by Rene Quenallata Paredes
LA PAZ, Dec. 23 (Xinhua) -- The year 2016 was Bolivia's toughest year in a decade economically due to a drop in global prices for raw materials and lower regional demand for goods and services.
The government's economic forecast for 2017, however, seems brighter.
Government projections show gross domestic product (GDP) grew less than expected, while exports and revenue from gas sales dropped.
In an interview with local media on Thursday, Bolivian Economy Minister Luis Arce blamed the global economic downturn, especially in South America, for impacting Bolivia's performance.
"This has been the toughest year, not just for Bolivia, but for the rest of the world. We have seen a severe drop in the export price of raw materials, in addition to the crisis affecting neighboring economies," said Arce.
President of the Chamber of Industry, Commerce, Services and Tourism (CAINCO) Jorge Arias warned Thursday that Bolivia will register a trade deficit in 2016 for the second year in a row.
Construction was one of the sectors that continued to do well, he said, calling for measures to boost productivity in other areas to counter the economic slowdown.
According to the National Statistics Institute, GDP grew 4.43 percent in the second half of the year, which prevented the government from authorizing a double year-end bonus for public-sector workers.
In September, Arce downgraded this year's economic growth forecast from 5 to 4.8 percent because the worst drought in 25 years has hit Bolivia.
GDP in 2017 is also expected to see 4.8 percent growth.
Bolivia's exports, up to October, dropped 20.7 percent compared to the same period the year before because of the price drop of gas exports to Brazil and Argentina.
Up to October, the trade deficit amounted to 782.3 million U.S. dollars, but the figure for the whole year is expected to surpass the figure for 2015, which was 1.034 billion dollars.
Recent measures by oil-producing countries to shore up oil prices and stabilize raw material prices should improve the economic outlook in 2017, said Arce.
"Oil is stabilizing, which is why we believe 2017 will see a much better Bolivian economy than this year," said Arce, adding "the outlook for the country is positive."
Bolivia, whose GDP expanded in 2016 amid a bleak global economy, will continue to serve as a model of growth for the region, he said.
