Bolivia scraps fuel subsidies to shore up public finances
Bolivian President Rodrigo Paz has announced the removal of long-standing fuel subsidies as part of efforts to stabilise the country’s strained public finances.
Speaking in a nationwide address on Wednesday, Paz said the decision was aimed at restoring order and fairness in public spending rather than abandoning social responsibility. He said the move would introduce a more transparent and equitable system of redistribution.
Although full details are expected in a forthcoming government decree, the subsidy removal appeared to take immediate effect for the agriculture and business sectors, which Paz had earlier identified as the initial focus of the reform.
The president also said his administration would allow direct imports of diesel, citing supply challenges faced by the state-run oil company, Yacimientos Petrolíferos Fiscales Bolivianos.
Bolivia has kept fuel prices frozen since 2006. Under the new policy, the price of diesel has risen from 3.72 bolivianos per litre to 9.80 bolivianos, while premium gasoline now sells for 6.96 bolivianos per litre, up from 3.74 bolivianos.
Oil and Gas Minister Mauricio Medinaceli said the new prices would remain fixed for six months, though further adjustments were not ruled out.
Paz, who assumed office last month, inherited an economy under pressure and faces difficult negotiations in parliament to pass reforms that economists say are necessary to restore fiscal stability.
Comments
This post currently has no comments.