Bolivia’s external debt is sustainable and is among the lowest in the region – Economy Minister

Bolivia’s external debt registers 29.9% of the Gross Domestic Product (GDP), as of October 2022, a sustainable percentage and is among one of the lowest in the region, The Minister of Economy and Public Finance, Marcelo Montenegro, informed this Monday.

“The external public debt has been reduced in recent decades; until October last year it reached 29.9% of GDP. This debt has been managed responsibly and was reduced by many percentage points of GDP,” he told the journalists.

According to data from the Ministry of Economy, in 1987, the country registered 99.1% of the debt with respect to the size of the economy, but that percentage dropped in 2006 to 28.2% and 2022 is near 30% of the GDP.

According to the minister, the external indebtedness capacity, due to sufficient international margins, allows Bolivia to access credits to implement development projects.

He pointed out that the balance of Bolivia’s external public debt is below the referential limits of international organizations that establish a ceiling of 40% (WB-IMF Debt Sustainability Framework), and 50% (parameter of the Andean Community of Nations-CAN).

He said that the debt policy in the last decade was oriented towards investment and infrastructure projects and productive projects, in order to obtain a positive economic and social return, and stimulate economic growth.

A bulletin from the Ministry of Economy and Public Finance indicates that thanks to the Productive Community Social Economic Model in 2022, Bolivia’s public debt is among the lowest in Latin America and the Caribbean.

“By 2022, thanks to the implementation of the Productive Community Social Economic Model and a responsible fiscal policy, Bolivia’s total public debt is among the lowest in Latin America and the Caribbean, and below economies such as Brazil, Argentina, Costa Rica, Uruguay, Colombia, Mexico, among others,” says the economic portfolio.

The monthly reports of external public debt of the Central Bank of Bolivia (BCB) indicate that around 70% of the debt is with multilateral organizations such as the Inter-American Development Bank (IDB) and the Development Bank of Latin America (CAF), mainly.

With information from Xinhua