Press Release: IMF Managing Director Rodrigo de Rato's Statement at the Conclusion of his Visit to Bolivia
February 18, 2005
"I am delighted to be in La Paz today as part of my visit to the Andean region. I had the privilege of meeting President Mesa, members of his Cabinet, including Minister of the Presidency José Antonio Galindo, Minister of Finance Luis Carlos Jemio, Minister of Economic Development Walter Kreidler, Central Bank President Juan Antonio Morales and Superintendent of Banks Fernando Calvo. Earlier today, I met with key congressional leaders, President of the Senate Hormando Vaca Díez and President of the Chamber of Deputies Mario Cossio, and with other political leaders, and civil society representatives. Tonight I shall meet with private sector representatives.
"In my discussions with President Mesa and with his economic team, we focused on the challenges of building wider consensus among Congress, and social and private partners, for an economic agenda that would make full use of Bolivia's rich natural resources and deliver macroeconomic stability sustained growth, and reduced poverty. Bolivia is at an important juncture in its history. It has met difficult economic and political challenges. Bolivia's economic program, supported by a Stand-By Arrangement from the Fund has preserved much-needed short term stability. Against a background of a strong world economy and the best regional growth performance in a decade, Bolivia's economy has strengthened significantly, while inflation has remained in single digits.
"Nevertheless, crucial challenges remain. It will be critical to take advantage of the favorable world economy to move forward and forge consensus on policies aimed at reviving investment and addressing social concerns as part of the process of establishing the basis for sustained growth. In particular, sound management of Bolivia's rich hydrocarbon resources will be crucial to develop the economy to the benefit of all. New investments will be essential for this purpose, inevitably involving the private sector, and within a transparent and efficient framework. Bolivia's rich natural resources, if well managed, hold the promise of raising living standards and reducing poverty.
"We agreed that, in light of Bolivia's still high debt burden, the government's fiscal program must aim at bringing down Bolivia's fiscal deficit and debt so as to entrench macroeconomic and financial stability, and sustain the current economic recovery. Congress and the private sector have a key role to play in the implementation of Bolivia's economic agenda, which can only be successfully implemented with the participation of all sectors of society.
"The IMF has been deeply engaged, along with the international community more broadly, in supporting Bolivia's efforts to bring down debt, boost growth, and fight poverty. Our programs are designed to maintain macroeconomic stability and put in place the conditions for growth, including fiscal reform and a strengthened financial system. We also support your efforts in a participatory dialogue to refine priorities for poverty reduction; and support social safety nets for the poor and the protection of pro-poor spending.
"My visit underscored the importance the IMF places on our relationship with Bolivia. A mission is currently in Bolivia discussing continued support to Bolivia's economic program under the current Stand-By Arrangement. Looking ahead, we hope that a broad consensus can be reached as soon as possible among the authorities and social partners in developing a set of policies, especially of natural resource use, that could be supported by a three-year Poverty Reduction and Growth Facility arrangement."