Includes how major projects are financed and gives examples where relevant. Explains activities of the multilateral development banks in and other aid-funded projects where procurement is open to U.S. bidders.
Last Published: 7/13/2019

Credit is generally difficult to obtain locally without using unencumbered local assets as collateral.  Interest rates are influenced by the Central Bank’s monetary policy, as well as by high administrative costs resulting from general operational inefficiency of local banks.  Still, the impact of the Central Bank's monetary policy is moderate due to the dollarization of the economy (approximately 18 percent of deposits and five percent of credits are denominated in U.S. dollars).  Although there are no formal restrictions on foreign companies’ borrowing locally, few large investors do so because of the financial system’s limited capacity.

Credit is allocated on market terms, but foreign investors may find it difficult to qualify for loans from local banks due to the requirement that domestic loans be issued exclusively against domestic collateral.  Since commercial credit is generally extended on a short-term basis at high interest rates, most foreign investors prefer to obtain credit abroad.  Most Bolivian borrowers are small and medium-sized enterprises (SMEs).

Established Bolivian firms may issue short or medium-term debt in local capital markets, which act primarily as secondary markets for fixed-return securities.  Bolivian capital markets have sought to expand their handling of local corporate bond issues and equity instruments.  With greater frequency since 2009, several Bolivian companies and some foreign firms have been able to raise funding through local capital markets.  The stock exchange is small, with the amount of total transactions a year hovering around one third of the GDP, and highly concentrated in bonds and debt instruments (more than 95 percent of transactions).  Most companies do not issue stocks.

The Overseas Private Investment Corporation (OPIC) and U.S. Export-Import Bank (EXIM) do not currently operate in Bolivia.
 

Multilateral Development Banks

The Commercial Service maintains Commercial Liaison Offices in each of the main Multilateral Development Banks, including the World Bank and the Inter-American Development Bank.  These institutions lend billions of dollars in developing countries on projects aimed at accelerating economic growth and social development by reducing poverty and inequality, improving health and education, and advancing infrastructure development.  The Commercial Liaison Offices help businesses that create U.S. jobs learn how to get involved in bank-funded projects and how to connect to other parts of the International Trade Administration, including the U.S. Field; the overseas network of Commercial Service offices; and, in Washington, desk officers, sectoral experts and the Advocacy Center.
 

Web Resources

Commercial Liaison Office to the Inter-American Development Bankhttp://export.gov/idb

Prepared by our U.S. Embassies abroad. With its network of 108 offices across the United States and in more than 75 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.