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Andean Group - April 2023
Introduction
Queues have been forming for weeks outside Bolivia’s central bank in downtown La Paz, as the supply of US dollars available at commercial banks and traders has dried up. Monetary authorities have denied a shortage of dollars, although weeks of opacity on the extent of Bolivia’s foreign reserves have only added to fears of an impending currency crisis. For now, the worst-case scenarios – a currency devaluation or a default on dollar-denominated bond repayments – seem unlikely to materialise. Nevertheless, the government has already resorted to its special drawing rights (SDR) arrangement with the International Monetary Fund (IMF), and is looking to liquidate some of the central bank’s gold reserves. We begin this April 2023 edition of the Latin American Regional Report: Andean Group by examining this evolving situation.
