WORLD TRADE  
ORGANIZATION  WT/TPR/M/154 
16 January 2006 
 
 (06-0171) 
Trade Policy Review Body 
  
 
 
 
TRADE POLICY REVIEW 
 
BOLIVIA 
 
Minutes of Meeting  
 
Chairperson:  H.E. Mr Don Stephenson (Canada) 
 
 
  Page 
 
I. INTRODUCTORY REMARKS BY THE CHAIRPERSON 3 
II. OPENING STATEMENT BY THE REPRESENTATIVE OF BOLIVIA 4 III. STATEMENT BY THE DISCUSSANT 7 
IV. STATEMENTS BY MEMBERS 10 
V. REPLIES BY THE REPRESENTATIVE  OF BOLIVIA AND ADDITIONAL 
COMMENTS 22 
VI. CONCLUDING REMARKS BY THE CHAIRPERSON 25 
 
 
Note:   Advance written questions by WTO Me mbers and the replies provided by Bolivia are 
reproduced in document WT/TPR/M/154/Ad d.1 and will be available online at 
http://www.wto.org/english/tr atop_e/tpr_e/tp_rep_e.htm. 
  WT/TPR/M/154 
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I. INTRODUCTORY REMARKS BY THE CHAIRPERSON 
1. The third Trade Policy Review of Bolivia was held on 1 and 3 November 2005.  The 
Chairperson H.E. Mr. Don Stephenson  welcomed the head of the Bolivian delegation 
H.E. Ambassador [Jorge] Asín Capriles, Vice-Minist er for Economic Relations and Foreign Trade, as 
well as Ambassador [Álvaro] Moscoso Blanco and the rest of the Bolivian delegation.  
H.E. Mr. Hugueney Filho (Brazil) had kindly agreed  to act as the discussant for this Review.  As 
usual, the discussant would speak in his personal capacity and not as a representative of his Government.  In accordance with the established pro cedures, he had made available, in advance, 
outlines of the main issues he intended to raise (WT/TPR/D/130). 
2. The Chairperson recalled the purpose of the Trade Policy Reviews and the main elements of the 
procedures of the meeting.  The Report by Boliv ia was contained in doc ument WT/TPR/G/154 and 
that of the WTO Secretariat in document WT/TPR/S/154. 
3. Copies of advance written questions submitte d by Colombia, Switzerland, Chile, Canada, 
the European Union, Japan, Argentina, the Unite d States, Brazil, Mexico, and Korea had been 
transmitted to the delegation of Bolivia.  These questi ons and the replies provided by the delegation of 
Bolivia are reproduced in do cuments WT/TPR/M/154/Add.1. 
4. The Chairperson noted that, since its last Re view in 1999, Bolivia had taken measures to 
modernize and simplify its trade regime, and reduced average applied tariffs.  He was also pleased to 
read in both the Secretariat and the Government's reports that growth had been picking up in recent 
years.  However, the Government report noted th at the debate on the Hydrocarbons Law enacted in 
2005 had led to uncertainty in both this sector a nd other activities.  This was of concern because 
Bolivia's investment indicators had already experien ced a significant drop in earlier years.  In this 
context, the Chairperson was interested in heari ng the Bolivian delegation's view on the Secretariat's 
suggestion that Bolivia could make headway in attracting investment by enhancing its multilateral 
commitments and, thus, the predicta bility of its investment regime.  
5. Both reports had also noted the key role of exports in Bolivia's recent economic growth.  
Although Bolivian export products and markets remain ed somewhat limited in scope, the Government 
report referred to the high growth potential of some  still under-exploited products.  This report also 
said that the limited diversity of the country's production required that Bolivia had tariff-free access 
to foreign markets.  The Chairperson said that Members would appreciate hearing about the extent 
to which export growth had been linked to ma rket access granted to Bolivian products under 
preferential arrangements, both negotia ted and unilateral.  In particular, the importance of the Andean 
Community, and how Bolivia saw the Andean cu stoms union and common market evolving in the 
future.  
6.  The Chairperson planned to propose the adoption of the Report of the Trade Policy Review 
Body for 2005 at the end of the session.  The Draft Report, WT/TPR/W/35, had been circulated to the 
Members for comment on 12 October 2005.  No comments had been received.  WT/TPR/M/154 
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II. OPENING STATEMENT BY THE RE PRESENTATIVE OF BOLIVIA 
7.  The representative of Bolivia apologized for hi s delayed arrival in Ge neva and thanked the 
Secretariat for its willingness to postpone the opening  of the meeting by one day, and the Members 
for their understanding.  His delegation expressed particular gratitude to Ambassador Hugueney, 
discussant for this third Trade Policy Review of Bolivia, as well as the Trade Policy Review Division 
for its work in preparing the Secretariat report. 
8. The representative said that as a contribution to th e exercise in transparency to which all WTO 
Members had committed themselves, his delegation would present Bolivia's efforts to adopt and 
implement measures aimed at simplifying and ensuring the continuity of its trade regime on the basis 
of an open market, free from non-tariff barriers.  He intended to address:  the economic and 
institutional environment, the trade environment, and our activities in the World Trade Organization. 
Economic and institutional environment 
9. During the six years from 1999 to 2004, Bolivia's trade policy had not undergone any 
substantial changes.  The leading macroeconomic indicators revealed that although the country had 
stuck to the model it had chosen, the expected econom ic growth had not taken place.  This reflected 
Bolivia's limited participation in world trade owi ng, particularly over the last few years, to both 
internal and external factors. 
10. The political and social debate in Bolivia on en ergy policy, which had led to the new Law on 
Hydrocarbons adopted in June 2005, had created an element of uncertainty, while the external 
environment governed by international prices that  favoured domestic productio n had enabled exports 
to grow to a record US$2,146,000,000 in 2004.  This  economic recovery had taken place in spite of 
the slowdown in the financial sector, with liquidities (i.e. cash assets and temporary investment) 
increasing in comparison to 2003, so that in case of any run on deposits, the system had US$35.3 
available for every US$100 deposited. 
11. In 2003, the non-financial public sector fiscal deficit had stood at 8.12% of GDP, pension 
spending accounting for the bulk of it.  In 2004, the de ficit had fallen to 6.1% of GDP, largely thanks 
to the extraction and refining of hydrocarbons, enabli ng the economy to grow moderately at 3.6%.  In 
2005, the fiscal deficit was expected to amount to 3.5% of GDP. 
12. This situation had been determined, inter alia , by a high dependency on external financing.  In 
2004, the country's multilateral external debt had re presented 86.5% of the total, while its bilateral 
debt had represented 7% and its debt with the In ternational Monetary Fu nd 6.5%.  These external 
resources played a key role in public investment and in reducing the fiscal deficit. 
13. Improvement to its institutional structures had enabled Bolivia to implement its economic and 
trade policies effectively and efficiently, in  accordance with the competitive dynamics of the 
international economy.  The customs reform had he lped to reduce costs and to streamline export and 
import operations. 
14. At the same time, a Foreign Trade Networ k and a Productive Development and Export 
Promotion Network had been set up to support the development of pr oduction and competition 
through effective facilitation, simplification of formalities, and trade promotion. 
15. To improve the system of registration, establishment, and operation of companies in Bolivia, 
the Business Superintendency had been set up in No vember 2002.  Its purpose was to regulate persons 
and enterprises in areas such as the defence of comp etition, corporate governance, trade registration, 
and restructuring, and voluntary liquidation of enterprises.  It supplemented the competition 
regulations in those sectors with  specific regulatory frameworks.  WT/TPR/M/154 
 Page 5 
 
 
Trade environment 
16. Bolivia's trade policy continued to be based on a free market model adopted two decades ago.  
There were no subsidies that favoured specific se ctors, nor were there any permit or licensing 
requirements that were not acceptable under WTO rules;   and in accordance with the principle of tax 
neutrality, no export taxes were applied. 
17. In the external sector, during the 1990s and the beginning of this century, goods exports 
in general had not exceeded US$1,600,000,000.  However, they  had reached a record of 
US$2,146,000,000 in 2004, reflec ting a quantitative rather than a qualitative leap:  the exportable 
supply had not been substantially diversified, and Bolivia was basi cally responding to foreign demand 
for raw materials. 
18. Bolivia's exports were confined to a handful of  products, and it had few markets.  In 2004, 70% 
of the total value of its exports had consisted of na tural gas, crude oil, products related to oleaginous 
products (soya), zinc, silver, and tin.  In terms of  potential, natural gas and its derivatives were among 
the mainstays of economic growth. 
19. Some 68% of the total value of Bolivian expor ts went to five countries:  Brazil, the 
United States, Venezuela, Peru, and Argentina.  On the other hand, Bolivia's share in Latin American 
goods exports had been less than 0.4% in 20 03, and its share in world exports 0.02%. 
20. This dependency was aggravated by the costs asso ciated with Bolivia's status as a land-locked 
country, making it more difficult to compete effectively and to integrate properly into international trade.  This, in its turn, was aggravated by th e administrative and operative rules imposed by its 
neighbours. 
21. Goods imports had increased by 14% during 199 9-04 compared with the previous six-year 
period.  In 2004, raw materials and intermediate  goods had accounted for 52.2% of the total while 
capital goods had accounted for 25.8%, consumer goods for 21%, and miscellaneous for 0.9%. 
22. During the six-year review period, services exports had risen from US$259,000,000 in 1999 to 
US$400,000,000 in 2004, and imports had maintained  an upward trend, rising by some 67%.   
23. Bolivia's location had enabled it to conduct an active policy at the international level through 
participation in various integration schemes.  It  was a founder member of the Andean Community 
(CAN) and the Latin American Integration Association (LAIA).  In the framework of the LAIA, it had concluded Economic Complementarity Agreem ents (ECA) with Chile, Mexico, MERCOSUR, 
and Cuba.  
24. Under the principle of shared responsibility in  combating illicit drug-trafficking, Bolivia was 
also a beneficiary of the United States' Andean Trade Promotion and Drug Eradication Act (ATPDA) 
and the European Union's GSP+.  Similarly, together  with the other developing countries, it benefited 
from the GSP schemes offered by Ca nada, Japan, Australia, and other developed countries.  Bolivia 
also participated in the Initiative for Regional In frastructure in South America (IIRSA), the River 
Plate Basin Treaty, and the Amazon Cooperation Treaty. 
Bolivia and the WTO 
25. Fully convinced that trade liberalization stimulated, inter alia , the expansion and diversification 
of production and contributed to national development and poverty re duction, Bolivia had joined the 
WTO as an original Member and particip ated actively in the WTO's activities. WT/TPR/M/154 
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26. The ongoing Doha Development Round  negotiations were of cons iderable importance and had 
generated expectations in Bolivia.  The economic and social players hoped that the commitments and 
new disciplines would reflect the needs and priorities of the developing countries. 
27. Aware that the agricultural negotiations were the driving force of the Round, Bolivia had 
participated from the outset in the G-20 in a c onstructive spirit, submitting proposals with other 
developing countries that include both offensive and defensive interests. 
28. Bolivia's main interests in agriculture were s upported by its participation in the CAIRNS Group 
and in the Informal Group on Tropical Products. 
29. While not rejecting the flexibilities establishe d in the Agreement on Agriculture, Bolivia 
continued to refrain from granting subsidies or domestic support to producers in the sector. 
30. An essential component of this Round was the lib eralization of non-agricultural goods with a 
view to achieving substantial market access improve ments and securing commitments that would take 
full account of the special needs and interests of the developing countries. 
31. Bolivia was committed to the progressive libera lization process in trade in services:  it had 
submitted its conditional initial offer,  and more recently, its revised offer, in compliance with the 
ministerial mandates relating to the request-offer approach. 
32. In this growing sector, the movement of physical persons supply mode was of particular 
interest in enabling Bolivian nationals to offe r their services in developed country markets. 
33. The recent trade facilitation negotiations were fundamental for a land-locked country like 
Bolivia, which was seeking new disciplines that provided for improved a rrangements, ensured 
effective freedom of transit, reduced the costs of trade operations, and contributed to the transparency 
of procedures. 
34. At the same, as a country rich in biodivers ity, folklore, and traditional knowledge, Bolivia, 
together with other developing countries, attached particular importance to the urgent adaptation of 
the WTO's intellectual property legislation to  the objectives laid down in the Convention on 
Biological Diversity. 
35. Since this was the "development round", developi ng countries like Bolivia would be insisting, 
in every sphere of negotiations that the WTO view ed special and differential treatment not only as a 
recognized principle, but as an operational instrument. 
36. Similarly, the development issues included in th e Doha Ministerial Mandate and reaffirmed in 
the "July Package" must remain on the agenda of the discussions and be given special attention, as 
this would determine the final balance of the nego tiations – for example the development of solutions 
aimed at further integrating th e small and vulnerable economies in the multilateral trading system. 
37. Finally, having made considerable efforts to ad apt to world trade rules, Bolivia, with its free 
market economy devoid of international-trade-restric ting measures, trusted that its trading partners 
would appreciate what had been done, and urged th e developed countries to make commitments that 
would lead to a substantial improvement in market  access in order to enhance the economic and social 
welfare of their economies.  WT/TPR/M/154 
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III. STATEMENT BY THE DISCUSSANT 
38. The discussant  (H.E. Ambassador Hugueney Filho) pointed out the importance of the TPR 
exercise in terms of transparency, and getting to  know the policies pursued by the Members of the 
WTO.  Bolivia participated very actively in the Doha Round negotiations a nd was a friendly country, 
with which Brazil had a traditi on of very strong relations.  
39. Members had had a very comprehensive and interesting introduction by the Bolivian 
delegation, and a very comprehensive report ha d been prepared by the Bolivian Government, 
containing its views on efforts needed to ensu re the necessary domestic conditions for economic 
growth and an indication of the challenges still ah ead.  The Secretariat Report, was as always, very 
precise and exact in its analysis of trade measures in a wider macroeconomic context and that of 
Bolivian trade negotiations.   
40. The discussant organized his comments ar ound three main issues: macroeconomic 
environment;  trade policy regime and sectoral policies.   
Macroeconomic environment 
41. The discussant pointed out, that during the period 1999-04, Bolivia had faced a complex 
political and social situation, bu t had continuously made efforts for macroeconomic stabilization and 
reached positive results in some areas.  However, this had not been reflected in the growth rate, nor in 
an effective improvement of the living conditions of its population.  Bolivia had low economic growth 
and its GDP per capita had fallen from US $1,005 to US$950 during the period.   
42. At the same time, there had been an improveme nt in the trade balance and the balance of 
payments, with the national budget showing a pos itive tendency as from 2003.  The improvement had 
been fostered by exports, especially of natural gas,  and soya products.  Inflation had remained low, 
between 2.2% and 4.4% and the trade deficit, wh ich was linked to the pension reform, had been 
reduced from 7.9% to 5.5% of the GDP, in 2003-2004.   
43. Bolivia had continued to reduce its trade defic it, meaning that it had been making enormous 
efforts to adapt in difficult situations.  Despite the difficulties, exacerbated by its landlocked situation 
and the smallness of its economy, Bolivia rema ined committed to an open economic model and 
continued with its macroeconomic stabilization policies and structural reforms.  Its economy had few 
trade barriers, which reflected a tremendous effort by the Government to incorporate the principles 
and disciplines of the WTO Agreements.  
44. Nevertheless, during the period under review, the efficiency of Bolivia's economic policies was 
put into difficulty by a complex situation marked  by external shocks a nd tremendous problems of 
social instability.  Thus, there had been institutio nal vulnerability, energy had been squandered and 
there had been two premature changes of the highest  authority of the country, in the context of 
increasing unemployment and extended informal activities.   
45. Bolivia considered its regional contacts as very important for its  economic development 
strategy.  As there was high concentration of its exports to a few South American countries, it seemed 
reasonable to participate widely in regional in tegration processes, such as ALADI, MERCOSUR, the 
Andean Community, the South American Community of Nations.  Furthermore, such initiatives could 
be supported by regional energy networks, and the progressive construction of a common 
infrastructure, in the framework of  the initiative for the Integration of Regional Infrastructure in South 
America.  In this context, the discussant underlined  the links between Brazil and Bolivia.  Brazil and 
MERCOSUR had consolidated their positions in recent  years as Bolivia's main economic partners.  In 
2003 Brazil alone absorbed 30% of Bolivian exports , concentrated in crude oil and natural gas.  WT/TPR/M/154 
Page 8  
 
46. At the multilateral level, the discussant belie ved that the Doha Round could also offer 
additional development opportunities for Bolivia, which had chosen as its main areas of interest in the 
negotiations special and differential treatment fo r landlocked developed c ountries, negotiations on 
tropical products, and, as a Member of the G-20, the liberalization of agricultural trade.  The 
discussant stressed that Bolivia was one of the count ries that had presented initial and revised offers 
for services negotiations, reflecting significant e fforts and commitment to the objectives and the 
success of the Doha Round.   
Trade policy regime 
47. In spite of the difficulties experienced, Bolivia had pursued an open trade regime policy and 
had adopted measures to modernize its trade regime and facilitate trade.  In that spirit, it had 
undertaken customs reform to facilitate and impr ove external trade, had adopted a new general 
custom's law and regulations and the WTO definiti on of transaction value, and had eliminated the 
preshipment inspection.  Important efforts were also  being made to expand the external trade network, 
and the growth and export promotion networks. 
48. All tariffs had been consolid ated and were expressed in ad valorem terms.  The average applied 
tariff had decreased from 9.7% in 1999 to 8.2% in 2005, which was very low for a developing 
country.  Bolivia did not use the price-band syst em of the Andean Community for agricultural 
products.  It did not apply export duties, but ha d fiscal incentives for exports under some specific 
frameworks, such as free zones, the Temporary Admission Regime for Inward Processing (RITEX), 
and the tax refund.  Bolivia did not apply anti- dumping, safeguard or countervailing measures.  
Sectoral policies 
49. Despite agriculture's relatively modest cont ribution to GDP, the sector employed 42% of 
the economically active population and represented 28%  of total exports.  A lthough its productivity 
had been affected by social conflicts and lim ited access to credit, some exports had increased 
considerably, benefiting from preferential access,  especially to the Andean Community and 
MERCOSUR. 
50. The programmes implemented since 1986 for coca eradication had had a negative effect on 
agricultural income.  The Bolivian Government had made tremendous efforts to replace coca leaves, a 
traditional product in Bolivia, by alternative cr ops, although it had not always had the necessary 
support, including the opening of main markets for replacement products.   
51. While the economic importance of mining had fallen over recent years, it remained important 
in terms of exports, in particular zinc and tin , which had benefited from a recent improvement in 
international prices, as well as silver and gold.   
52. The manufacturing sector, concentrated in food and beverages industries, and in the fabrication 
of oil refinery products and natural gas, cont ributed almost 70% to manufacturing GDP.  Some 
industries, such as dairy and textile  products, had experienced a significant increase of their exports in 
recent years. 
53. The natural gas industry was the main and most  attractive sector for exports and foreign 
investment.  The discovery of large deposits of  natural gas had positioned Bolivia as the second 
largest reserve in South America, af ter Venezuela.  The contribution of  natural gas to total exports had 
increased significantly between 1999 and 2004, from 2.5 to 23.1%;  much of these exports went to 
Brazil.   
54. The topography and the lack of access to the sea,  as well as the precarious infrastructure, made 
transport and regional integration difficult.  The cost of transport in Bolivia was considered to be the  WT/TPR/M/154 
 Page 9 
 
 
highest in South America.  Nevertheless, its ge ographical location in the heart of South America 
represented a favourable factor for Bolivia as a future  strategic centre for regional transportation.  
55. The Government had also focused its efforts on promoting tourism, which was the fourth 
largest generator of foreign currency;  Boliv ia had tremendous potential as a destination for 
international tourism.  
56. Despite significant challenges throughout the pe riod under review, Bolivia had maintained its 
commitment to the WTO rules.  Members could see that the Bolivian trade policy was open;  a policy 
of integration, not only regionally but also in a wider framework, within the WTO.  It was important, 
for Bolivia and the WTO, that Bolivia benefite d from the flexibilities and the special differential 
treatment, as well as from immediate and effective advantages, and from liberalization of the import 
markets of Members.  
57. The discussant also mentioned the importance and the role of regionalism and multilateralism 
in the Bolivian trade policy;  the economic and po litical impact of the coca eradication programmes, 
and the difficulties faced when adopting alternative cr ops;  and measures that could be adopted by its 
trading partners to promote Bolivia 's economic stabilization and growth. WT/TPR/M/154 
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IV. STATEMENTS BY MEMBERS 
58. Members welcomed the delegation of Bolivia, and thanked H.E. Amba ssador [Jorge] Asín 
Capriles for his introductory remarks and the discu ssant for his contribution.  A number of Members 
referred to the questions they had submitted to the Bolivian delegation in writing and looked forward 
to receiving the replies. 
59. The representative of Colombia
 underlined her country's historical links with Bolivia.  More 
recently,  Bolivia and Colombia had participated together in all economic integration processes, such as the Latin American Integration Association, A ndean Community, and more recently the Free Trade 
Area of Americas and, as observer and future signa tory, in the free-trade agreement between Andean 
countries and the United States.  Colombia stressed the fluidity of trade relations between the two 
countries, which had been regulated by commitme nts undertaken in the fra mework of the Andean 
Community. There had been no trade barriers, and b ilateral trade had been growing constantly.  The 
trade balance had been negative for Colombia and,  in that sense, it had contributed to Bolivia's 
economic development.    
60. Colombia took note of Bolivia's efforts to im prove its institutions and legislation regulating 
foreign trade.  Its Report also informed Member s of the political, economic, and social costs of 
implementing various WTO commitments.  These cost s were not specific to Bolivia, but to all 
developing countries.   
61. The Report by Bolivia also mentioned stru ctural reforms recommended by international 
institutions that involved opening up the capital acc ount and trade.  Even if there was a correlation 
between the height of investment in 1999 and the st ructural reforms, it should not be overlooked that 
per capita GDP in Bolivia was below US$1,000 and had been diminishing since 1999.  This meant 
that structural reforms had not been sufficient to  increase the quality of life.  Economic reforms were 
not sufficient to generate growth;  a lot of social investment was required.  It was necessary to invest 
in human capital.  
62. On the other hand, the Secretariat Report had indi cated that the social and political instability 
and external shocks, explained why economic policies had not improved conditions for the 
population.  Colombia stated that no economy was exempt from temporary external shocks.  
Therefore, it did not believe that ex ternal shocks or social and politi cal instability were responsible for 
the low per capita income in Bolivia .  If there was a social and poli tical instability, it was because the 
policies applied did not resolve population's needs.  
63. Economists confirmed that geography was impor tant for economic growth, but many other 
factors were involved, and an economy was not co ndemned for ever by its geographical limitations.  
Various economies had successfully overcome natu ral difficulties:  Switzerland had no access to the 
sea, and Chile was very far from international market s.  The lesson was that comparative advantages 
could be built. 
64. The Bolivian authorities had not been insensitive to the social and political discontent and had 
been relying on democracy to channel this discont ent.  Economic incentives were being provided by 
authorities with structural reforms and trade libera lization, and political incentives were being taken 
care of through referendums in Bolivia.  
65. The representative of Switzerland
 highlighted that Bolivia had been a priority country for Swiss 
development cooperation since 1969.  Bolivia was Switzerland’s most important destination for 
bilateral aid in Latin America, accounting for Sw F 25 million in 2005. The Swiss Development 
Cooperation had showed an increasing involvement in  the areas of trade and investment promotion, 
and had assumed a leading role in improving the sti ll modest bilateral trade relations and facilitating  WT/TPR/M/154 
 Page 11 
 
 
major Swiss foreign direct investment in Bolivia.  Bilateral investment was further promoted and 
protected by a bilateral agreement in force since 1991. 
66. Switzerland attached great importance to the fu rther consolidation of Bolivia’s favourable 
institutional framework for trade and investme nt. Macroeconomic stability due to commendable 
action by the interim government on one the hand, a nd setbacks in the implementation of structural 
reforms due to the political crisis on the other hand, had yielded a mixed picture in terms of the recent 
developments.  Switzerland noted positively that, on the basis of favourable external conditions, 
growth continued to be strong.  However, politi cal uncertainties and potentially harmful policies in 
the hydrocarbon sector had led to worsening prospects for the investment climate and growth.  In the 
context of political and social tensions, Swit zerland encouraged the Bolivian Government to 
strengthen efforts to control fiscal deficits, promote competition in local services, and sustain the legal 
protection of foreign direct investment. With re gard to the development of exports, the Swiss 
Government supported the process of the elaborati on of the National Export Strategy (ENEX).  The 
improvement in the trade balance was not due exclus ively to higher gas exports, indicating that export 
diversification could be maintained to a certain ex tent. These developments could lead to an increase 
of the foreign direct investment flows into Bolivia, a strengthened role of exports in the promotion of 
economic growth and the creation of employment and reduction of poverty. However, Switzerland 
urged the authorities to take note of the alarming shrinkage of investments expected in the hydrocarbon sector.  
67. Bolivia had become an active member in ma ny areas in the WTO Development Round and had 
contributed to the variety of opinions and views e xpressed, especially by developing countries.  This 
had enriched discussions and would help to find a balanced outcome.  Since its last review, Bolivia 
had deepened its trade liberalization commitment.  By streamlining local customs procedures and maintaining a nearly uniform tariff regime at a lo w average rate of 8.2% (down from 9.7% in 1999), 
Bolivia remained a model for pred ictable, transparent trade policy in Latin America.  Bolivia had 
made considerable efforts to expand its particip ation in FTAs and for preferential market access.  
Switzerland hoped that Bolivia would seize the oppor tunity of the current AFTA negotiations, to 
become a full partner to a future arrangement.  Bolivia had the opportunity to consolidate salient 
market access preferences for local manufactures, a nd thus, highlight regional trade agreements as a 
strategic complementary tool to multilateral liberalization. 
68. Adequate and effective protection of intellect ual property rights were a prerequisite for a 
market to attract investment and to encourage research and development activities.  Switzerland 
welcomed Bolivia’s efforts since 2001 to improve  the enforcement of its intellectual property 
legislation.  It also strongly encouraged Bolivia to  complete the general code of intellectual property 
rights, initiated in 2001, in order to improve the le vel of protection of the areas covered by the TRIPS 
Agreement. 
69. The representative of Chile
 underlined the multilateral, regi onal and bilateral links between 
Chile and Bolivia.  In the context of Doha negotia tions, both countries had been working for balanced 
results in all areas of negotiation, and especially in the areas of interest for developing countries, such 
as agriculture, where both countries were members of  the Cairns Group and G20, and shared common 
objectives.    
70. Despite a complex political, social, and institutiona l situation, Bolivia continued to apply an 
open market model.  Since its accession to the WTO,  Bolivia had achieved important results in trade 
liberalization:  it had consolidated all tariffs, a nd reached an average applied tariff of 8.2%.  In 
addition, it had undertaken important efforts to m odernize and simplify its trade regime by, among 
other things, adopting the WTO transaction value, eliminating preshipment inspection, and adopting a 
new Customs Law.  Bolivia did not apply export taxes, had no subsidies, and its services sector 
accounted for 54% of GDP.  Its offer should be  beneficial for foreign direct investment. WT/TPR/M/154 
Page 12  
 
71. Chile stressed the will of both countries to deep en their trade relations which had materialized 
in an Agreement that completed the opening up of Chilean market to all Bolivian products in an 
asymmetric way.  Chile hoped that it would thus beco me one of Bolivia's five main trading partners.  
72. Bolivia was an active and trusted member of th e multilateral trading system, with which Chile 
shared expectations, especially regard ing the results of the Doha Round.  
73. The representative of Canada
 stressed the healthy bilatera l commercial relationship between 
Canada and Bolivia.   Bolivia was one of the 25  countries identified by Canada as a development 
partner.  As such, Canada had an important de velopment assistance programme with Bolivia through 
the Canadian International Development Agency (C IDA).  Official development assistance to Bolivia 
in 2004 was approximately Can$16 million. 
74. Bolivia had taken measures to modernize and simplify its trade regime since its last Review.  
Canada followed with interest Bolivia’s progress in this regard and its national programme of trade 
and investment policies, initiated in May 2005.  Wh ile Bolivia had made steady improvements to its 
GATS commitments, including regardin g its initial services offer, the lack of commitments in specific 
areas, such as professional services, continued to be a concern.  Canada encouraged Bolivia to bind its 
regulatory status quo, which allowed for the particip ation of foreign professionals, subject to certain 
limitations. 
75. Canada appreciated Bolivia’s st rong commitment to the principles of free and open markets in 
trade.  In agriculture, where regulations were re quired to protect human, animal and plant health, 
Canada recognized Bolivia's support for regulations  based on science and on international guidelines. 
As such, Canada would welcome Bolivia's coope ration and assistance to quickly re-establish access 
for Canadian live cattle and beef products, and poultry and poultry products, in accordance with the 
guidelines of the World Organization for Animal Health. 
76. Canada had fully supported the G7 proposal to write off the debt owed to the World Bank and 
the IMF by several developing countries, including Bo livia.  Canada hoped that this would better help 
Bolivia to handle its macroeconomic challenges.  
77. Canada understood the socio-economic and po litical pressures that poverty and high 
unemployment could place on a country like Bolivia .  However, when a government was committed 
to maintaining a liberal and transparent trade re gime, the country as a whole would be better placed, 
in the long term, to fully enjoy the benefits of increased trade and global economic growth. Canada 
encouraged Bolivia to continue its efforts towa rds political stability and improving the conditions for 
economic growth, which would benefit all segments of Bolivian society.  
78. Canada was interested to know whether Boliv ia was planning on making use of the August 
2003 Decision on Access to Medicines.  
79. The representative of European Communities  stated that the relations between the EC and 
Bolivia went back many years and included political , economic, and social priorities.  The EC was 
aware of Bolivia's efforts to improve its administ rative and legal framework, laying the basis for a 
stronger economy;  it was also making considerable e fforts to liberalize trade, by lowering tariffs and 
creating the national committee for the simplification of transport and international trade, with the 
objective of simplifying formalities a nd procedures, as well as introducing a system of prior customs 
clearance and an automated customs system.   
80. Bolivia was also continuing to privatize state-en terprises, thus developing the private sector.  
These efforts provided an adequate basis to c ontinue with the reform and boost Bolivia's 
development.  They also provided a basis for add itional efforts to create an effective and efficient 
market and promote growth and development.  The EC  encouraged Bolivia to continue its efforts to  WT/TPR/M/154 
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introduce a competition policy and to reform the privat e sector, as well as the transport, financial, and 
communication sectors, all essential for development.  These reforms could be complemented by a framework to increase direct investment and open up the market to foreign service suppliers.  As 
Bolivia was very dependent on natural resources, especially agriculture, mining, and hydrocarbons, 
these reforms would directly assist the economic development of Bolivia and indirectly export 
diversification.   
81. Customs reforms that were under way also cr eated the appropriate basis for modernizing 
Bolivia's custom's regime.  Even  though Bolivia had reduced its tariffs, bound duties continued to be 
very far from the applied duties.  This gave ri se to considerable uncertainty for importers and 
exporters. On the other hand, alt hough Bolivia had introduced lower ta riffs, custom's procedures were 
very cumbersome and could give rise to practises th at were not transparent and did not promote the 
Government’s objectives.   
82. The EC shared Bolivia's view on regional integra tion.  It could stimulate the consolidation of 
regional trade and promote economic development.  Bolivia had played a fundamental role in the 
Andean regime initiative to open up markets and pr omote regional trade.  The depth of regional 
economic integration was fundamental for a mutua lly beneficial free-trade agreement that would 
contribute to economic development and contemplate substantially all sectors a nd products.  For this, 
the EC was following with great interest the process of liberalization of services planned for 2005.   
83. The representative stated that regional and bila teral agreements could not replace multilateral 
agreements.  Countries, such as Bo livia, needed strong capacities to integrate in the world trading 
system, and the EC planned to continue working wi th Bolivia, also through technical assistance, to 
improve infrastructure, customs services, and export diversification.  However, this assistance would 
achieve its objectives only if the foundations were strengthened. 
84. The representative of Japan
 stated that his country appreciated Bolivia's active participation in 
the WTO.  Bolivia had submitted a large number of notifications and a number of proposals in the 
current negotiations.  In particular, Japan appreci ated Bolivia's constructive participation in the 
negotiations on trade facilitation, as witnessed by th e submission concerning the freedom of transit 
(together with two other landlocked countries, Mon golia and Paraguay), for which Japan had become 
a co-sponsor.  Bolivia had also been active in ser vices, as shown by its commitment to the Fourth 
Protocol to the GATS and an early submi ssion of offers in the services negotiations. 
85. Japan hoped that Bolivia would continue to par ticipate actively in the WTO and make further 
improvements, for example, by acceding to the WT O plurilateral agreements.  Japan hoped that all 
WTO Members, including Bolivia, would contribu te to the success of the Hong Kong Ministerial 
meeting and the final success of the DDA. 
86. Since 1999, GDP growth in Bolivia had decreased compared with the mid 1990s.  The situation 
had been improving slightly since 2002, as the ri sing price of natural resources had contributed to 
economic growth.  However, in or der to strengthen the basic structure of the economy, Japan believed 
that foreign direct investment was crucial.  In this regard, it feared that the new Hydrocarbon Act, 
which required enterprises to make new contacts with the Bolivian Government, would discourage 
both domestic and foreign investment. 
87. Based on the experiences of Japanese companies opera ting in Bolivia, certain points needed to 
be improved in order to achieve an investment-fri endly environment and to reactivate the economy of 
Bolivia.  Political stability and legal framework we re the basis for the predictability of trade and 
investment.  Trade and investment administration needed  to be transparent, effective, and simple.  For 
example, complicated export procedures and charges were barriers to expor ts.  The procedure to 
reimburse VAT for exports was also too complicated to operate smoothly.  These factors were damaging for the competitiveness of Bolivian exports .  Regarding imports, delays due to customs WT/TPR/M/154 
Page 14  
 
procedures and border inspection represented costs fo r importers.  Relatively important informal trade 
harmed fair competition and incentives to promote industries in Bolivia.  The low price policy for 
hydrocarbons for domestic use due to subsidies a nd fixed prices spurred informal trade and brought 
about a lack of domestic supply of such resources.   Concerning the protection of intellectual property 
rights, there was still a lot of piracy of CDs, DV Ds, computer software, etc., although Bolivia had 
endeavoured to establish legislation for the protecti on of intellectual property rights.  It was essential 
to enhance the enforcement of IPR protection, in order to secure foreign investment in Bolivia. 
88. The representative of Argentina
 said that Argentina and Bolivia not only shared profound 
historical links, but over the last few years the traditional bilateral relati ons had been strengthened 
even further, due to important political decisions that had led to a number of agreements promoting 
the bilateral integration.  The amplitude of relati ons should be seen in the context of the sub-region, 
since Bolivia was an associat e state of the MERCOSUR through Economic Complementarity 
Agreement No. 36, which also contained provisi ons to promote complementarity of productive 
sectors, exchange of trade information, services, phy sical integration, investments, and scientific and 
technological cooperation.  In that context, bilate ral relations had promoted a positive evolution of 
trade with Bolivia and concretization of importa nt cooperation projects in the framework of the 
Argentinean Fund for Horizontal Cooperation.  
89. Since the last Review of Bolivia, growth had b een relatively low, but had improved since 2002.  
Exports, a key element of the growth, had almost doubled, increasing the proportion of trade in GDP 
to 57% in 2004.  In the same year, economic gr owth was 3.6% and its most dynamic component was 
the export sector, in particular hydrocarbons.  Gas exports constituted one of  the vital pillars for 
promoting economic growth.  A number of actions had been taken to draw-up agreements in this area, 
in order to enforce the energy networks within th e region.  In this regard, Argentina highlighted 
Bolivia's ambitious medium-term objectives set out in its economic and social development plan, 
adopted in May 2005, which included developing its  productive capacity and reducing inequalities of 
income distribution.  The plan was also aimed at consolidatin g the existing export markets and 
opening up new ones.  This initiative deserved the support of all WTO Members, in particular the 
most developed ones, and Argentina invited them to open up their markets to Bolivian products.   
90. Bolivia's commitment to the multilateral trade sy stem was based on its conviction that trade 
liberalization was an instrument for strengthening  development, expansion and diversification of 
international trade.  The results of the Doha R ound should help to reduce the imbalances in the 
development levels of Members.  Argentina welcom ed Bolivia's active participation in all negotiating 
fields, in particular agriculture, as a member of the Cairns Group and the G-20, and its contributions 
in the negotiating group on trade facilita tion and other development issues.   
91. The representative of Paraguay  said that his country was very appreciative of the important 
bilateral links it had with Bolivia as a neighbour and a trade partner.  Bolivia had made great efforts 
since its last Review, though these had not always  led to the success that many other countries had 
enjoyed.  Landlocked countries had to make at le ast twice as much sacrifices to achieve the same 
results, pursue policies, maintain the rhythm, and ho pe that the international context would not be 
adverse.   
92. Bolivia had brought its legislation into line with al l WTO rules,  consolidated its tariffs at low 
levels, and applied MFN tariffs with an average of onl y 8.2%.  It had also been very active in regional 
integration and taken important measures to attract foreign investment.  Nevertheless, transport costs 
in Bolivia were the highest in South America.  Th is was one of the many disadvantages it had to deal 
with as a landlocked country.  It also depended on ser vices provided by other countries for its exports.  
The extreme vulnerability of landlocked developing countries was precisely due to those factors.  
Bolivia's situation was exacerbated by its extrem ely mountainous geography and lack of large 
navigable rivers.  Statistics showed  that nine of the 20 poorest countries in the world were landlocked, 
while 16 of the 31 landlocked developing countries were  classified as least developed.  Bolivia was  WT/TPR/M/154 
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not a least developed country, but together with Pa raguay, it was one of the poorest countries in South 
America.   
93. A number of landlocked developing countries had grouped together, to analyse their situation 
and promote measures to back up domestic efforts.   At a meetings in Asunción, in August 2005, 
Ministers of this grouping recognized the importanc e of trade as an engine for growth, development, 
and poverty eradication;  they also denounced th eir persistent marginalization and decreasing 
participation in international trade.  They urged the WTO to adopt specific me asures to facilitate their 
access to markets, to help them to set up necessary infrastructure and offer them adequate transport 
services, in order to mitigate problems due to thei r geographical situation and smallness of their 
economies.  The framework for these measures had al ready been established in paragraph 35 of the 
Doha Ministerial Declaration.  Bo livia had shown its determination to work in this direction, and 
together with Paraguay had submitted a number of proposals and suggestions. 
94. When analysing Bolivia's trade policy, it was ne cessary to take into account its situation and 
appreciate its efforts to maintain an open econo my, friendly and cooperative relations with the 
countries in the region, and its commitment to global peace.   
95. The representative of the United States  noted that Bolivia had clearly been working to improve 
on the structural, economic, and governance initiatives discussed at its previous Review in 1999.  
Positive steps had been taken, such as the implem entation of WTO Agreement on Customs Valuation, 
the elimination of preshipment inspection, the st reamlining of customs procedures, and efforts to 
combat corruption. Applied tariffs  remained low and a new strategy  to expand and diversify exports 
was being prepared. 
96. For the first time in recent years, Bolivia's tr ade account had moved into surplus, reflecting 
strong export growth from many sources, including sal es of natural gas to regional partners such as 
Brazil, and higher prices for minerals on global ma rkets.  Under the Andean Trade Promotion and 
Drug Eradication Act, Bolivia's exports to the Un ited Sates also had increased.  Recent trends with 
imports and investment, however, had been less fa vourable.  Despite low applied tariffs, Bolivian 
imports had decreased, and so had foreign direct in vestment and gross capital formation, particularly 
in non-energy sectors.  A convergence of economic and political factors – internal and external – 
helped to explain these trends. 
97. The Secretariat Report stressed the importance of reviving investment, boosting productivity, 
and promoting sustainable growth.  Recognizing that the recent Hydrocarbons Law may have had 
some negative effects on foreign investment, particul arly in the energy sector, the United States asked 
for an update on the Government's efforts to improve  the investment climate.  They also requested 
information on how Bolivia intended to reduce disparity between bound and applied tariffs.  
Regarding services, the United States enquired about fu rther internal market reform and new market 
access commitments to increase Boliv ia's attractiveness for foreign investment, as well as efforts to 
combat piracy and improve enforcement of intellectual property rights.   
98. The representative of Brazil  stressed that during the period under review, Bolivia had faced a 
very difficult situation, characterized by exte rnal shocks, and social and political instability.  
Nevertheless, the expansion of its exports had helped to ensure economic growth, albeit moderate.  Its 
regional trading partners had consolidated their positions as main export and import markets, in 
particular Brazil, a main export market for Bolivia n crude oil and gas.  Therefore, trade and the 
balance of payments had registered a significant im provement, and the fiscal situation – even though 
fragile – had begun to improve in 2003, with the fisc al deficit down to 5.5% of the GDP.  At the same 
time, inflation had remained under control.   
99. Bolivia had made numerous proposals in the framework of the Doha Round.  It had been also a 
very active participant in regional integration pr ocesses, and was a founding member of the Andean WT/TPR/M/154 
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Community, a member of the Latin American Integration Association, had signed an economic complementarity agreement with MERCOSUR.  Boliv ia was also participating in the process of 
establishing a South American Community of Nations.   
100. Brazil congratulated Bolivia for its efforts to  strengthen its participation in integration 
processes, open up new export markets, promote investment, and consolidate links with the private 
sector through the initiatives such as the Bolivian External Network and th e National Strategy of 
Exports.  Brazil took note with satisfaction of me asures adopted to modernize the trade regime and 
facilitate trade, including the adoption of WTO de finition of transaction value and the new general 
custom's law.  Bolivian tariffs were all bound and ad valorem , increasing the predictability of its trade 
regime.  Furthermore, the average MFN tariff had gone down from 9.7% in 1999 to 8.2% in 2005.  
101. The representative of Mexico
 stated that Mexico and Bolivia shared numerous cultural, 
commercial, and other links that bound them in a common future.  Both economies, and in general, 
both countries were linked through their relative cl oseness, and the various trade liberalization and 
harmonization efforts at the regional level.  But mo re importantly, the trade link had been deepened 
by a free-trade agreement, signed in 1994, that ha d strengthened the bilatera l exchange and provided 
legal guarantees to Mexico's investment and foreign trade operations.  Bilateral trade between Mexico 
and Bolivia had risen from US$8million in 1990 to a little over US$64 million in 2004. 
102. Mexico reiterated the importance of Bolivia's active participation in the ongoing negotiations 
at the WTO, and commended Bolivia for its revised services offer.   
103. The representative of Korea  noted that, in spite of political and socio-economic difficulties, 
Bolivia had maintained the open trade regime it had established through comprehensive trade reforms 
in the late 1980s and 1990s, as well as measures to improve its trade regime since its last Review in 
1999.  Bolivia’s tariff structure was simple, with all tariff lines bound and a lo w average applied rate 
for a developing country of 8.2%.   
104. However, a number of other taxes and import charges significantly increased the total duty on 
imports, which created incentives for smuggling, and undermined the prospects for domestic 
economic development.  Curbing smuggling would help  increase the tax base and contribute to the 
development of small and medium-s ized firms, which currently had to compete with smuggled goods.  
Increased government revenue and the devel opment of domestic industry would enable the 
government and the private firms to expand public and private investment, respectively, helping 
provide impetus for economic development.  In th is regard, reducing the various duties on imports 
could be considered not only in the context of lib eralizing trade but also as a means of boosting the 
domestic economy. 
105. Korea welcomed Bolivia's efforts since its l ast Review on the use of transaction values in 
customs valuation, the elimination of preshipment  inspection, and other tr ade facilitation measures 
through the implementation of the General Cust oms Law and the establishment of the National 
Committee for the Facilitation of Transport and Inte rnational Trade.  Moreover, being a land-locked 
economy, Bolivia was participating actively in th e DDA trade facilitation negotiations.  Continuing 
efforts in customs reform and trade facilitati on, such as improving risk assessment mechanisms, 
reducing heavy and sometimes redunda nt paperwork, and strengtheni ng coordination among relevant 
agencies, would help bring transaction costs down and combat smuggling. 
106. Given that Bolivia had a relatively small dom estic market and was a land-locked economy, 
regional integration consistent w ith relevant WTO disciplines could serve various purposes, such as 
expanding its market and upgrading trade regime.  The Andean Community members were engaged 
in FTA negotiations with other countries in th e region and Bolivia was participating in these 
negotiations either as a negotiating country or as an observer.    WT/TPR/M/154 
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107. The representative of Cuba  stated that Cuba and Bolivia, like other countries in the region, 
shared historical and cultural ties.  Cuba also  faced similar problems as Bolivia, and it was not a 
coincidence that Cuba and Bolivia shared common in terests in the WTO.  The strengthening of the 
multilateral trading system, a reduction in asymmetr ies between developed a nd developing countries, 
and effective solutions to the difficulties of small economies to compete in international trade, were 
some examples of the goals both countries would like to see finalized in the current negotiations. 
108. Bolivia's situation reflected the hard reality facing small developing countries.  It was an 
underdeveloped small economy whose revenues depe nded on the export of a few products to a few 
markets;  these factors were made worse by having no access to the sea, which increased costs and 
reduced possibilities in the presence of competitors.  In spite of this, Bolivia had fulfilled its WTO 
commitments, which was evidence of the importance of trade for its economy. 
109. Cuba and Bolivia had an excellent bilateral relationship, which included searching for new 
ways to increase bilateral trade and advance the implementation of the Economic Complementarity Agreement.  There was a very large number of Bolivian students in Cuba. 
110. Cuba commended Bolivia for its active role in the WTO deliberations and emphasized that it 
understood Bolivia's concerns.  Cuba was honoured to share an approach to development that 
corrected disequilibria and protected the fragility of  the smaller and more vulnerable economies.   
111. The representative of Peru
 Bolivia its efforts to liberalize trade, to which all Members were 
committed. 
112. Peru shared many historical, social, and economi c links with Bolivia and a very close bilateral 
relationship.  Peru and Bolivia had bilateral agreements in several fields, including trade and 
investment promotion, and shared membership in the Andean Community, the South-American 
Community of Nations, the Amazon Cooperation Treaty,  the Latin-American Integration Association, 
amongst others.  The Economic and Social Integr ation and Cooperation Treaty, signed by both 
countries in 2004 with a view to forming a common  market, was of special importance as was the 
Energy Complementary Agreement also signed in 2004. 
113. There was a sustained high level of trade be tween the two countries that had been increasing 
year after year with a very even overall balance.   There was also optimal intraregional investment, 
which had multiplied in the past few years.  There was over US$80 million of Peruvian capital in Bolivia, and several firms established in its territory  enjoyed the economic and financial stability that 
Bolivia had maintained in spite of some recent political problems.   
114. Peru welcomed the boost in Bolivian exports in  2004, and hoped that it would continue;  Peru 
had had a similar experience, helped by the increas e in prices of mining products and commodities.  
However, the challenge lay in turning this export bo om into an increase in productivity throughout all 
sectors and an improvement in the distribution of income. 
115. Like Bolivia, Peru also faced the challenge of diversifying away from crops from which 
illegal drugs could be obtained.  In this sense, Pe ru thanked Bolivia for keeping its strategy of 
alternative development, a clear sign of its respect for the principle of shared responsibility.  Bolivia, 
along with other Members, was seeking maximum li beralization for tropical and alternative products, 
as part of special and differential treatment, of o ffensive interest, in agricultural negotiations.  This 
was a sign of Bolivia's compromise with the ob jectives of the multilateral trading system and 
the WTO. 
116. Referring to the Secretariat report, the representa tive said that Peru shared the concerns and 
interests pointed out in paragraph 42 of Chapter IV, regarding the importance of service negotiations, 
particularly with respect to mode-4 supply.  With  respect to financial services, Peru could vouch for WT/TPR/M/154 
Page 18  
 
the guarantees one of the most important banks in terms of Peruvian capital had received when it invested in that sector.  Several Peruvian firms ha d invested in Bolivia either through subsidiaries or 
supply of services in other sectors, without any trouble in installation or operation. 
117. With respect to paragraph 43, Peru noted that  Bolivia, along with Peru, Brazil, and the other 
Andean countries, was also interested in findin g a solution to the problem of adapting the patent 
system of the TRIPS Agreement to the Convention on Biodiversity and the Cartagena Protocol on 
Biodiversity.   
118. Peru acknowledged the difficulties Bolivia faced, as a land-locked country, and its proactive 
role in the trade facilitation negotiations.  Peru hoped that this would translate into the support 
necessary to arrive at transparent facilitation standard s at the end of the negotiations and help Bolivia 
improve its custom system, particularly with respect to dispatch and custom control, including at the 
border. 
119. Chile and the EU had already mentioned their concern about Bolivia's regime of competition 
policies, which were rather diverse, non-homogene ous, and varied according to sector.  Peru asked 
whether there were legislative initiatives to make competition regulations uniform or to create new 
authorities in competition matters. 
120. The representative of El Salvador
 commended the Government of Bolivia for the 
considerable advances since 1999.  These were the r esults of Bolivian tenacity;  Bolivia had made 
enormous efforts in modernizing the State, and lib eralizing trade and investment.  Economic policy in 
Bolivia continued to be determined through a free market model, and El Salvador encouraged the 
Bolivian Government to continue with this objective. 
121. Bolivia's trade regime was predictable and transp arent, particularly with initiatives such as 
new SPS measures and regulations in the services s ector.  El Salvador commended Bolivia for its 
neutral and non-discriminatory structure amongst sector s, its policy of non-intervention in agriculture, 
the ongoing modernization of the customs administra tion, and the recent related legislation, which 
met the objectives of efficiency, transparency, and simplification.  At the same time, it commended 
Bolivia for its recently sanctioned Hydrocarbons Law, demonstrating Bolivia's ability to expand 
exports, and therefore its economy, particularly in 2004. 
122. El Salvador also commended Bolivia for its  recently approved medium-term economic and 
social development plan aimed at developing its productive capacity and reducing the income 
distribution inequality, with a view to achieving  equitable development.  Bolivia's hard work 
concerning competition policy and intellectual property rights was acknowledged, as well as the 
establishment, organization, and functioning of SENAPI, a modern intellectual property office, in line 
with international quality control parameters.   
123. El Salvador highlighted Bolivia's policy in resp ect of regional integration, which had focused 
on the negotiation and signing of regional trade agr eements, particularly with the Andean Community, 
MERCOSUR, Chile, Cuba, and Mexico.  El Salva dor, being a developing co untry, acknowledged the 
difficulties that Bolivia had faced  to meet its multilateral commitments.  El Salvador commended 
Bolivia for its dynamism and professionalism in advancing the small economies' issues, without 
losing sight of the common objective of integrating their economies to world trade.   
124. The representative of Uruguay  acknowledged Bolivia's active participation at the WTO, its 
firm compromise with the multilateral trading system, as well as its role as a promoter of trade liberalization as a key to growth and developm ent for a small vulnerable economy.  He also 
mentioned Bolivia's role in the regional integration process, including, the Economic 
Complementarity Agreement between Bolivia and MERCOSUR, which was the first trading 
agreement signed by MERCOSUR.  WT/TPR/M/154 
 Page 19 
 
 
125. The Secretariat report had noted that Bolivia's  recent GDP growth had been driven essentially 
by exports and that international trade measured as a proportion of GDP had increased to 57% in 2004 
due to an increase in exports.  This was evidence of the important role of international trade in 
Bolivia's economy, and particularly in agriculture , which contributed immensely to employment and 
exports. 
126. Uruguay acknowledged Bolivia's contribution to the multilateral trading system through its 
active participation in the ongoing negotiations an d particularly in agricultural negotiations where 
Bolivia had always maintained a position similar to th at of Uruguay.  This was that agriculture should 
have been submitted to the same norms as tr ade in other goods, which had the objective of 
establishing an equitable and market-oriented world agricultural trading system.   
127. Given Bolivia's attitude, firm conviction, an d continued behaviour, despite internal and 
external contexts that had not always been favour able, Uruguay believed that, rather than demanding 
answers concerning Bolivia's trade policy, Members should have been asking in what way they could 
help Members like Bolivia in this development round to make its liberalization policies sustainable.  
Uruguay had offered differential trade treatment to Bolivia and particularly free access to ports in 
Uruguay that could alleviate its land-locked status.   
128. The representative of Turkey  stated that Turkey deeply appr eciated the measures taken by the 
Bolivian Government since Bolivia's last TPR to reform and modernize its trade and investment 
regime.  Turkey also commended Bolivia's commitment to the multilateral trading system;  it maintained few and negligible trade barriers d espite being a small, land-locked economy that 
depended on a limited amount of exports.  Bolivia also faced very complex social and economic 
problems, as explained by the discussant.   
129. The Turkish authorities were working on a sp ecific programme to enhance the trade and 
economic relationship with South American countries.  Turkey shared the Bolivian view on trade 
negotiations from the perspective of th e developing countries' interests.   
130. The representative of Costa Rica
 highlighted Bolivia's compromise with the multilateral 
trading system and its efforts to strengthen it.  Cost Rica shared Bolivia's  objective of increasing the 
participation of developing countries in intern ational trade through the ongoing Doha negotiations, 
particularly by fulfilling the commitments to absolu te liberalization of trade in tropical products as 
well as substitutes for illegal crops.  The fulfilment of this mandate would allow Bolivia, like many 
other developing countries, to increase its expor t supply, reduce its dependency on a few export 
products, and a few markets, and improve the standard  of living of its people.  International trade 
would thus continue to drive the Bolivian economy, as it has done in recent years. 
131. Fulfilment of the agricultural mandate in othe r areas, such as substantial cuts in trade-
distorting internal aid and the elimination of export s ubsidies, would also help to correct the situation 
of countries like Bolivia, which did not apply trad e-distorting measures but suffered the consequences 
of such measures in international markets.  Agri cultural liberalization at the multilateral level would 
also help to increase national and foreign investme nt in Bolivia, particularly in sectors aimed at 
exporting, and improve the level of investment flows. 
132. The representative of Guatemala  stated that Bolivia was an important trade partner for 
Guatemala, particularly in the context of the WTO.  Guatemala saw itself in many of the actions taken 
by Bolivia as a small economy within a global context;  Bolivia and Guatemala were members of the Cairns Group and the G-20.  It was important to  emphasise and commend the Government of Bolivia 
for its policies based on the free-market model;  cons istent with this appro ach, Bolivia did not apply 
restrictions to trade in goods and services.  A funda mental aspect of Bolivia's trade policy, similar to 
that of Guatemala's, was its active participati on in regional integration processes, including the WT/TPR/M/154 
Page 20  
 
negotiation and signing of trade agreements with different countries, thus strengthening market 
openings and free trade. 
133. Guatemala had pushed with Bolivia for the ac knowledgement of the difficulties and needs of 
small economies in the multilateral trading system and, in that sense, in fulfilment of paragraph 35 of 
the Doha Declaration, both countries had made it a priority that the Working Programme for Small 
Economies be a fundamental issue with substan tial results at the WTO Ministerial Meeting. 
134. The representative of Venezuela
 acknowledged the efforts of the Government of Bolivia, in 
spite of internal and external problems, to prov ide greater competitiveness and equality, and to adapt 
to an international economic context that meant many challenges, particularly for a country that faced 
the problem of access to the sea for its effective participation in the world economy. 
135. In the context of this Review, it was important  to highlight the conclusion reached in both 
reports about the role of foreign trade in the Boli vian economy.  This was proven by Bolivia's active 
participation in the various integration schemes in  South America and the search for new markets as 
part of its trade policy, as well as the efforts made at the multilateral level, especially in the WTO, 
where it was an active participant. 
136. Bilateral relations between Venezuela and Bo livia were framed by historical links and 
friendship concretized in the Andean Community.  Bolivian exports had shown a sustained increase in 
the period under review resulting in a favourable bi lateral trade balance for Bolivia.  This was the 
base for immense potential for cooperation in the co ntext of regional and multilateral integration in 
key strategic sectors for the region. 
137. The representative of Ecuador  highlighted the importance of carrying out this type of exercise 
as well as the continuity of the Bolivian Government's  effort.  Ecuador had been reviewed for the first 
time this year, and had witnessed its usefulness bot h for the domestic institutions and for Members, 
although it was also aware of the great efforts needed to finalize the documentation and have a 
successful TPR.  
138. Bolivia and Ecuador had a long and close histor ical, political, trade, economic, and social 
history.  They were both members of the Andean Community, of the ALADI, of the CAN-
MERCOSUR Agreements, of the Amazon Coopera tion Treaty, and of the South American 
Community of Nations.  They shared the ATPDEA system of preferences with the United States and 
the Generalized System of Preferences-Plus with  the EU, in a common responsibility to eradicate 
illicit crops in the region.  Ecuador  hoped that Bolivia would soon be an integrated member of the 
final agreements reached in the ongoing negotiations with the United States, with Peru, and Colombia.  
139. At the multilateral level Ecuador shared Bolivia 's expectations of better and bigger market 
access for their products, particularly agricultura l products, and specifically tropical products and 
substitutes for illicit crops.  Ecuador and Bolivia we re members of the informal group on tropical 
products, and while Ecuador was not part of the G- 20 it shared the majority of its aspirations and 
proposals.   
140. Bolivia's tariff was ad valorem , thus providing predictability.  In services, Ecuador 
highlighted the effort made by Bolivia in presenti ng its initial and revised offer, and its interest in 
further liberalization in mode-4 supply for its service providers. 
141. Ecuador agreed with Peru, that it was essential to  find a solution to the problem of the system 
of patents under the TRIPS Agreement in resp ect of the Convention on Biodiversity and the 
Cartagena Protocol on Biosafety.  As countries that  had a long historical tradition of folklore and 
traditional knowledge, Ecuador a nd Bolivia joined with the proposals at the WTO aimed at 
guaranteeing the observance of both populations' legitima te social and economic rights in this respect.    WT/TPR/M/154 
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142. Ecuador highlighted Bolivia's compromise with the multilateral trading system and its 
continuous contributions to make  the Doha Round a Round for development.  Ecuador was concerned 
with some of the statements in the Secretariat repo rt.  It stated that a direct link between further 
liberalization and greater investment had not be pr oven, nor was it proven that greater liberalization 
automatically generated higher growth.  Bolivia was fulfilling its commitments, with ample trade 
liberalization, but it also faced problems of access and costs, and in that sense Members had to make 
greater efforts to find the real link.  Bolivia had proved, however, that technical cooperation and 
capacity building for developing countries was bearing fruit at the WTO.   
143. Ecuador was interested to know Bolivia's vi ew of the role of multilateralism vis-à-vis 
regionalism and what its priorities would be in the case that multilateralism did not fill its 
expectations in the current round of negotiations.  It was also important to find out what was the 
Bolivian perception about the principal measures that its trading partners could adopt at the WTO to 
increase its exports and enhance economic growth. WT/TPR/M/154 
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V. REPLIES BY THE REPRESENTATIVE OF BOLIVIA AND ADDITIONAL 
 COMMENTS 
144. The representative of Bolivia noted that statem ents had highlighted Bolivia's efforts to 
continue with the market model and to push forwar d its structural and institutional reforms, and the 
process of adaptation to multilateral rules in a conf lictual political and social environment.  These 
reforms had not, however, produced the desired resu lts in terms of growth and poverty reduction. 
145. With respect to the multilateral negotiations  under the current Doha Round, Members had 
also highlighted Bolivia's active participation as a developing country, its constructive spirit, and its 
willingness to come up with proposals, particularly  in the areas of agriculture, trade facilitation, 
services, and intellectual property.  Regarding the questions received, to which detailed replies had 
been made available to Members, Bolivia revert ed to three areas:  (i) economic and institutional 
environment;  (ii) trade policies by measure;  and (iii) sectoral policies. 
(i) Economic and Institutional Environment 
146. As recognized by the discussant and other Memb ers, Bolivia's limited exportable supply and 
current reliance on a handful of markets meant that it was faced with an urgent need to broaden its 
options and improve its market access conditions, par ticularly in the developed countries.  This would 
have been both a contribution and a response to the efforts of its economic ope rators to boost growth, 
reduce poverty, and improve the standard of living. 
147. As mentioned by Peru and Ecuador among others, efforts to diversify production, particularly 
via alternative development programmes aimed at  providing substitutes for excess coca leaf crops, 
were set to continue with the backing of the international community on the basis of shared 
responsibility.  Regarding the status of the Bolivia n Integral Strategy for the Struggle Against Drug 
Trafficking, the road infrastructure had been improve d, and this had helped more than 40,000 farming 
families, involved in the alterna tive production of bananas, cocoa, coffee, pineapple, palm hearts, 
passion fruit, pepper, citrus fruits , and other tropical fruits, who, in order to consolidate their 
production, required rapid access to markets free of tariffs, tariff quotas, non-tariff barriers, and 
trade-distorting measures. 
148. Bolivia's ability to attract investment would improve as it became more fully integrated and 
participated more actively in international trade,  enabling it to reduce the level of poverty in the 
country.  With respect to investment guarantees, Law 1770 provided a legal framework for dispute settlement and arbitration.  There were also a nu mber of multilateral and bilateral agreements that 
reinforced legal certainty for foreign investors. 
149. Multilateral trade rules formed the disciplinary framework governing the relationship between 
countries involved in regional and sub-regional ec onomic integration processes, which served to 
deepen trade liberalization.  At  the same time, multilateralism contributed to the development, 
expansion, and diversification of  trade, and to fuller integration in international trade on a non-
discriminatory basis, giving countries access to effici ent sources of supply.  It also guaranteed the 
predictability of compliance with the commitme nts assumed, as well as special and differential 
treatment in response to Bolivia's development needs and priorities. 
(ii) Trade Policies by Measure 
150. Members had viewed the institutional reforms,  in particular to the National Customs 
Administration, as a substantial contribution to trade facilitation, which had acquired a certain 
importance in the WTO negotiations.  Bolivia's c ontribution to this process, aimed at reducing 
transaction costs, had focused mainly on the simpli fication and facilitation of foreign trade operations 
through computerization, and by setting up an Oper ative Customs Control Unit, whose mission was to  WT/TPR/M/154 
 Page 23 
 
 
prevent, control, and suppress fraud and smuggling at  customs, along the roads, and at the border.  
Also worth stressing was the effort to strengthen institutions by selecting professional and technical staff on the basis of merit. 
151. Bolivia would begin to close the gap between the bound tariff and the applied tariff both in 
the agricultural negotiations and in the negotiations on industrial goods, in accordance with the offers 
and flexibilities and with the needs and interests of  the developing countries in such a way as to 
ensure their fuller integration in the multilateral trading system.  Members also expressed concern 
with respect to the measures or actions to fight pi racy.  Bolivia had introduced institutional reforms in 
this area, with the creation of the National Intell ectual Property Service, which, as a statutory body 
responsible for the protection of intellectual propert y rights in all areas, had commenced the seizure 
and destruction of pirated goods.  Certain delegations had enquired as to the status of the draft 
intellectual property code:  more time would be required for review, since the code would bring 
together in a single set of regulations all areas of intellectual property, thereby enhancing protection in 
accordance with the agreem ents and conventions to which Bolivia  was a party, as well as amendments 
currently being negotiated. 
(iii) Sectoral Policies 
152. Concern was expressed regarding the hydrocarbons  sector, and specifically, the new law, its 
regulations, and those being drafted.  These prov isions established legal certainty for foreign 
investment and were aimed at ensuring fair distribution of income between the companies and the State, in accordance with the principle of social responsibility of enterprises. 
153. Members were also interested in services, where most questions concerned sectors and 
subsectors in which Bolivia was asked to step up its efforts to open up its market and schedule 
commitments.  These requests would be considered  in the "request/offer" negotiating process, the 
approach agreed upon in Doha for the progressive liberalization of this important trade sector. 
154. Bolivia had provided detailed responses to qu estions on regulatory/technical aspects of 
implementation, with respect to various services, such as telecommunications, transport, tourism, 
professional services, insurance, and postal services. 
155. The discussant
 wished to comment generally on deve loping countries, stabilization policies, 
the reform process, the relationship between the WTO and regionalism, and some specific issues 
mentioned.  In Bolivia's case, th e issue of stabilization and growth was notorious, as was that of those 
two very important issues and political and social stability. 
156. Regarding the interrelation between stabilization,  growth and social stability, in spite of a 
great effort by Bolivia to achieve stability and est ablish policies to allow a fiscal adjustment, reduced 
inflation, in general the objectives of a stabili zation programme, the Bolivian economy did not grow 
much during the period under review.  Moreover, the economy was also subjected to a process of 
internal divergence, a conflictive process from the social and political point of view.   
157. Various Members, like the EU and Switzerland, not ed the role of international cooperation.  
An example of this was the condonation of Bolivia's debt with several countries, which contributed to 
an improvement in the social and political stabilization of Bolivia.   
158. Another important point was the interrelation between structural reforms (amongst which was 
the liberalization of the economy), institutional refo rms and growth.  Most Members noted and agreed 
that Bolivia had made important structural refo rms, institutional reform s, custom law reform, 
streamlined its foreign trade regime, tariff reducti on, a process of opening the economy, attempted to 
modernize its intellectual property law, and new ex port promotion programmes.  In summary, there 
were important reforms that combined institutiona l reforms with opening the economy.  There was a WT/TPR/M/154 
Page 24  
 
necessary link between those reforms and growth, but in spite of these reforms, growth rates in the 
Bolivian economy did not match.  There had been a significant increase in exports recently but this 
was related mainly to hydrocarbons and natural gas, specially to neighbouring countries.   
159. Bolivia needed to diversify its export base, wh ich was in part connected with the issue of 
substitute crops.  In that sense, there was an issue of access, which had to do with the WTO and free 
access to tropical products, an issue that interested  a number of countries besides Bolivia.  This could 
be one of the objects of the Doha Round.   
160. On the other hand, market access was clearly only a part of the issue.  Diversification had to 
do with the supply side and Bolivia's need to  develop its export produc ts, which would demand 
further investment in Bolivia.  In that sense, fore ign investment would play a role, as noted in the 
TPR, as well as the link between the reform process in  Bolivia and the investment flow.  During the 
period under review, foreign investment flows were not very positive, and this was important in 
diversification.   
161. The regional dimension was clearly establis hed for the Bolivian economy.  Bolivia's 
relationship with its neighbours, taking into acco unt its geographical position in the middle of the 
continent, was an important aspect of its trade policy.  Regionalism demanded a multilateral trading 
system that worked, that advanced regionalism, and that created multilateral rules.  This was reflected 
in the regional and multilateral aspects of Bolivia's  trade policy, which attempted to combine reaping 
the benefits of preferential regional regimes and its commitments in the multilateral negotiations and 
participation in the Doha round.   
162. Investment and intellectual property were mentioned as important issues by Members;  
Bolivia had provided answers from an institutional a nd legal point of view.  Members also mentioned 
services, and the issue of further liberalization.  The Bolivian delegation had replied that this would 
take place within the context of the Doha round.  It is noteworthy that a lthough Bolivia was a small, 
developing country it had presente d initial and revised offers in services, seeking to fulfil the 
commitments in the negotiations.   
163. The gap between bound and applied tariffs reflected  the limited ability to apply other types of 
import control policies.  Countries with a less comp lex institutional structure had difficulties to apply 
anti-dumping measures, safeguard measures, and c ountervailing measures;  according to the report 
from the government it can be inferred that this ha d been the case during the period under review as 
Bolivia did not apply any of these measures, to preven t disruption of the market or unjust trade.  Thus, 
the difference between applied and bound tariffs played  a fundamental role.  By virtue of the many 
agreements signed by Bolivia there was a limit to th e mobility of the applied tariff in respect to the 
consolidated one.  This was an issued that could be discussed in the context of the Doha round.   
164. The representative of the EU
 noted that the Secretariat report had stated that public discontent 
had provoked the cancellation of various public concessi ons to foreign companies, not long after they 
had been granted.  He asked how the Bolivian authorities would respond to these social pressures 
against foreign investment firms and whether the Bolivian Government had any plans to re-
nationalize public companies that had already been privatized. 
165. The representative of Bolivia  said that Bolivia would respond to the EU's question in writing.  WT/TPR/M/154 
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VI. CONCLUDING REMARKS BY THE CHAIRPERSON 
166. This third Trade Policy Review of Bolivia h as contributed to an improved understanding of 
Bolivia's trade and related policies, as well as of th e challenges it faces.  The Country and Secretariat 
Reports, the exchanges between Members during th e review, and the written responses provided by 
Bolivia to questions by Members have added to th e transparency that is sought within the WTO, 
provided valuable resource materials for all Me mbers, and offered useful insights for policy 
formulation in Bolivia.  The participation of Vi ce-Minister Asín, Ambassador Moscoso and their 
delegation greatly contributed to our work, for whic h we express our sincere thanks.  Our thanks are 
also due to our discussant, Ambassador Hugueney, for his insightful contribution to our discussions, 
and to the many Members who have intervened to contribute to the success of this review. 
167. Members welcomed Bolivia's recent export-driven  growth but were troubled by the stagnation 
of per capita income since its previous Review in 1999.  Moreover, although dynamic, exports were 
still concentrated in a handful of products and mark ets.  Several Members considered that Bolivia's 
landlocked situation created significant constraints to  development and trade but it was also suggested 
that there were ways in which these constraints c ould be eased.  Thus, Bolivia was encouraged to 
increase investment in infrastructure and in human  capital.  It was also invited to promote 
competition, including through the adopti on of a comprehensive competition law. 
168. Members noted Bolivia's political and social instability in recent years.  Against the 
background of already falling foreign investment , they expressed concerns over the uncertainty 
introduced by the adoption of the new Hydrocar bons Law, and its effects on both domestic and 
foreign investment.  In this connection, Bolivia c ould provide greater predictability to its investment 
regime by anchoring it externally through multilate ral commitments.  In particular, some Members 
invited Bolivia to make further GATS commitments in  specific areas, which currently fall far short of 
the actual level of liberalization of Bolivia's services sector.  
169. Members commended Bolivia for its strong commit ment to trade liberalization despite the 
difficulties it experienced during the period under review.  In the long term, this commitment will place Bolivia in a good position to reap the benef its of increased trade and economic growth.  
Members also praised Bolivia for its active partic ipation in the WTO including in the DDA.  Members 
noted Bolivia's participation in a number of pr eferential trade agreements, and highlighted the 
importance of ensuring that these agreements complement the multilateral trading system. 
170. There was general praise for Bolivia's effort s to modernize and simplify its trade regime, 
which was considered on the whole open.  Member s welcomed Bolivia's efforts to facilitate trade 
although they also mentioned that customs proce dures could be further streamlined.  In addition, 
Bolivia was invited to reduce the gap between app lied and bound tariffs.  One Member suggested that 
Bolivia take steps to reduce inform al trade, while some others inv ited it to ensure that SPS measures 
do not impose unnecessary barriers to trade.  Member s welcomed Bolivia's efforts to improve IPR 
protection and encouraged it to complete the pro cess initiated in 2001 to adopt a new law.     
171. This brings us to the conclusion of Bolivia's third Trade Policy Review.  I thank the Bolivian 
delegation for the responses provided during the m eeting and look forward to receiving answers on 
outstanding questions.  I welcome Bolivia's stated  conviction that an open trade and investment 
regime contributes to economic development and pove rty alleviation.  This outward orientation 
together with a coherent approach to address intern al problems will be critical for Bolivia to achieve 
faster, sustainable growth.  The external environment is important as well.  In this respect, I invite Members to address the trade barriers that affect Boliv ia's trade.  I also urge Bolivia to enhance its 
multilateral commitments in the context of the DDA  both to help strengthen the multilateral trading 
system and to provide its trade regime with greater predictability. 
__________