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Legislative Reform in Bolivia: The 2026 Investment Law Bill and National Regulatory Framework

By PPO Indacochea

On August 11, 2026, the executive branch of the Bolivian government, led by President Rodrigo Paz and Minister of Economy and Public Finance José Gabriel Espinoza Yáñez, officially submitted the 103-article Investment Law Bill (Proyecto de Ley de Inversiones) to the Plurinational Legislative Assembly (Asamblea Legislativa Plurinacional).

The legislative initiative introduces a modernized legal architecture designed to promote, regulate, and protect both domestic and foreign capital over a 20- to 30-year operational horizon. Formulated to replace legacy regulatory mechanisms, the draft statute seeks to rebuild investor confidence, streamline administrative protocols, and address ongoing economic challenges by institutionalizing statutory guarantees, equal legal treatment, and predictable commercial terms across primary and emerging economic sectors.

The introduction of the legislation comes during a crucial period for Bolivia’s national economy, which has experienced structural contraction and shifting labor market dynamics. Official data published by the National Institute of Statistics (Instituto Nacional de Estadística—INE) indicates that Bolivia's Gross Domestic Product contracted by 1.58% in 2025, driven largely by significant downturns in the construction sector, which fell by 13.57%, and in natural gas and petroleum extraction, which dropped by 10.51%. Furthermore, indicators monitored by the Central Bank of Bolivia (Banco Central de Bolivia—BCB) recorded a decrease of approximately 205,000 occupied jobs between late 2025 and mid-2026. By modernizing the investment climate, public authorities aim to reverse these trends and generate sustainable, high-quality formal employment by attracting private capital into productive industries.

Structurally, the bill rests upon three main policy pillars: normalizing private investment as a core component of national economic development, establishing regulatory predictability to reduce sovereign risk, and restructuring administrative oversight through a unified National Investment System (Sistema Nacional de Inversiones). Beyond traditional industrial activities such as mining, energy, and hydrocarbons, the proposed framework explicitly expands statutory investment incentives into modern, technology-driven sectors. Key targeted areas include logistics, artificial intelligence, the digital economy, technological innovation, and alternative energy, intended to encourage technology transfer, enhance local production capabilities, and integrate the domestic economy into global value chains.

To strengthen legal certainty and curtail political discretion, the bill introduces substantial procedural constraints regarding state intervention and property rights. Under the proposed provisions, executive branch authorities are prohibited from executing unilateral expropriations or nationalizations. Any proposed asset takeover must be formally presented to and evaluated by the Plurinational Legislative Assembly, while guaranteeing compensation based on fair patrimonial valuation. In addition, the draft text establishes access to international arbitration mechanisms for commercial dispute resolution within the parameters of the 2009 Political Constitution of the State (Constitución Política del Estado), providing an institutional safeguard designed to satisfy international standards.

To execute these regulatory objectives, the draft law mandates the establishment of the National Investment Agency (Agencia Nacional de Inversiones), a centralized public body tasked with coordinating investment policies across central government ministries and subnational jurisdictions. Once enacted, the new agency will be responsible for formulating a National Investment Plan, a National Prioritization Strategy, and an International Promotion Strategy aimed at positioning Bolivia within global capital markets. Multilateral financial partners, including the Development Bank of Latin America and the Caribbean (CAF), have highlighted the initiative as a foundational step toward unlocking private sector financing and stabilizing the broader macroeconomic landscape.