As an alternative to the neoliberalism applied in Bolivia from 1985, that deepens inequality among Bolivians, Evo Morales government applied since
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1 TERCERA EDICIÓN
2 As an alternative to the neoliberalism applied in Bolivia from 1985, that deepens inequality among Bolivians, Evo Morales government applied since 2006, the New Economic, Social, Communitarian and Productive Model, that is born from a theoretical contemplation of intellectuals that see the model as economic and social because privilege social objectives rather than individuals. In this news card, the Ministry of Economy and Public Finances makes a practical explanation of the new economic model and its results during the last six years. 02
3 Why do we need a new economic model? Because nowadays the world and the capitalist system is in crisis. The weather is changing drastically, a prove of this are the natural disasters around the world. Therefore there is a Cimate Crisis The unwise economic policies from richer countries have made the bubble of an apparent economic stability pop, therefore there is a World Financial Crisis. The energy sources, as oil, electricity and other natural resources a r e worn out And its Price goes up. There is a Energy Crisis The crisis of the predominant Economic Theory is a Macroeconomic Crisis. THE TOTALITY OF THESE PROBLEMS ARE KNOW AS THE CAPITALISM STRUCTURAL CRISIS The food produced in the planet is not enough for all human beings, is distributed wrong and its price also starts to go up. The world suffers a Food Crisis. 03
4 If the problem is like the world thinks, nowadays, a way is missing. The New Economic Model in Bolivia is exactly that, a new way to think that considers interests and needs of all, before the market ones. It is an alternative to capitalism. The 04 economy is planned considering the needs of all. NOW The economy is managed under the market needs BEFORE
5 What are the differences between the New Economic Models? The main differences are: The market is the main mechanism to direct resources were they are needed. The state just observes this process. The main objective of the economic policy was to maintain the macroeconomic stability. Investment is centered in the private businesses and is just worried about the external demand. As a consequence of all the above the main worry is to export raw materials. Access of transnational enterprises is eased for the exploitation of natural resources. BEFORE NOW 1. - The state assigns resources and distributes the income to avoid inequalities The state nationalize its natural resources therefore having control over what is done at the more strategic sectors. 3.-The state integrates all the sectors in the investment activating the external demand and the domestic demand as an engine for growth The state main worry is the industrialization of the natural resources and the productive development. 05
6 How does the New There is two kinds of sectors generate surplus and the SECTOR GENERATING SURPLUS HYDROCARBONS STATE RED MINING ELECTRICITY 06 ENVIROMENTAL RESOURCES With the economic by these sectors All Bolivians redistribution such as: Bonus Juancito
7 Economic Model work? At the economy the ones that Ones that generate income and jobs INDUSTRY SECTOR GENERATING INCOME AND GROWTH MANUFACTURING AND CRAFTS ISTRIBUTES Resources generated the state benefits to through the social programs Pinto, Dignity Rent.. FARMING DEVELOPMENT HOUSING TOURISM COMMERCE, TRANSPORT SERVICES AND OTHER SERVICES 07
8 What is Plural Economy? Promotes Integration of all productive economic forms to achieve a global economic development. PLURAL ECONOMY It is in charge of promoting integration of all economic ways of production aiming to achieve the social and economic development. Generates employment, production and services, helping to boost the economic independence PRIVATE 08 ECONOMIC GROWTH WITH INCOME REDISTRIBUTION Generates production and jobs. Is founded on the principles of hard work, solidarity and cooperation. SOCIAL También genera producción y empleo. Se rige sobre los principios de trabajo solidario y cooperación. COMUNITARIAN COOPERATION
9 Is the New Economic Model better than the Old one? When put in practice the New Model, there Was an important improvement in the economic indicators In Bolivia, in relation with the Neoliberal Model. Net International Reserves: Our International Reserves, that are the country s savings for difficult times, went up from USD millions in 2005, to USD millions until March benefited, within the frame of the income redistribution with the payment of the Bonus Juancito Pinto, Juana Azurduy and Dignity Rent until December march Reduction on poverty levels, Bolivia registe4red a mild poverty reduction of 60, 6% in 2005 to 48,5% in And from 3 8, 2 % of extreme poverty in 2005 to 24,3% in 2011 MILD POVERTY EXTREME POVERTY (En porcentaje) (En porcentaje) 38,2 60,6 51,3 3, 3 million people were Bonus payment: Exports: Bolivia exported a value of USD million between 1985 and to USD million between ,6 48, ,1 25,4 24, Fiscal surplus: After 66 years that Bolivia registered fiscal déficit, now we have fiscal surplus, so the country has more resources than it spends. +4,5% +3,2% +1,7% +1,7% +0,8% +0,1% Prom ,0% Jun-2011 Bolivianization From 2006 the local currency was boosted. In contrast with the neoliberal period where most of the credits and deposits were in USD Now 72% of the credits And 65% of the deposits are in bolivianos. 09
10 Is the New Economic Model recognized overseas? Yes. The New Economic Model implementation results from 2006 have received recognition overseas. Many International organizations have expressed favorable opinions in relation to the economic management that is carried out in the country. March 2012: Latin American Development Bank (CAF) and the United Nations (ONU) Both highlighted the economic stability in Bolivia and the positive indicators in the last years despite the international crisis and rated the economic growth forecasted for this year as positive. December 2011: Economic Commission for Latin America and the Caribbean (CEPAL) Through its Executive Secretary, Alicia Bárcena, pointed out a clever economic policy in Bolivia, the historic reduction in the poverty reduction, high investment levels in the country and the implementation of a cautious macroeconomic policy. November 2011: International Monetary Fund (FMI) In the report Economic Outlook for Latin America the FMI pointed out that Bolivia coped better than other countries with the international crisis and that carries on growing in sectors such as, financial services and farming thanks to a strong domestic demand and reduction in the inflation. June 2011: Inter American Development Bank (BID) and World Bank (BM) 10 The BID Bolivia in in an expectant position in the regional economy a n d has a positive macroeconomic situation with very cautious macroeconomic management.the BM highlighted the social bonus policy implemented by the National Government. Considering that this is an investment in social capital.
11 Did the New Model get better results? Yes. Las Calificadoras de Riesgo destacaron el esfuerzo de la economía boliviana y subieron la calificación de riesgo del país. RISK RATING AGENCIES UPGRATED BOLIVIA S RATING FOR THE RESULTS OF THE APPLICATION OF THE NEW ECONOMIC MODEL MOODY S FITCH RATING INVESTORS SERVICE + B Stable Oct. 18th2011 B1 Dic.- 12th2011 Positive STANDARD AND POOR S + B Positive August-22nd-2011 The three institutions granted a better rating because of the macroeconomic stability and the good economic performance during the crisis, for accumulated reserves fiscal savings and the favorable position of the debt ratio. 11
12 Abril 2012 ilustración.josé Luis Arano Social Comunication Unit Teléphono/Fax: Edi cio Palacio de Comunicaciones La Paz, piso 19 Av. Mariscal Santa Cruz esq. Oruro diseño.unidad de Comunicación Social Ministry of Economy and Public Finances Teléphono:
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