Bolivia Charts Return to International Credit Market by 2027

Bolivia's finance minister Jose Gabriel Espinoza Photographer: Marcelo Perez del Carpio/Bloomberg Photo by Marcelo Perez del Carpio /Photographer: Marcelo Perez del

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(Bloomberg) — Bolivia’s new government expects to secure up to $5 billion in multilateral loans next year and return to international credit markets in late 2026 or early 2027, Finance Minister José Gabriel Espinoza said in an interview. 

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Around half of the loans under discussion with the International Monetary Fund, World Bank, Inter-American Development Bank and Corporacion Andina de Fomento (CAF) are aimed at boosting private-sector transport, energy and infrastructure projects, Espinoza said.

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“These $4 to $5 billion won’t be strictly public debt. A good part will be used to leverage private-sector development,” Espinoza said this week, mentioning credit lines, guarantee funds to access tenders and working-capital facilities. 

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Centrist President Rodrigo Paz, who took office this month following two decades of socialist rule, is moving quickly to tackle the South American nation’s economic crisis and restore credibility with investors. Long lines for gasoline and diesel have now faded after fuel traders extended credit lines, betting on a brighter economic outlook and renewed US and multilateral support, Espinoza said. 

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Timely loan payments, along with a drop in country risk, will position Bolivia to issue new bonds by early 2027, the finance minister said from his office in La Paz. 

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“Default is not an option,” Espinoza said when asked about public-debt management, including a $333 million payment due in March on a eurobond maturing in 2028. He said negotiations will take place, but declined to provide details, adding that “all creditors will receive their payment under the conditions in which they feel most comfortable.”

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Although a domestic gold-purchase system implemented by the central bank in 2023 to address dollar shortages will continue, the minister said “the mechanisms are going to change” in order to foster a formal gold-mining industry that complies with environmental and labor rules. 

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Bolivia will create a gold bank with public and private capital to allow government oversight over the strategic metal, he said.

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CAF has already announced a $3.1 billion support program for Bolivia for the next five years, including $550 million approved for short-term disbursement. 

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Under previous administration foreign credit typically went to the public sector, this time the goal is to give domestic private companies a more prominent role under specific conditions. 

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The Paz administration plans to cut costly fuel subsidies, maintaining targeted support to mitigate the social impact. The issue is sensitive in Latin America, as recent protests in Ecuador showed.

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The government will transfer fuel distribution to the private sector to make it more efficient, while keeping state-owned YPFB in charge of supplying remote places where the market has no incentive to operate, Espinoza said.