Bolivia Scraps Fuel Subsidies After 20 Years

Bolivia’s new president, Rodrigo Paz, announced on Wednesday that his government will eliminate fuel subsidies, ending two decades of fixed gasoline and diesel prices introduced by previous leftist administrations.

In a televised address alongside his ministers, Paz said a decree would soon be published to announce new hydrocarbon prices, describing the move as necessary to restore economic order.

“Removing poorly designed subsidies from the past does not mean abandonment. It means order, justice, clear redistribution,” he said.

Bolivia currently imports gasoline and diesel at international prices and resells them domestically at a loss, a policy that has severely strained state finances. The country is facing its worst economic crisis in 40 years, with fuel subsidies draining foreign currency reserves.

Since 2023, persistent fuel shortages have led to long queues at filling stations, with motorists sometimes waiting days for supplies.

Paz said diesel will be removed from government price controls and placed on the open market to encourage private-sector imports. He added that the subsidy system had been abused to conceal corruption and fiscal mismanagement.

According to the president, the reforms will help stabilize prices, curb losses, and generate additional government revenue to support broader economic recovery.