Bolivia has been a landlocked nation since 1879, when it lost its coastal department of Litoral to Chile in the War of the Pacific. Bolivia's government remains heavily dependent on foreign assistance to finance development-projects. Bolivia is a member of the Andean Community and enjoys nominally free trade with other member countries (Peru, Ecuador, Colombia, and Venezuela).

Bolivias most lucrative agricultural product continues to be coca, of which Bolivia is currently the worlds third largest cultivator. Bolivia became an associate member in 1997 in order to open investment opportunities with the founding Mercosur countries (Argentina, Brazil, Paraguay, and Uruguay), as well as other Mercosur associate members (Chile, Colombia, Ecuador, Peru, and Venezuela).

Bolivia is a member of the Andean Community, an economic organization of South American countries. Bolivia has the second-largest natural gas reserves in South America. Bolivia's nine departments received greater autonomy under the administrative decentralization law of 1995, although several departments--especially Santa Cruz and Tarija--are seeking increased autonomy.

Bolivian police state that there are eight organized criminal groups operating in the La Paz area. Bolivia plans to expand, at least for a limited time, legal coca production to 20,000 hectares and stresses development of legal commercial uses for coca leaf. Bolivia is as rich in geographical wonders as it is in mineral riches. The Peruvian-Bolivian forces achieved several major victories: the defeat of the Argentinian expedition and the defeat of the first Chilean expedition on the fields of Paucarpata near the city of Arequipa.

During this time, the umbrella labor-organization of Bolivia, the Central Obrera Boliviana (COB), became increasingly unable to effectively challenge government policy. An enormous diversity of ecological zones are represented within Bolivia's territory. The great majority of Bolivians are Roman Catholic (the official religion), although Protestant denominations are expanding strongly. The economy of Bolivia has had a historic pattern of a single-commodity focus. External creditors have been willing to do this because the Bolivian Government has generally achieved the monetary and faget targets set by IMF programs since 1987, though economic crises in recent years have undercut Bolivia's normally good track record. Additionally, cotton, coffee, and sugarcane have been viable exports for Bolivia.

Mesa had increased taxation on foreign companies while still encouraging their investment in Bolivian energy development. Foreign participation and investment in Bolivian banks are allowed. In 1995 the United States, among other countries, reduced Bolivias debt by two-thirds.