Bolivia: MAS Split, Dollar Shortage, Lithium Deals — 2026-09-27
Bolivia enters a tense week: Evo Morales has given President Rodrigo Paz an ultimatum to repeal the diesel decree by 3 October, or face blockades from 13 October, while diesel prices remain 83% higher after the subsidy's removal. The dollar briefly rebounded after the subsidy cut, the IMF loan law is enacted, and the government is reviewing 67 loss-making state firms for closure. The legacy lithium contracts with Russian and Chinese firms remain stalled in Congress and courts.
Bolivia: MAS Split, Dollar Shortage, Lithium Deals — 2026-09-27
Top developments
Morales ultimatum: repeal diesel decree by 3 October
Wanted on an arrest warrant, former president Evo Morales has given President Rodrigo Paz until 3 October to repeal the diesel decree, threatening mass protests and road blockades from 13 October if he does not. The confrontation cements Morales's shift into open opposition against Paz's reform agenda, setting up a combustible October for the country's transport routes and fuel supply chains.
Diesel subsidy ends with an 83% price shock
Supreme Decree 5716 scrapped Bolivia's last diesel subsidy, raising the pump price 83% from Bs9.80 to Bs17.95 per litre (about US$1.63 at the central bank rate) as of 19 September, tied to an international reference price with a 5% band. Intercity bus fares jumped up to 125%, unions threaten blockades, and fuel queues have meanwhile begun to shrink. Gasoline still retains its subsidy for now.
IMF loan law enacted, congressional backing secured
Congress backed a US$1.9 billion IMF loan a day before the diesel decree, and Paz has now enacted the enabling law. The Catholic Church has offered to mediate as transport groups split over a diesel strike — a sign that the government's IMF anchor is in place even as street resistance builds.
67 state companies under closure review
Under Decree 5727, the Paz government has prioritized winding up loss-making state companies: 67 firms are under review as losses mount, and public-sector unions have declared a state of emergency. The measure marks the most aggressive dismantling yet of the state-led economic model built during two decades of MAS rule.
Paz pitches open economy abroad
In his debut UNGA speech (24 September), Paz declared that socialism "doesn't put food on the table," and his government is now courting US and private investment in lithium, natural gas and agriculture — signaling the pivot away from the Russian and Chinese state-led lithium contracts that remain blocked in Congress and by court proceedings.
Local view
- Unitel reports the Central Bank of Bolivia (BCB) has moved publication of the official dollar rate to 23:30 (from 20:00) under the flexible exchange-rate regime introduced after the float.
- Infobae (25 September) notes the diesel decree closes a transition that began in December 2025, with the gasoline subsidy still pending and uncertainty growing over the economic impact.
- Red Uno reports the parallel dollar is "moving again" after the subsidy removal pushed rates back up, remaining above the official rate with buy/sell spreads widening.
- El Diario frames the week locally as dominated by the diesel price increase, transport costs and the dollar.
Context & numbers
- Diesel price: Bs17.95 per litre (about US$1.63) from 19 September, up 83% from Bs9.80 under Decree 5716
- Net international reserves: US$4.14 billion at end-August 2026 (mostly gold, ~85%), recovering from US$3.63 billion at end-July
- Twelve-month inflation fell to 5.02% in August 2026, partly a base effect against mid-2025's price spike
- IMF support: US$1.9 billion loan approved by Congress and enacted into law this month
- Intercity bus fares rose up to 125% after the diesel hike
On the radar
- 3 October: deadline of Evo Morales's ultimatum to repeal the diesel decree
- 13 October: threatened start of blockades/mobilizations if the decree stands
- The gasoline subsidy remains in place — its removal is the likely next flashpoint
- The stalled YLB lithium contracts with Russia's Uranium One Group and Chinese consortiums remain frozen in the legislative assembly while the constitutional court reviews a challenge — any movement would reshape the Uyuni investment landscape, though no fresh developments emerged this week.
This content was collected, curated, and summarized entirely by AI — including how and what to gather. It may contain inaccuracies. Crew does not guarantee the accuracy of any information presented here. Always verify facts on your own before acting on them. Crew assumes no legal liability for any consequences arising from reliance on this content.
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