Bolivia country brief

Overview

Australia and Bolivia (now formally known as the Plurinational State of Bolivia) established diplomatic relations on 10 April 1975 with Australia's first Ambassador to Bolivia (resident in Brasilia) presenting credentials later that year, and Bolivia's non-resident Ambassador to Australia presenting credentials in 1977. Australia's embassy in Peru is currently responsible for Bolivia and Australia's Honorary Consul, Dr Cristina Fernandez, is based in La Paz. The Consulate of Bolivia in Australia is located in Sydney and Bolivia's Ambassador to Australia, HE Pablo Guzman Laugier, is resident in Ottawa.

Australia works with Bolivia in a number of multilateral forums, particularly in the UN on indigenous issues, and in bodies such as FEALAC (The Forum for East Asia Latin America Cooperation).

The Plurinational State of Bolivia is a landlocked country slightly larger than South Australia. The country is dominated by two regions, the Bolivian High Plateau or ‘Altiplano’ and the lowlands which make up part of the Amazon basin. The Altiplano’s average elevation above sea level is around 3,650 metres and is dominated by a number of mountains of more than 6,000 metres. The Altiplano is also home to the Salar de Uyuni, the world’s largest salt flat, and the world’s highest navigable lake, Lake Titicaca on the Bolivia-Peru border. Bolivia borders Chile and Peru to the West, Argentina and Paraguay to the south and Brazil to the north and east. Bolivia’s administrative capital is La Paz and its constitutional capital is Sucre. Bolivia is named after Simon Bolivar, one of the key figures in South American countries’ independence movements.

Bolivia's population is approximately 11.1 million (2017 est). An estimated seven per cent of Bolivia's population lives abroad. Roman Catholicism is the main religion. Spanish and a number of indigenous languages (Quechua, Aymara, Guaraní) are the official languages of Bolivia.

Political overview

Bolivia was settled as a Spanish colony following the defeat of the Incan Empire in 1533. It was known as Upper Peru and was under the administration of the viceroy of Lima. The local government was established in the modern Bolivian city of Sucre in 1559, until the colony attained independence from Spain in 1825. The newly independent nation then suffered a period of economic decline and the loss of territory in disputes with neighbouring nations, most notably the loss of Pacific coast access and territory to Chile. This occurred during the War of the Pacific, which Bolivia fought with Peru against Chile in 1879, and remains an ongoing source of resentment, with Bolivia strongly pushing the issue of its maritime aspirations in the form of a 'corridor' to the sea.

After a long period of instability marked by coups and military rule, democratic civilian rule was established in 1982. However, the proliferation of political parties since then has resulted in political fragmentation. Organised labour has historically been strong, and capable of coordinating large demonstrations in support of improved salaries and conditions and at times in opposition to free-market reforms. The Catholic Church has played a significant intermediary role between the government and social groups.

President Evo Morales has been in office in Bolivia since 2005. He is the first candidate of indigenous origin to have become President in Bolivia.

President Morales undertook constitutional reform in Bolivia, with a draft Constitution endorsed by a constituent assembly in November 2007, and later approved by referendum (with a 59 per cent majority) in January 2009. The referendum promoted indigenous rights, limited private land holdings to 5000 hectares and lifted the ban on Presidents serving consecutive terms (with two terms as a maximum). In 2014, Morales won a third term in office, after the constitutional court ruled that his first term did not count, as it preceded the 2009 constitution. He received 60 per cent of the vote against 25 per cent for his closest rival.

Coca in Bolivia is a highly sensitive issue. In June 2011, Bolivia formally notified the UN of its withdrawal from the UN Convention on Drugs but reapplied for readmission in January 2012. This was a move to reconcile the new 2009 Constitution with international commitments. As the traditional and centuries-long practice of coca-leaf chewing in Bolivia is prohibited by the Convention, President Morales had been arguing that the latter was in conflict with Bolivia’s new constitution, which obliges it to "protect native and ancestral coca as cultural patrimony". On January 2013, the UN announced, following consultations with signatories to the Convention, Bolivia’s readmission to the Convention with a reservation recognising the practice of coca leaf chewing as legal in Bolivia.

System of government

Bolivia is a democratic republic with a directly elected President who serves a five-year term. Bolivia has a bicameral system of government: the Senate has 36 members (members are elected by proportional representation from party lists for five year terms); the Chamber of Deputies has 130 members (70 of whom are directly elected, seven of whom are special indigenous deputies elected from non-contiguous indigenous districts and 53 who are elected by proportional representation from party lists).

Bolivia’s constitutional capital is Sucre but the seat of government is La Paz.

Recent developments

In February 2016, a constitutional referendum which proposed removing Presidential term limits was voted down, 51.3 to 48.7 per cent.

In response to this, Morales' ruling party, the Movement Towards Socialism, asked the constitutional court to rule on lifting term limits. In November 2017, Bolivia's constitutional court lifted constitutional limits on re-election, claiming they violated the candidates' human rights.

Foreign policy

Bolivia’s strongest economic and political relationships are with its neighbours. Brazil and Argentina are two of its largest trading partners (and the largest consumers of Bolivia’s dominant export, natural gas), and it has a free-trade agreement with Mexico.

Bilateral relations with Chile remain strained due to the lasting negative effects on Bolivia of the War of the Pacific in 1879, when it lost its access to the Pacific Ocean and became a landlocked country. Bolivian relations with Chile have worsened since Bolivia instituted a sea-access claim against Chile to the International Court of Justice in April 2014.

In December 2012, President Morales signed a protocol aimed at Bolivia's accession to the Southern Cone Common Market, Mercosur (Latin American Regional Organisations), which will provide Bolivia with preferential trade access to the markets of other member countries. As a member of the Bolivarian Alliance for the Americas (ALBA), Bolivia has aligned itself politically with other socialist-oriented governments in the region, including Venezuela and Cuba.

Bolivia is a member of other regional organisations that seek to advance political and economic interests, including the Latin American Integration Association (ALADI), the Amazon Pact, the Union of South American Nations (UNASUR), the Organization of American States (OAS), the Community of Caribbean and Latin American States (CELAC), the Andean Community (CAN) and the Forum for East Asia-Latin American Cooperation (FEALAC). It is also a member of the UN, the Non-Aligned Movement, the International Parliamentary Union and the World Trade Organization (WTO).

The United States remains a significant trading partner for Bolivia, and in 2011 both countries signed a bilateral framework to normalise relations and pledged greater cooperation in addressing illegal drug trafficking.

The bilateral relationship between China and Bolivia is growing. Several high-level exchanges between the two countries have enhanced cooperation in the areas of trade, satellite training, construction and launch programs, culture, health and education. President Morales visited China in August 2011, and Chinese Vice-Premier Hui Liangyu visited Bolivia one month later. In May 2013, Bolivia and China agreed to cooperate on military, operational and logistics capabilities.

Bilateral relations

An early link between Australia and Bolivia came about in 1840 when a squatter who had previously been in Bolivia established a sheep station in a locality in northern New South Wales. The locality continues to be known as Bolivia.

In 2001, the Australian Government established the Council on Australia-Latin America Relations (COALAR), which aims to enhance commercial, political and cultural relations between Australia and Latin America. Since its inception, COALAR has been active in promoting business, education, tourism and cultural links between Australia and Latin America. For updates on COALAR activities and information on the annual grants program, follow COALAR on Facebook.

People to people links

In 2016-17, there were 350 arrivals from Bolivia in Australia, and 17,604 Australians visiting Bolivia – up from 12,000 in 2008.

Endeavour Scholarships and Fellowships and Endeavour Mobility Grants support two-way engagement between Australia and the rest of the world. In 2018, one bolivian  scholar was offered an Endeavour Postgraduate Scholarship,. In 2012, ten Australian students had a study experience in Bolivia on an Endeavour Mobility Grant.

As of December 2017, there were 55 Bolivians enrolled in Australian educational institutions, mainly in higher education and ELICOS studies.

Development assistance

From 2010 to 2014, Australia provided $100 million in official development assistance to Latin America, including 254 Australia Awards scholarships. Of these, Bolivia received eight Australia Awards. The regional program has now closed, though some activities that have already been funded will continue until 2018. Australia received one scholar from the Bolivian Government's scholarship program in 2016.

The Australian Embassy in Lima manages a Direct Aid Program (DAP), which provides financial support to non-government organisations. In 2016-17FY the DAP had two projects in Bolivia with a total value of $69,595. One of these projects assisted a rural community with indigenous families and emphasised the participation and empowerment of women.  The other focused ecological farms in schools in Cochabamba.

Economic overview

At a glance

For the latest economic data refer to Country/Economy Fact Sheet [PDF 126 KB]

Economic outlook

In 2017, Bolivia recorded GDP growth, inflation and unemployment of 4.0 per cent, similar to the outcomes in 2016.  Infrastructure spending and gas exports are strong growth drivers.

As a member of the Andean Community (CAN), Bolivia has generally enjoyed free trade with Peru, Ecuador, Colombia and Venezuela.

Bolivia has an Economic Complementation Agreement with Chile dating from 2006 that allows some 6,600 Bolivian products duty-free access to Chile. In April 2006, Bolivia signed a 'People's Trade Agreement' with Cuba and Venezuela as a "means toward development with social justice in the framework of genuine fraternal Latin American and Caribbean integration". The Agreement provides for the export of Venezuelan and Bolivian natural resources in exchange for Cuban medical services. Bolivia withdrew from free trade talks with the European Union in 2008, and similarly withdrew from attempts to negotiate free trade agreements with the United States and Canada. As a member of ALBA, Bolivia and other member countries aim to create alternative regional political and trade initiatives.

Bolivia also enjoys trade benefits under the General Preferential Tariff System with the United States, Canada, Japan, Norway, Switzerland, and the European Union.

Bilateral economic and trade relationship

In 2016, Australian merchandise and services trade with Bolivia was $23.8 million. This comprised imports of $18.7 million from Bolivia and exports of $5.1 million to Bolivia. Australia's exports consisted mainly of measuring and analysing instruments, electrical circuits equipment and crude vegetable matter. Imports from Bolivia included fruit, nuts, cereals, oil-seeds and vegetables.

Trade and Investment

There is modest Australian investment in Bolivia's tourism sector. Bolivia's resource wealth makes it a potential future destination for Australian investment in the extractives sector. Bolivia has a significant amount of the world's reserves of lithium, which is used in batteries. Demand for Lithium is expected to grow.. Bolivia is also rich in tin, silver and iron-ore deposits. In 2011, Bolivia had proven natural gas reserves of over 9.9 trillion cubic feet, the fifth largest reserves in South America, as well as 48 trillion cubic feet of recoverable shale gas reserves.

Australian expertise could also complement Bolivia's agribusiness, education, water and forest resource management and tourism sectors.

 

 

Last Updated: December 2017

Last Updated: 8 December 2017