Bolivia’s Next President Targets Pragmatic Path Out of Crisis

Rodrigo Paz, Bolivia's president-elect, speaks during an election night rally following the presidential runoff election in La Paz, Bolivia, on Oct. 19. Photo by Marcelo Perez del Carpio /Photographer: Marcelo Perez del

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(Bloomberg) — Fresh off winning Sunday’s election, Bolivia’s next president Rodrigo Paz is blazing a rare centrist path out of his country’s economic crisis, focusing on practical policies over ideological divisions engulfing its neighbors.

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The folksy president-elect maintains friendly terms with a range of politicians whose support he’ll need to rescue this landlocked nation from economic ruin. And he’s not shy about mending ties with the US and other countries shunned by his predecessors. Amid scarce fuel and dollars, the stakes are high for Bolivia’s first centrist leader in a generation.

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His victory drew a range of nods, notably a grudging acknowledgment from rabble-rousing former president Evo Morales at home and a hearty congratulations from Venezuela’s conservative opposition leader Maria Corina Machado abroad. 

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Heading into his Nov. 8 inauguration, Paz’s first test will be to replenish fuel supply that the outgoing administration of Luis Arce ran out of money to pay for. He plans to surge in fuel through deferred payments while awaiting dollar injections from multilateral lenders and other foreign sources, said José Gabriel Espinoza, economic adviser to his Democratic Christian Party (PDC).

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“You don’t need dollars when you make a deferred payment,” Espinoza told reporters on Monday. “The problem with waiting for the dollars is that the fuel doesn’t arrive.”

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Paz’s team is in talks with the US as well as Brazil, Argentina, Paraguay and Uruguay to secure emergency supplies, Espinoza said.

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“The US is working with us to facilitate supply routes. The commitment was reaffirmed Sunday by Deputy Secretary of State Christopher Landau,” he said. The PDC is developing plans to set up a “stabilization fund” and allow the private sector to import fuel. In the meantime the task will be overseen by state-owned energy company YPFB.

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The State Department didn’t immediately respond to a request for comment. However, the office released a statement congratulating Paz on his victory “after two decades of mismanagement.” 

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Bolivia normally imports fuel through neighboring Chile with which it broke diplomatic relations in 1978 because of a longstanding dispute over sovereign access to the Pacific.

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Paz won Sunday’s runoff with 54.4% of the vote, defeating right-wing rival Jorge “Tuto” Quiroga of Alianza Libre, who conceded defeat. 

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“Bolivia is breathing winds of change,” Paz said in his victory speech Sunday night. He proclaimed the backing of three other parties in Congress — Libre, Unidad and Súmate — enabling him to pass laws to access international credit and reform the energy and mining sectors to attract foreign investment.

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Paz hasn’t ruled out the possibility of resorting to the International Monetary Fund, a touchy recourse in Latin America because of orthodox policy trade-offs. In a Monday press conference, he said his team is already preparing an initial financial lifeline from regional development banks CAF and Fonplata.