The coup attempt denounced by President Luis Arce reflects the complex situation that Bolivia is going through. The president’s denunciation occurred after soldiers and military vehicles took control of Plaza Murillo in the Bolivian administrative capital, La Paz, and gained access to the Palacio Quemado, the former seat of government.
The military actions were led by General Juan José Zúñiga, who had recently been dismissed as head of the Army after making statements against former President Evo Morales.
Zúñiga based his attack on the press on the “situation of the country” and added that the Armed Forces intended to “restructure democracy.”
Although the military uprising was controlled hours later – and Zúñiga was arrested – Bolivians are living hours of uncertainty.
The episode, condemned by all political sectors, is an example of the growing tension that has gripped Bolivia in recent months.
What factors have fueled this tension? Here we tell you.
1. Political struggle between Luis Arce and Evo Morales
The attempted coup denounced by Arce is the latest episode in the turbulent political history of Bolivia.
In its 200 years of history, the Andean country has faced different military uprisings and uprisings that have made Bolivian leaders tremble.
The causes have been diverse, as have the political scenarios in which they have occurred.
This time, General Zúñiga’s attack was preceded by an escalating power struggle between former President Evo Morales and his successor, Luis Arce.
This has caused a split in the Movement towards Socialism (MAS), the ruling party.
The rift became apparent in September 2023, when Morales announced his presidential candidacy for the 2025 elections, openly challenging Arce, who is expected to seek re-election.
The former president accused the government of trying to stop his candidacy. And he has threatened that there will be a “convulsion” in Bolivia if he is disqualified.
Evo Morales led the country for almost 14 years until he had to leave in 2019 after elections that were marked by accusations of fraud.
The leader denounced a coup d’état with the support of the United States and went into exile.
After an 11-month interim government, Luis Arce achieved a decisive victory in the October 2020 elections, thus paving the way for the return of the former president.
But the enthusiasm only guaranteed a few months of calm, because soon the division began to grow between the two MAS leaders. To the point that the party this year celebrated its 29th anniversary divided – in separate events – with the “evistas” in Santa Cruz and the “arcistas” in La Paz.
The political struggle has moved to Congress, where Arce lost the majority due to the split of the MAS.
Political scientist Fernando Mayorga explained to BBC Mundo in September 2023 that the fracture of the ruling bloc caused parliamentarians close to Morales to advance agreements with the opposition to block executive decisions or censure ministers, which has made Arce uncomfortable for months.
All of this has led to the government accusing Morales of provoking a “structural crisis scenario in the country” in order to “shorten” Arce’s mandate.
“Evo Morales is willing to block our economy and convulse our country to impose his candidacy by fair means or foul, as he himself has said,” declared the Minister of the Presidency, María Nela Prada, in a press conference held on Sunday, June 23.
Morales, for his part, wrote on his X account (formerly Twitter) that “the real conspiracy against the government lies in the incapacity and corruption of its officials. “The people need trust in their authorities and solutions to their problems.”
Arce, for his part, has said in various public statements that he is the target of a “soft coup” aimed at “shortening mandates” and which is being pursued by Morales’ followers, to which the former president has said that “the only ones who talk about shortening the presidential mandate are the members of the government themselves.”
Following the military uprising that took place on Wednesday in La Paz, General Zúñiga – who has been described as close to Luis Arce and the mining and union sectors – accused the president of staging a “self-coup” to “boost his popularity.”
2. Deterioration of the Bolivian “economic miracle”
All of this political struggle occurs at a very complex economic time for Bolivia.
Road blockades and demonstrations have gained strength in recent months due to the deterioration of its economy, which, paradoxically, has stood out within Latin America in the last decade due to its rapid growth, stability and ability to contain inflation.
Some even called it “the Bolivian economic miracle.”
But this model showed its cracks in March 2023 when a serious shortage of dollars became evident and long queues of citizens began to appear on the streets trying to obtain the currency.
“The availability of dollars is becoming less and less. Before, I could withdraw whatever I wanted, but today they only allow me $100 dollars a day,” Marcelo Pérez, a photographer and journalist who lives in La Paz, tells BBC Mundo.
This has given way to a parallel market for dollars, explains Bolivian economist and international financial consultant Jaime Dunn.
“I have personally estimated that we have 13 types of parallel changes, both formal and informal,” he told BBC Mundo.
Although Arce’s government has insisted that the economy remains stable – and has blamed what happened on “a speculative outbreak” – many experts warn that the problem is much deeper.
And it is explained, in part, by the drop in the level of natural gas production that gave the country considerable income after Evo Morales decreed the nationalization of hydrocarbons in 2006.
“Since 2014, the effect of that bonanza began to reverse and this caused the level of dollars arriving in the country to drop,” says Dunn.
In parallel, international reserves decreased considerably.
According to reports from the Central Bank, these rose from US$15,122 million in 2014 to US$1,796 million in April 2024 (date on which the last report was published).
These resources have been used to maintain some of the social programs of the governments of Evo Morales first and Luis Arce later, such as the subsidy for the purchase of fuel, which Bolivia has to import and pay in dollars on international markets.
“This has led the country to a crisis because, despite the fact that income fell, very high spending remained. And since 2014, natural gas revenues began to be replaced by internal and external debt,” explains Jaime Dunn.
The shortage of dollars has especially had an impact on sectors that import or export goods.
“Bolivia is almost 80% an importer of inputs and capital goods, which is why it has been greatly affected by the shortage of dollars,” Claudia Pacheco, president of the College of Economists of Santa Cruz, tells BBC Mundo.
According to Marcelo Pérez, this can already be felt on the streets, with the rise in the price of some basic products such as rice or tomatoes.
“In the supermarket, some products have increased in price and others have directly disappeared because they can no longer import them as frequently as they did before,” he says.
In recent days, however, the vice minister of defense of user and consumer rights, Jorge Silva, stated that the price of these products had been stabilized.
The shortage of dollars has also directly affected fuel imports.
Bolivia imposed a subsidy on the purchase of fuel more than 15 years ago, which has meant a heavy expenditure on its public accounts.
Now, experts warn, he does not have dollars to buy it. This is problematic if one considers that, according to President Arce himself, Bolivia imports 56% of the gasoline and 86% of the diesel it consumes.
“Bolivia has gone from being a net energy exporter to an importer, having been a kind of energy hub for South America just 10 years ago,” says Jaime Dunn.
The Bolivian president has acknowledged that the diesel situation is “pathetic.”
According to him, it is due to a “lack of a clear hydrocarbon policy in the country” in recent years.
Now, however, the president has said that they are “doing the right thing” with the approval of projects that will supposedly help guarantee gas, diesel and gasoline reserves.
3. Discontent among Bolivians
The above has generated discontent in the population. Merchants and transporters have held demonstrations and road blockades in different cities across the country.
Meanwhile, a multitude of street vendors have marched to La Paz denouncing the shortage of dollars and fuel.
“In 2023 we had almost 200 days of blockades, which harmed imports and exports,” says Claudia Pacheco.
Long lines of people trying to get fuel have formed at gas stations. Given this, President Arce ordered the militarization of the fuel supply system.
“There are days when diesel is sold, but others when not. “Sometimes you have to sleep at gas stations to get it,” one driver told the news agency. Reuters.
The situation has led the government to introduce measures to combat these problems.
In February, the Minister of Economy, Marcelo Montenegro, met with business groups and announced a series of economic reforms such as the relaxation of export restrictions and the creation of a diesel auction for large producers.
So far, however, the measures do not seem to be enough.
The tension generated by these episodes has also hit Arce’s popularity, who has dropped in approval, according to polls.
If he chooses to run in the 2025 election, this may be a problem.
His greatest challenge, according to analysts consulted by BBC Mundo, is to resolve the country’s economic problems, which is paradoxical for someone who experts describe as the “father of the economic model” in force in the country.
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