Economic Policy in Bolivia after the Transition to Democracy

The main purpose of this chapter is to examine the difficulties involved in the democratic transition in Bolivia and to point out the circumstances that led to the implementation of the liberal economic policy that forms part of the so-called New Economic Policy (NEP). The development and prospects of this policy are also discussed. The return to democracy and its institutions took place in October 1982, whereas the NEP began to be applied almost three years later, after the enactment of Supreme Decree 21060 in August 1985. The chapter covers the administrations of Hernan Siles Zuazo, President of the democratic transition, and Víctor Paz Estenssoro and Jaime Paz Zamora, who carried the NEP forward.