Bolivia’s government has submitted to the Legislative Assembly a memorandum of understanding with the International Monetary Fund that sets out a sweeping fiscal adjustment program in exchange for $1.9 billion in external financing, to be disbursed over the next three years.
The agreement between IMF and Bolivian government establishes as its central goal reducing the fiscal deficit from the current 9.1% to 3.8% by 2028, through a roadmap built on the total elimination of state subsidies, full price liberalization, and a wage freeze across key sectors of public administration.
Among the most drastic measures is the definitive elimination of fuel subsidies, set for January 2027, following last year’s 100% fuel price hike.
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The pact also calls for the gradual phase-out of electricity and household gas subsidies, the suspension of price controls on basic food staples, the full liberalization of food exports, and foreign currency purchases from private banks by the Central Bank -a move expected to accelerate the devaluation of the national currency and drive up the overall cost of living.
Bolivia avanza hacia una economía más estable y con mayor certidumbre.
Consulta y descarga el Memorando:https://t.co/M24SnWCOcV#SiempreBolivia #MinisterioDeEconomía #MEFP #FMI pic.twitter.com/TWbcVTunLx
— Min. Economía (@EconomiaBo) September 11, 2026
Text reads: “Bolivia is moving towards a more stable and more certain economy. Consult and download the Memorandum.”
Wages Frozen Hard
Social and economic analysts have voiced concern over the scale of the adjustment, warning that the IMF’s demands shift the burden of the crisis onto the middle class and the country’s most vulnerable populations. The package explicitly freezes wages in essential state sectors, directly affecting teachers, medical personnel, police officers and members of the armed forces, while also raising interest rates on consumer and housing loans.
Although the Bolivian government plans to distribute temporary cash bonuses as a social mitigation measure against rising inflation, the memorandum itself warns of the imminent risk of a “resurgence of social unrest” driven by the erosion of purchasing power.
Approval of this fiscal agenda by the Legislature would also serve as a precondition for unlocking an additional $3 billion in loans from institutions such as the Inter-American Development Bank (IDB), the CAF development bank, and the World Bank.
Se socializa en la Asamblea Legislativa los alcances del acuerdo con el FMI
— Min. Economía (@EconomiaBo) September 10, 2026
Text reads: “The scope of the agreement with the IMF is socialized in the Legislative Assembly.”
Government Defends Deal
Despite the clearly conditioned nature of the IMF agenda, Bolivian officials have defended the agreement, framing it as an autonomous decision rooted in fiscal responsibility rather than external imposition. Authorities from the Ministry of Economy stated that the measures reflect the government’s own commitment to economic responsibility since taking office, rejecting characterizations of the deal as an IMF mandate.
Still, the memorandum expressly commits the Bolivian State to coordinate directly with IMF technical staff on setting the dollar exchange rate and on the potential introduction of new taxes. Critics argue the decision marks a retreat from the path of economic sovereignty and socially inclusive industrialization pursued in recent years, subordinating national development to the traditional structural-adjustment formulas long promoted from Washington.
The measure now heads to further legislative debate amid growing social pressure and warnings of renewed unrest.
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Once you go IMF you’re basically owned Bent over and fucked…good luck Bolivia…been a good run
