Bolivia: President Fires Economy Minister Amid Crisis

Bolivian President Rodrigo Paz signed a decree on August 8 dismissing Economy Minister Jose Gabriel Espinoza, according to a publication in the government gazette. Oscar Mario Justiniano Pinto has been appointed as acting economy minister until a permanent replacement is named, though the decree does not specify when that appointment will occur.

The dismissal follows a vote by Bolivia's Congress to censure Espinoza on August 5 for failing to appear before the legislature to answer questions on the economy. Under the country's constitution, a vote of censure can lead to removal from office. Paz's administration had previously said it would challenge the decision while courts reviewed the dispute, but the August 8 decree indicates the president changed his stance.

Analysts view the move as a concession by President Paz, who faces public anger over the severe cost-of-living crisis in this South American nation.

Bolivia has experienced years of economic and political turmoil. Paz, a former senator, won the presidency last October on a pledge to restore stability. His inauguration in November marked the end of nearly two decades of rule by the Movement Toward Socialism (MAS) party, as he ran on a platform dubbed "capitalism for all."

Paz's victory stemmed from concerns over Bolivia's economy. The country, once a major fuel exporter, has seen natural gas output decline due to mismanagement, depleted reserves, and a lack of new exploration. Reduced foreign currency earnings have weakened foreign exchange reserves, leading to further instability.

As of 2024, more than 37% of Bolivia's population lives below the national poverty line. In December last year, Paz's government eliminated long-standing fuel subsidies, triggering a wave of protests. A land reform policy signed in April also sparked public unrest, with rural and indigenous voters fearing it would weaken protections for small landowners.

Paz eventually reversed the policy the following month, but throughout May and June, the country was gripped by blockades, marches, and demonstrations, with some calling for the president's resignation. He declared a state of emergency in June, and Congress approved the use of the military to clear blockades.

The firing of Minister Espinoza comes as Paz seeks congressional support for a series of economic reforms and an IMF financing program. Opposition lawmaker Roland Pacheco said the decision shows Paz "displaying humility and adherence to the constitution."

Paz's government continues to face domestic pressure as supporters of former President Evo Morales remain opposed to the new administration. In July, a Bolivian court issued an arrest warrant for Morales on charges of encouraging his followers to stage an "armed uprising" in June, along with a separate warrant for statutory rape. In a social media post, Morales accused the government of targeting him "to hide the real tragedy Bolivia is experiencing: a deep economic and social crisis... a model that abandons people and protects corruption."