The Andean Group under the sign of chaos and hope

By: Beatrice E. Rangel - 22/10/2025

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The election of Rodrigo Paz as president of Bolivia after nineteen years of MAS rule under Evo Morales and Luis Arce is seen by many analysts, including myself, as a sign of hope. Beyond Rodrigo Paz's individual qualities, the succession to authoritarianism demands two political qualities of leadership. The first is the discernment of priorities. That is, deciding wisely what to do first and what to do next. Today, it is clear to everyone that the Bolivian people have cried out for freedom. After two decades of political sectarianism, impunity for those in power, and economic chaos, the Bolivian people long for the dull days when dollars were in the Central Bank, gas reserves were growing, it was not necessary to present a party card to carry out any transaction with state authorities, and the political narrative was inclusive. Examples of this were the campaign slogans and central government lines of Victor Paz Estenssoro, Hernan Siles Suazo, and Gonzalo Sanchez de Lozada. For them, Bolivia's progress would be achieved through freedom and education, and both ingredients were deployed in their administrations. Rodrigo Paz comes from that background, but adds to his portfolio of skills the fact that he has been a mayor. Mayors are the boundary between the state and the people, and therefore they know how to read the hearts of the people. A mayor prioritizes the aspirations of the community over those of the elites. And this virtue is essential in transitions from authoritarianism to democracy. We must recall here the highly successful administration of Rómulo Betancourt in Venezuela. Added to this is the fact that Rodrigo Paz had to intervene in many political negotiations to guarantee the governability of his region when he was mayor. This quality will also serve him well in stabilizing a nation numbed by hunger and terror, where no one trusts anyone. He will then have to rebuild trust between those who govern and those who are governed. And of course, the economic challenge Paz will face cannot be underestimated. But if it manages to unite Bolivians under the banner of freedom in democracy, the Bolivian economy could revive by tapping into its reserves of lithium, rare earth elements, and gas.

In Peru, on the other hand, the revolving door installed in the presidency by the political elites may be showing signs of exhaustion. Since 2022, the country has been shaken by massive protests (some violent) against a system that has failed the masses in two ways. First, freedom. The Peruvian people feel overwhelmed by excessive regulations that stifle their entrepreneurial capacity by preventing them from developing small, successful businesses. Second, Peru has failed to grow its middle class despite its economic performance being perhaps among the leaders in Latin America. According to the OECD, Peru achieved an average annual GDP growth rate of 5.1% between 2000 and 2019, well above its Latin American peers. But this has not translated into greater prosperity for the lower-income strata. In fact, between 27% and 29% of the population lives in poverty, and 70% of the workforce is engaged in the informal economy. It is well known that informal work ties entire generations to poverty and keeps them from prosperity. And while Peru has built solid macroeconomic foundations—low public debt (in relative terms) and considerable reserves—it has not developed quality public services that serve the human progress of its population. In terms of wealth concentration, only Colombia surpasses Peru, whose Gini coefficient is 40.7. The top 1% of Peruvians control almost a third of the country's income, while the poorest 50% own only about 6%. COVID-19 has highlighted these deficiencies of the Peruvian political system, and we are seeing that the elites' strategy of imprisoning presidents to calm popular anxieties has already entered the phase of diminishing returns.

In the spring of 2026, Peru will have to elect a new head of state. And if by then a political force with sufficient foresight to unite the multitude of participating movements in a pro-democracy coalition doesn't emerge, the result will be a fragile presidency, a Congress that encroaches on the powers of the executive branch, and a country paralyzed by popular discontent. Under these conditions, the economy could suffer and the country could fall into a period of crisis that could degenerate into uncontrollable violence. This situation would surely have a negative impact on Ecuador and Bolivia.

«The opinions published herein are the sole responsibility of its author».