THE LEGATUM PROSPERITY INDEX™ 2016

Bringing Prosperity to Life

Bolivia

Ranked 79th of 149

At a glance

Ranks

79 th on the Legatum
Prosperity Index™

80th
123rd
73rd
82nd
105th
77th
42nd
72nd
81st

SUB-INDEX RANKINGS

In the Prosperity Sub-Index rankings, Bolivia performs best on Personal Freedom and Social Capital and scores lowest on the Business Environment sub-index.

Visit our Rankings table to see how Bolivia compares to other countries.

Prosperity Gap

The ‘Prosperity Gap’ takes a country's GDP and uses it as the yardstick to measure a nation's expected Prosperity Index ranking.

Despite a couple of small prosperity deficits in 2008 and 2010, Bolivia has now established a small but firm prosperity surplus, based on a significant surplus in Personal Freedom, and small surpluses in areas like Education and Safety & Security.

Note:
In the chart above, each dot represents a country. The curve shows the general tendency with which prosperity increases as GDP per capita increases. If a country falls below the curve, then we can say that compared to all other countries, it is under-delivering prosperity for its citizens. Likewise, if a country rises above the curve, then we can say that it is over-delivering prosperity for its citizens. Learn more about the Prosperity Gap here.

Alternatively, have a look at the Prosperity Gap view on our Rankings table for a full list of countries and to see how each of them are performing on the various sub-indices.

Commentary

Bolivia, a South American country that follows the all too common story of a 20th century history marred by dictatorships, military juntas and international intervention, is beginning to see an improvement, moving from 91st to 79th in the Prosperity Index over the past decade. However, Bolivia’s state of affairs is not all positive, with the economy being illustrative of this battle between improvement and tempting deprivation, as Economic Quality impressively climbs the rankings, whilst Business Environment continues to fall further down toward the bottom of the ranks.

Bolivia’s global rank in Economic Quality and Business Environment, where 1 is the top global rank and 149 the bottom.
While Bolivia has gradually risen up the global rankings in Economic Quality, its Business Environment ranking has slipped down the rankings.

Bolivia has seen an impressive decade within the Economic Quality sub-index, rising 19 places to reach 80th. This is undoubtedly related to its falling unemployment rate, which currently stands at 2.7% (low in regional, continental and global standards), as well as falling poverty rates and a more effective anti-monopoly policy, amongst other improving variables. That export and import diversity rates have both declined however, marring an otherwise positive Economic Quality sub-index can be attributed to the falling Business Environment ranking which has fallen five ranks; although not an entirely disastrous fall, when considering Bolivia has slumped from 118th to 123rd, it is more of a concern. Bolivia may have made gains here in real terms, but competitively this has not been fast enough to keep pace. Once initially rising in the Logistics Performance Index, Bolivia is now falling again, accompanied by a faltering in labour market flexibility and a reduction in obtaining credit, with even variables that improved, such as ease of reducing insolvency, remaining at low levels relative to the rest of the continent.

Along with a faltering Business Environment, Health is a further sub-index that is looking particularly worrying. Again, while improving in real terms, it has not risen fast enough to prevent a four rank fall, confirming its place in the triple figure rankings at 105th. Although between 2007 and 2016 the only real variables of concern were rising obesity and diabetes rates, several others are grounds for easy gains. In particular, improved sanitation facilities are only just over 50%, a low figure that could be easily dealt with.

Improvements to Personal Freedom and Safety & Security somewhat distract from these negativities from standing out however. Safety & Security has seen an improvement across almost every variable, with only the number of homicides slightly increasing to affect the ranking negatively. Personal Freedom conveys a similar story, although leaves itself slightly more open to criticism: press freedoms are disappearing at an annual rate, and there are many variables which haven’t moved that are currently marring greater progress, such as few LGBT rights combined with a lack of openness towards the LGBT community as a whole. Nevertheless, Bolivia ranks within the global top 50 in this sub-index.


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Data

How to read this graph:
When comparing multiple countries on a spider chart, data points that appear
further away from the center represent a better performance to the points that are closer to the center.