Economy, Mining, Manufacture, and Trade
COMIBOL, MERCOSUR, tin mines, LAIA, leather working
Mining, a major industry in Bolivia, was hampered in the late 1980s by weak prices on world markets. Bolivia has long been one of the world’s leading producers of tin. In 1952 its three major tin-mining operations were nationalized under the Corporacion Minera de Bolivia (COMIBOL). Most of the tin mines are located in the vicinity of Oruro; the output of tin concentrates in 2000 was 12,464 metric tons. Also mined are gold, zinc, lead, antimony, tungsten, and silver. Petroleum and natural gas production increased in importance in the 1960s and early 1970s; by the early 1990s Bolivia was self-sufficient in petroleum and was exporting significant amounts of natural gas to Argentina.
Manufacturing enterprises are on a small scale. The manufacture of cement and the refining of sugar and flour are Bolivia’s major industries. Smaller industries include leather working, tobacco processing, and the manufacture of chemicals, paper, furniture, glass, explosives, and matches. More than two-thirds of all manufacturing is in La Paz, which is also the center of domestic trade. In 2000 industry, which includes mining, manufacturing, and construction, accounted for 15 percent of the GDP. Industry employed 29 percent of the workers.
Although Bolivia has long been dependent on mineral exports, declining tin prices and increased petroleum and natural gas production changed the nature of the country’s economy in the 1980s. By the early 1990s, natural gas accounted for 27 percent of export earnings while tin provided just 12 percent. Zinc, silver, gold, lead, and antimony are other important mineral exports. Soybeans, wood, and sugar are also exported. Bolivia’s imports consist mainly of machinery, motor vehicles, electric equipment, and manufactured goods. In 2000 imports totaled $1.8 billion, and exports earned $1.2 billion.
The principal purchasers of Bolivia’s exports are the United States, the United Kingdom, Peru, Colombia, Argentina, Germany, The Netherlands, and France. Chief suppliers of imports are the United States, Brazil, Japan, Argentina, Chile, Peru, and Germany. Ties with Andean Group partners are also important to Bolivia’s trade; these partners include Colombia, Ecuador, Peru, and Venezuela. Founded in 1979, the group works toward common policies on energy, tariff reduction, industrial and agricultural development, political cooperation, improved internal and international trade, and the creation of a common market. Bolivia is also a member of the Latin American Integration Association (LAIA), an organization with many of the same goals as the Andean Group, but on a wider scale. In 1996 Bolivia joined the Southern Cone Common Market (known by its Spanish acronym, MERCOSUR), a trade group dedicated to lowering tariffs and removing other trade barriers among its member nations. MERCOSUR—which also includes Argentina, Brazil, Paraguay, and Uruguay—covered a market of more than 190 million people in 1995, making it the world’s fourth-largest free trade group.
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