Bolivia approves $1.9 billion IMF financial aid package

On Thursday and Friday, the Bolivian Parliament approved a $1.9 billion International Monetary Fund (IMF) financial aid package to address the country's worst economic crisis in forty years. The three-year loan program is intended to support comprehensive economic reforms initiated by the government of center-right President Rodrigo Paz, who took office in November 2025.

A central condition of the IMF agreement requires the government to eliminate long-standing fuel subsidies starting in January 2027. These subsidies, which have been in place for approximately two decades, are blamed by authorities for straining public finances and encouraging the illicit cross-border smuggling of fuel, contributing to domestic shortages. President Paz has pledged to reduce state expenditure and pursue privatization as part of his economic platform.

Bolivia has faced significant instability recently, with President Paz declaring a state of emergency in June 2026 following weeks of turmoil. The current economic strategy reflects the administration's attempt to stabilize the national budget through austerity measures and international cooperation.