an improvement to 7.8 billion dollars. The main explanation for this improvement (and for the previous decline) has not changed. The most important factor for such changes in the Bolivian case has been the economy’s dependence on the international oil price increase and decrease, which is coupled with the price of Bolivia’s most important export, natural gas.
This dependence can be clearly seen when we take a look at the above images which show the most important export sectors and the share of exports by what Bolivians call traditional and non-traditional exports. Traditional products are considered to be commodities, such as natural gas and its derivatives, minerals and oil and non-traditional are other products, such as agricultural and manufactured products. Traditional exports represented the largest share of exports with 82.09% compared to the non-traditional exports which represented 17.91%. Of the share of traditional exports, natural gas and minerals represented a little over 62%. The rest of the products Bolivia exported in 2017 were: soy cake, soy oil (refined and unrefined), Brazil nuts, jewelry, quinoa, bananas, ethyl alcohol, chia and leather.
If we look at a breakdown of exports per department, we find four departments, namely La Paz (14.74%), Santa Cruz (24.20%), Tarija (20.37) and Potosi (27.19%), which would represent the lion’s share of exports. Other departments, namely Beni (5.24%), Oruro (4.18%), Cochabamba (3.06%), Chuquisaca (0.69%) and Pando (0.33%) represent a small part of exports. However, this picture is somewhat distracting and hides some important considerations. The shares include the export of traditional products without which the shares of Tarija and Potosi would not be that large. In addition, because the share of natural gas exports has declined in the last years, it has signified an increase in the share of Potosi’s exports. At the same time, Cochabamba, even though it does not seem like from this image, is the third most important city in the country in terms of production of non-traditional products such as shoes, agricultural products, canned food, and chemical products.
In terms of which countries are the most important buyers of Bolivian products, Brazil and Argentina hold the first and second places. Once again, the role of traditional products is important in this placing, because these two countries import natural gas from Bolivia and represent 34.11% of all the other importing countries. The image above shows that Bolivia does have a diverse commercial relationship with other countries. The list includes South Korea, the United States, Japan, India, China, Colombia, Peru, United Arab Emirates and other countries with minor interest such as Germany, France, Netherlands and the UK, for example. While most agricultural products tend to go to countries in the region, the US and some Asian countries tend to buy minerals, soy products and some other products. West European countries have concentrated on the purchase of quinoa and chia seeds.
Imports
In terms of imports to Bolivia, the country has made up in 2017 the small decline in recent years. The country has been able to keep demand up and, as such, counterbalance the decline in world oil prices with a strong domestic demand. This has been possible due to the central role the government plays in the economy today. The government has been investing in the creation of many sorts of industrial ventures from computers to milk and thus giving impulses to the economy. At the same time, the construction sector has been one of the most dynamic sectors in the last decade.
Bolivia has been demanding and importing capital and transport goods as well as their parts (39.93%), and other industrial machinery (29.75%). It has also imported consumer goods (13.10%), food and beverages (7.30%) as well as lubricants and gasoline (9.88%).
The list of countries from which these products come include China, Brazil, Argentina, US, Peru, Chile, Japan, Mexico, Colombia, and Germany. It is important to highlight that China has become the most important country from which Bolivia buys products such as clothing, machinery, transport products and their parts, mobile phones, and some chemical products.
The lion’s share of imports go to Santa Cruz (42.48%), which has become the most economically dynamic department in Bolivia. La Paz, which used to be in first place, comes now in second with 24.86% of share of imports, while Oruro (15.78%), Cochabamba (7.72%) and Tarija (6.28%) come in distant third. La Paz has been constructing a public transportation system based on cable cars and normal buses. It is precisely these types of products that the department has been importing. Through Oruro enter the country diesel and other types of refined gasoline and many transport products which are then distributed to other parts of the country. The department’s main economic activity is mining. Throughout the country the government has been constructing geothermal stations to produce electricity. For those types of investments the country has been importing transport goods, engines and metal parts. Lastly, but importantly, the country has also been importing flour, which shows the various price and production and export controls the government has been implementing to guarantee what it calls fair or solidarity prices of foods has not been working. One of the worst consequences of all these measures (principally of subsidies) has been the increase in contraband.
Conclusion
Bolivia has run a trade deficit for 2017. On the one side, this is due to the less than optimal developments in the international prices for Bolivia's most important export product, natural gas. The country has experienced better times. On the other side, the country has been accumulating capital goods, which in terms of future economic development is not a bad investment. It will all depend on how are these goods being used. It will all depend on whether the government's plans of industrializing the country are realized or not.
Trade in Bolivia - 2018
The Bolivian Institute of Foreign Trade (IBCE, for its Spanish name) has published its assessment of Bolivia's trade statistics based on the National Statistical Institute's numbers. Here is a run down of the most important aspects of this report.
Exports
The Export sector for Bolivia has experienced a turnaround in 2017. While for the period 2014-2016 Bolivian trade suffered a significant decline from 12.8 to 7.09 billion dollars, the estimated value for 2017 is expected to be an improvement to 7.8 billion dollars. The main explanation for this improvement (and for the previous decline) has not changed. The most important factor for such changes in the Bolivian case has been the economy’s dependence on the international oil price increase and decrease, which is coupled with the price of Bolivia’s most important export, natural gas.
This dependence can be clearly seen when we take a look at the above images which show the most important export sectors and the share of exports by what Bolivians call traditional and non-traditional exports. Traditional products are considered to be commodities, such as natural gas and its derivatives, minerals and oil and non-traditional are other products, such as agricultural and manufactured products. Traditional exports represented the largest share of exports with 82.09% compared to the non-traditional exports which represented 17.91%. Of the share of traditional exports, natural gas and minerals represented a little over 62%. The rest of the products Bolivia exported in 2017 were: soy cake, soy oil (refined and unrefined), Brazil nuts, jewelry, quinoa, bananas, ethyl alcohol, chia and leather.
If we look at a breakdown of exports per department, we find four departments, namely La Paz (14.74%), Santa Cruz (24.20%), Tarija (20.37) and Potosi (27.19%), which would represent the lion’s share of exports. Other departments, namely Beni (5.24%), Oruro (4.18%), Cochabamba (3.06%), Chuquisaca (0.69%) and Pando (0.33%) represent a small part of exports. However, this picture is somewhat distracting and hides some important considerations. The shares include the export of traditional products without which the shares of Tarija and Potosi would not be that large. In addition, because the share of natural gas exports has declined in the last years, it has signified an increase in the share of Potosi’s exports. At the same time, Cochabamba, even though it does not seem like from this image, is the third most important city in the country in terms of production of non-traditional products such as shoes, agricultural products, canned food, and chemical products.
Imports
In terms of imports to Bolivia, the country has made up in 2017 the small decline in recent years. The country has been able to keep demand up and, as such, counterbalance the decline in world oil prices with a strong domestic demand. This has been possible due to the central role the government plays in the economy today. The government has been investing in the creation of many sorts of industrial ventures from computers to milk and thus giving impulses to the economy. At the same time, the construction sector has been one of the most dynamic sectors in the last decade.
Bolivia has been demanding and importing capital and transport goods as well as their parts (39.93%), and other industrial machinery (29.75%). It has also imported consumer goods (13.10%), food and beverages (7.30%) as well as lubricants and gasoline (9.88%).
The list of countries from which these products come include China, Brazil, Argentina, US, Peru, Chile, Japan, Mexico, Colombia, and Germany. It is important to highlight that China has become the most important country from which Bolivia buys products such as clothing, machinery, transport products and their parts, mobile phones, and some chemical products.
The lion’s share of imports go to Santa Cruz (42.48%), which has become the most economically dynamic department in Bolivia. La Paz, which used to be in first place, comes now in second with 24.86% of share of imports, while Oruro (15.78%), Cochabamba (7.72%) and Tarija (6.28%) come in distant third. La Paz has been constructing a public transportation system based on cable cars and normal buses. It is precisely these types of products that the department has been importing. Through Oruro enter the country diesel and other types of refined gasoline and many transport products which are then distributed to other parts of the country. The department’s main economic activity is mining. Throughout the country the government has been constructing geothermal stations to produce electricity. For those types of investments the country has been importing transport goods, engines and metal parts. Lastly, but importantly, the country has also been importing flour, which shows the various price and production and export controls the government has been implementing to guarantee what it calls fair or solidarity prices of foods has not been working. One of the worst consequences of all these measures (principally of subsidies) has been the increase in contraband.
Conclusion
Bolivia has run a trade deficit for 2017. On the one side, this is due to the less than optimal developments in the international prices for Bolivia's most important export product, natural gas. The country has experienced better times. On the other side, the country has been accumulating capital goods, which in terms of future economic development is not a bad investment. It will all depend on how are these goods being used. It will all depend on whether the government's plans of industrializing the country are realized or not.
