The Economy of Bolivia
Natural Gas and the 2006 Nationalisation
Under Evo Morales, Bolivia nationalised its gas industry in 2006, sharply raising state revenue and funding social programmes.
A turning point.
Gas boom
Gas exports to Brazil and Argentina expanded in the 2000s.
2006
Morales’ government nationalised hydrocarbons and renegotiated contracts to capture more revenue.
Results
Revenue rose and poverty fell, backed by high commodity prices.
Later problems
Falling output and lack of new exploration reduced exports.
A pipeline income
Payments from Brazil for gas funded cash transfers to families.
Assuming high revenue lasts forever
Reserves deplete.
Key takeaways
- Gas was nationalised in 2006.
- Revenue surged.
- Poverty fell.
- Output later declined.
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