Economy of Bolivia

The economy of Bolivia is the 89th-largest in the world in nominal terms and the 90th-largest in purchasing power parity. Bolivia is classified by the World Bank to be a lower middle income country. With a Human Development Index of 0.703, it is ranked 114th (high human development). Driven largely by its natural resources, Bolivia has become a region leader in measures of economic growth, fiscal stability and foreign reserves, although it remains a historically poor country. The Bolivian economy has had a historic single-commodity focus. From silver to tin to coca, Bolivia has enjoyed only occasional periods of economic diversification. Political instability and difficult topography have constrained efforts to modernize the agricultural sector. Similarly, relatively low population growth coupled with low life expectancy has kept the labor supply in flux and prevented industries from flourishing. Rampant inflation and corruption previously created development challenges, but in the early twenty-first century the fundamentals of its economy showed unexpected improvement, leading Moody's Investors Service to upgrade Bolivia's economic rating in 2010 from B2 to B1. The mining industry, especially the extraction of natural gas and zinc, currently dominates Bolivia's export economy.

Between 2006 and 2019 (term of the presidency of the democratic socialist Evo Morales), GDP per capita doubled and the extreme poverty rate declined from 38% to 18%. The poverty rate declined from 22.23% in 2000 to 12.38% in 2010. Moreover, the Gini coefficient declined from 0.60 to 0.446. According to the Bolivian Institute of Foreign Trade, Bolivia had the lowest accumulated inflation of Latin America by October 2021. However, by late 2024 it had one of the highest rates of inflation in the region, amid a new, large-scale economic crisis.