Analysis: Impacts on the Business
Bolivia is an attractive country for companies seeking to invest in or establish a company in the agricultural, mining, energy or telecommunications sectors. The Bolivian government has developed a strong relationship with the US and has developed an investment climate favorable to foreign direct investment.
An important consideration for establishing a new company in Bolivia is to select a government favored sector where direct investment is favored. Mining, agriculture, and energy are important sectors of the economy and offer the most opportunities.
Serious considerations, however, must be given to the current infrastructure and transportation systems in Bolivia. The most attractive industries will not necessarily be located in one of the three largest cities potentially requiring a substantial capital investment for a new firm. Bolivia is a country with rich natural resources and could be a very attractive investment for a company seeking to expand its world-wide holdings in a particular economic sector.
At this point it is too soon to tell if Bolivia would be an attractive investment for a company requiring substantial IT resources. Once privatization of the telecommunications industry is complete in 2001, Bolivia will need to rapidly upgrade its infrastructure to become an attractive investment climate for companies requiring highly sophisticated technology and technology support. However, wireless and satellite applications are already increasing rapidly so software development focused on wireless applications may be a dynamic opportunity and offer quite a few first mover advantages.
