IMF announces $1.9 billion loan for Bolivia

The International Monetary Fund (IMF) has announced a significant $1.9 billion loan package for Bolivia, structured as a 36-month extended fund facility (EFF). This program, negotiated by an IMF mission and pending board approval, is designed to bolster the economic reform agenda of President Rodrigo Paz's administration.

Extended fund facilities are IMF instruments for member countries grappling with medium-term balance of payments issues, offering longer repayment periods compared to other loan types. The IMF stated that this support is anticipated to catalyze further financing exceeding $5 billion from institutions like the World Bank and the Inter-American Development Bank, creating a comprehensive financial package.

Bolivia has recently encountered substantial macroeconomic hurdles, including a fiscal deficit, a decline in oil production, dwindling foreign exchange reserves, and high inflation, according to the IMF mission that led the negotiations. The government of the conservative Rodrigo Paz, which took office in November 2025 after two decades of left-wing rule, has faced considerable opposition, notably from former President Evo Morales.

The IMF highlighted that the new administration has initiated a "determined reform plan." The IMF-backed program aims to support these efforts, rebuild economic resilience, and guide the country toward sustainable growth. Key objectives include reducing the public debt-to-GDP ratio, maintaining social protection spending, modernizing monetary and exchange rate regimes, and enhancing financial sector supervision and competitiveness.