LA PAZ (Reuters) – Bolivia’s senate early on Friday morning gave final approval to a so-called “gold law” aimed at strengthening the country’s foreign currency reserves.
The legislation, which was supported by the ruling party and allows the central bank to monetize its gold reserves, will now be sent to President Luis Arce to sign into law within 10 days.
Fears over a shortage of dollars in recent months have fanned broader worries over an economic crisis in Bolivia, where foreign currency reserves have been falling for years and where the local currency is pegged to the greenback.
In a statement after the vote, Bolivia’s central bank said the law was the result of a “consensus with gold producers, mining cooperative members, social and union organizations from different sectors and national legislators.”
The new law will allow the central bank to buy raw gold from mining cooperatives in the country and convert it into gold currency or bars to trade on international markets.
“We have approved the law by majority … It is to ensure a stable economy in the plurinational state,” said Hilarion Mamani, a senator for the ruling leftist party MAS.
Bolivia’s net foreign reserves have fallen from a peak above $15 billion in 2014 to less than $4 billion now.
“Bolivia has a deep crisis and this law is only a palliative,” said opposition Senator Andrea Barrientos after the debate.