Bolivia: Bolivia is poised for a historic political shift as Rodrigo Paz prepares to assume the presidency on November 8, 2025, ending nearly two decades of rule by the Movement to Socialism (MAS) party. The centrist leader faces an unprecedented combination of economic distress and political instability that could define the country’s trajectory for years to come. Empty state coffers, soaring inflation, and a fragmented legislature present immediate challenges that will test Paz’s leadership from the outset.
Paz, a former senator representing the Christian Democratic Party (PDC), emerged victorious in a closely contested runoff election on October 19, signaling a decisive move away from MAS dominance. However, his party does not command a majority in either chamber of the Legislative Assembly. This reality requires him to engage in delicate coalition-building with diverse political factions, ranging from pro-business blocs to conservative independents. Analysts note that while some alliances could facilitate market-oriented reforms, the uncertainty of MAS-affiliated lawmakers’ support may hinder sustained progress.
Economically, Bolivia is in dire straits. Inflation has surged above 20 percent, severely eroding household purchasing power, while foreign-currency reserves are nearly depleted, complicating the import of essential goods and fuel. Production disruptions in critical sectors such as natural gas and agriculture, coupled with nationalization policies, have dampened foreign investment and slowed output. Economic experts warn that without immediate fiscal interventions, the country could face deeper shortages and social unrest.
In response to the crisis, Paz has outlined a series of urgent policy measures. He plans to reduce diesel subsidies for agriculture and business sectors and gradually phase out gasoline subsidies for public transport, aiming to stabilize government spending. Additionally, he is seeking external financing, with the International Monetary Fund (IMF) and the Inter-American Development Bank expressing readiness to support Bolivia, contingent upon legislative approval. These steps, though necessary, carry political risk and may generate public backlash if perceived as favoring international creditors over domestic needs.
Navigating a fragmented Congress is another critical hurdle. Paz has already begun engaging leaders from the pro-business Unity Alliance, forming a working majority that could help push through key economic measures. Yet, analysts caution that the coalition’s stability is uncertain, particularly given the presence of MAS-affiliated legislators whose long-term loyalty remains unclear. The success of his administration will depend on continuous negotiation and pragmatic compromise across party lines.
The stakes extend beyond Bolivia’s borders. As a major producer of natural gas and agricultural commodities, Bolivia’s economic stability has regional implications. Any disruption in energy or food supply could reverberate across South America, affecting neighboring countries and regional trade networks. Moreover, a successful transition to a centrist government may recalibrate Bolivia’s diplomatic and economic posture in the region, signaling a departure from the policies of the past two decades.
Rodrigo Paz enters office with both opportunity and peril. The first 100 days of his administration will be crucial in determining whether he can stabilize the economy, strengthen legislative alliances, and maintain public confidence. Failure to act decisively could exacerbate economic hardship and provoke social unrest, while success may open a path toward long-term reform and national recovery.
In sum, Bolivia stands at a crossroads. The inauguration of Rodrigo Paz represents a historic shift, but symbolism alone will not suffice. The country’s future will hinge on the new president’s ability to combine pragmatic policymaking with inclusive political leadership, navigating a deeply fractured landscape while addressing one of the most severe economic crises in the nation’s recent history.