Template-Type: ReDIF-Paper 1.0
Author-Name: Lucas Lamby
Author-Workplace-Name: Center for International Development at Harvard University
Author-Name: Lucila Venturi
Author-Name: Jose Ignacio Hernandez
Author-Name: Ricardo Hausmann
Author-Email: ricardo_hausmann@harvard.edu
Author-Workplace-Name: Harvard's Growth Lab
Author-Person: pha552
Title: Bolivia’s Economic Pivot: Reviving the Energy Sector
Abstract: Bolivia’s energy system is in structural decline. Natural gas production has fallen 54% since its 2014 peak, collapsing export volumes and turning hydrocarbons from a fiscal engine into a net drain on reserves. The cause is institutional, not geological: the 2005–2009 nationalization cycle increased state revenue capture during the commodity boom but weakened the incentives for long-term exploration. Fuel and domestic gas subsidies compounded the problem, distorting price signals and crowding out renewable investment. The current administration’s January 2026 fuel reform raised diesel prices by 163% and gasoline by 86%, but the heightened global oil prices have displayed the remaining structural weakness and domestic gas subsidy remains untouched, costing Bolivia over $900 million in forgone export earnings in 2025 alone. The reform agenda requires three priority actions: embedding fuel prices in a rules-based formula; restructuring hydrocarbons contracts to restore exploration incentives; and accelerating renewable energy deployment to free up natural gas for export.
Creation-Date: 2026-04
Keywords: Bolivia, energy
Number: 263
Handle: RePEc:glh:wpfacu:263
File-Url: https://growthlab.hks.harvard.edu/wp-content/uploads/2026/05/2026-04-glwp-263-bolivia-economic-pivot-energy-spanish.pdf
File-Format: application/pdf
File-Url: https://growthlab.hks.harvard.edu/wp-content/uploads/2026/05/2026-04-glwp-263-bolivia-economic-pivot-energy-english.pdf
File-Format: application/pdf