What's behind Bolivia’s growing protests?

On Monday, supporters of Bolivia's leftist former president Evo Morales march through La Paz, escalating the unrest which has been causing a blockage of roads for almost two weeks. This has also caused shortages in food, fuel, and medical supplies across the country.

Authorities?said that the disruptions had stranded vehicles on highways, and patients were unable to get to hospitals. Argentina sent a military plane?with food at Bolivia's request.

What is driving the 'protests? The protests that began as strikes in May have now grown to a national movement, involving unions, miners and transport workers, along with rural groups. Protesters want President Rodrigo Paz to reverse austerity and tackle rising living costs. Some even call for his resignation.

Analysts claim that the unrest is no longer confined to local grievances, but has shifted into a wider anti-government sentiment about the direction of the economy.

What are the main grievances?

The protests are centered around the increasing economic pressures. Teachers are calling for higher salaries and more funding. Transport unions, meanwhile, have started open-ended strike action due to fuel shortages. The indigenous and rural groups are opposed to agrarian reforms, which they claim favor large landowners.

Protests continue despite the government repealing an agrarian bill that was controversial this month.

How has the government responded? Paz, the new president who took office in November, inherited a tumultuous economy, and has defended fuel subsidy cuts and spending reductions, claiming that they are necessary for stabilizing public finances.

He is preparing for Congress a reform package that includes removing fuel price controls gradually and measures to increase domestic energy production.

The government has tried to ease tensions by negotiating wage increases and deploying 3,500 security personnel to remove roadblocks. About 57 people were arrested, according to authorities.

Officials blame the Morales supporters and the opposition for the blockades. They claim that the blockades have led to the deaths of at least three people, including those who were unable to get to hospitals.

What role is Evo Morays playing?

Morales who ruled Bolivia from 2006 until 2019 has supported the protests and described them as a reaction to economic hardships and political persecution.

After a judge found him in contempt earlier this month, for not appearing in court to answer a question in a human trafficking case, thousands of his supporters rallied. Morales has denied any wrongdoing.

He wrote that the uprising would not stop as long as structural needs such as food, fuel and inflation were not met.

ARE INVESTORS CONCERNED ABOUT THIS? Bolivia's sovereign debt is a thinly traded product, which has tempered the market reaction. LSEG data show that the premium investors pay for Bolivian bonds over similar U.S. Treasuries has narrowed to its lowest level since at least 2020.

Analysts warn that the risks are growing.

JPMorgan stated in a note to clients that "Bolivia is in a period where social and political stress is increasing, with an escalating strike and widespread protests."

IS THIS UNUSUAL IN BOLIVIA? Demonstrators have used road blockades for years. Similar disruptions by groups loyal to Morales, mining and rural interests, and former left-wing President?Luis Arce paralyzed transport routes at times and caused billions of dollars in losses.

Analysts believe Paz will face the challenge of stabilizing its economy and building new social and political alliances within a highly polarized climate.

Gonzalo Chavez, an economist, said: "There is no quick or easy solution in sight."

(source: Reuters)