- IMF staff and the Bolivian authorities have reached a staff-level agreement on a new Extended Fund Facility (EFF) arrangement to support the authorities' comprehensive economic reform program. The agreement is subject to IMF Executive Board approval.
- The authorities' reform program seeks to restore macroeconomic stability, rebuild international reserves, reduce fiscal and external vulnerabilities, strengthen social safety nets, and foster sustainable, private sector-led growth. The authorities aim to implement an ambitious structural reform agenda, including measures to protect vulnerable households, strengthen governance and transparency, modernize monetary and exchange rate frameworks, and enhance financial sector resilience.
Washington, DC: An International Monetary Fund (IMF) staff team led by Ms. Joana Pereira held discussions with the Bolivian authorities in Bolivia and in Washington, D.C. between May and July 2026. At the conclusion of the discussions, Ms. Pereira issued the following statement:
"The Bolivian authorities and IMF staff have reached a staff-level agreement on a 36-month arrangement under the Extended Fund Facility (EFF) of about US$1.9 billion, equivalent to SDR 1369 million, or 570 percent of quota, to support the authorities' economic reform program. The agreement is subject to IMF Executive Board approval and contingent on the implementation of agreed prior actions.
"The IMF-supported program is expected to help catalyze additional financing from the World Bank, the Inter-American Development Bank, and other development partners, contributing to a broader financing package of over US$5 billion over the program period.
"Bolivia has faced significant macroeconomic challenges in recent years, driven by persistent fiscal deficits, declining hydrocarbon production, dwindling international reserves, high inflation, and distortions in foreign exchange and product markets. These imbalances have constrained economic activity, heightened external vulnerabilities, and eroded real incomes. The new administration has launched a decisive reform plan to address these challenges and restore macroeconomic stability. The IMF-supported program is designed to back these efforts, rebuild resilience, and help put the economy on a job-rich and sustainable growth path."
"The key elements of the Bolivian authorities' program include:
"Restoring fiscal sustainability. Fiscal reforms will aim to place the public debt-to-GDP ratio on a firm downward trajectory. The necessary improvement in the non-financial public sector balance will focus on expenditure rationalization--by enhancing the targeting and efficiency of spending, while increasing social protection-as well as mobilizing revenues and strengthening fiscal institutions to support planning, public financial management, transparency, and accountability.
"Strengthening social safety nets. Additional budgetary resources will be allocated to social protection spending to ensure that fiscal consolidation does not fall on the poor and most vulnerable. Efforts will also focus on improving the delivery and targeting of social programs, raising the effectiveness of the social safety net, reducing informality, and creating better job opportunities.
"Modernizing the monetary and exchange rate regime. The authorities' recent measures to adjust monetary policy, strengthen the monetary framework, and move toward a more flexible exchange rate regime are essential to support price stability, eliminate foreign exchange market distortions, and rebuild international reserves. Reforms will continue to support the development of a market-based exchange rate system and strengthen monetary policy effectiveness, as the first steps towards the future adoption of an inflation targeting regime. The authorities remain committed to maintaining zero monetary financing of the fiscal deficit and strengthening central bank governance and operational autonomy.
"Building financial sector resilience. Steps will be taken to strengthen financial sector supervision and crisis preparedness. Reforms will focus on aligning Bolivia's regulatory and supervisory standards with international best practices, improving bank resolution and deposit insurance frameworks, enhancing the monitoring of bank and system-wide risks, including through stronger inter-agency coordination, deepening financial markets, and reinforcing anti-money laundering and counter-terrorism financing frameworks.
"Enhancing competitiveness, governance, and productivity. The authorities will advance holistic reforms to improve the business environment, reduce product market distortions, and strengthen institutions. Measures will also seek to improve public investment efficiency and strengthen legal frameworks to promote private investment, thereby unlocking Bolivia's growth potential. The program will also support efforts to strengthen accountability, improve public procurement practices, and reinforce anti-corruption frameworks.
"The IMF team would like to thank the authorities and other counterparts for the constructive and productive discussions. Following implementation of the agreed prior actions, the arrangement will be submitted to the IMF Executive Board for its consideration."
