What role do political parties and leaders play in pro-poor reform processes in Bolivia? What are the incentives and disincentives for advancing pro-poor reform? This paper from the National Democratic Institute for International Affairs identifies specific characteristics of Bolivia’s political environment that affect the pace of reform, and highlights their roots in structural, institutional and behavioural factors. It recommends that international assistance should be designed to account for current system failures in the short term and to empower self-sustaining reform in the long run.
Despite Bolivia’s excellent strategic plans and a commitment to democracy, the country is characterised by gross inequality and poverty. Domestic reforms and foreign assistance packages have had limited success in promoting economic inclusion. Beneath Bolivia’s democratic institutions, mutually reinforcing networks of wealth, ethnicity and political authority perpetuate exclusion. There is widespread public dissatisfaction with the political elite, and a general sentiment that the country’s political leaders are too self-interested to promote meaningful reforms. Previously excluded groups, in particular indigenous groups, are now strenuously asserting their right to economic and political participation.
Sustainable poverty reduction will ultimately require the constructive involvement of all political parties. Political parties control nearly all levers of state authority, and will continue to do so for some time. As the only official non-state link among all levels of government, they are one of the few domestic mechanisms capable of coordinating policy formation and implementation. However:
- Constructive competition among political actors is absent. Consequences of this include collusion among political groups and reduced incentives for parties to coordinate policy or pursue deep reform.
- Existing and emerging centres of political strength in Bolivia are polarising vehicles for economic and political participation in society. This prevents incremental reform and may reinforce segregation.
- Political parties are not opposed to poverty reduction but there are several strong disincentives for actively pursuing the types of reform needed to achieve sustainable change.
- As a result, the party system is centralised and lacks the internal communication, decision making and coordination mechanisms needed to pursue specific reforms in a consistent and effective manner.
Transitions such as that required in Bolivia are typically either stable and lengthy, or rapid and accompanied by a period of more extreme instability. This duality must shape donor support, which should be designed to account for current system failures in the short-term and to empower self-sustaining reform in the long run.
- There is a need for structural reform that deconstructs political appointment practices and reinforces healthy political competition. These reforms are political and likely to meet strong resistance from entrenched interests.
- Support for long-term institutions will not only bolster the social capital needed to overcome years of political and economic exclusion, but also satisfy the demands of emerging democratic institutions.
- Lending and monitoring mechanisms or timetables should be sufficiently flexible to accommodate the inherently political process of reducing poverty and exclusion.
- In the short term, technical assistance should focus on promoting healthy political competition and focusing new political actors on the constructive aspects of formal political involvement.
- Restoring confidence in political communication through public education and expectation management is another area for technical assistance.
