Communications.—Under a treaty with Brazil in 1903 and with Chile in 1904 (ratified 1905) provisions were made for railway construction in Bolivia to bring this isolated region into more effective communication with the outside world. Brazil agreed to construct a railway around the falls of the Madeira (about 180 m. long) to give north-eastern Bolivia access to the Amazon, and paid down £2,000,000 in cash which Bolivia was to expend on railway construction within her own territory. Chile also agreed to construct a railway from Arica to La Paz, 295 m. (the Bolivian section becoming the property of Bolivia fifteen years after completion), and to pay the interest (not over 5%) which Bolivia might guarantee on the capital invested in certain interior railways if constructed within thirty years, providing these interest payments should not exceed £100,000 a year, nor exceed £1,600,000 in the aggregate. Argentina had already undertaken to extend her northern railway from Jujuy to the Bolivian frontier town of Tupiza, and the Peruvian Corporation had constructed for the Bolivian government a short line (54 m. long) from Guaqui, on Lake Titicaca, to Alto de La Paz, which is connected with the city of La Paz, 1493 ft. below, by an electric line 5 m. long. This line gives La Paz access to the Peruvian port of Mollendo, 496 m. distant, and promises in time to give it railway communication with Cuzco. Rivalry for the control of her trade, therefore, promises to give Bolivia the railways needed for the development of her resources. Up to 1903 the only railways in Bolivia were the Antofagasta and Oruro line, with a total length of 574 m., of which 350 m. are within Bolivian territory, a private branch of that line (26 m. long) running to the Pulacayo mines, and the line (54 m. long) from Guaqui to Alto de La Paz—a total of only 430 m. As a result of her war with Chile in 1878-81, the railways (282 m. long) of her Litoral department passed under Chilean control. Lines were in 1907 projected from La Paz to the navigable waters of the Beni, from La Paz to Cochabamba, from Viacha to Oruro, from Uyuni to Potosi and Sucré, from Uyuni to Tupiza, and from Arica to La Paz via Corocoro. The central northern line of the Argentine government was completed to the Bolivian frontier in 1908, and this line was designed to extend to Tupiza. The undertaking of the Arica-La Paz line by the Chilean government, also, was an important step towards the improvement of the economic situation in Bolivia. Both these lines offer the country new outlets for its products.
Public highways have been constructed between the large cities and to some points on the frontiers, and subsidized stage coaches are run on some of them. The roads are rough and at times almost impassable, however, and the river crossings difficult and dangerous. The large cities are connected with one another by telegraph lines and are in communication with the outside world through Argentina, Chile and Peru. Telegraph service dates from 1880, and in 1904 there were 3115 m. in operation, of which 1936 belonged to the state and 1179 to private corporations. The latter includes the lines belonging to the Antofagasta and Oruro railway, which are partly within Chilean territory. Bolivia is a member of the International Postal Union, and has parcel and money order conventions with some foreign countries. Special agreements have been made, also, with Argentina, Chile and Peru for the transmission of the Bolivian foreign mails.
The loss of her maritime department has left Bolivia with no other ports than those of Lake Titicaca (especially Guaqui, or Huaqui, which trades with the Peruvian port of Puno), and those of the Madeira and Paraguay rivers and their affluents. As none of these can be reached without transhipment in foreign territory, the cost of transport is increased, and her neighbours are enabled to exclude Bolivia from direct commercial intercourse with other nations. An exception formerly existed at Puerto Acré, on the Acré river, to which ocean-going steamers could ascend from Pará, but Brazil first closed the Purús and Acré rivers to foreign vessels seeking this port, and then under a treaty of 1903 acquired possession of the port and adjacent territory. Since then Bolivia’s outlet to the Amazon is restricted to the Madeira river, the navigation of which is interrupted by a series of falls before Bolivian territory is reached. The Bolivian port of entry for this trade, Villa Bella, is situated above the falls of the Madeira at the confluence of the Beni and Mamoré, and is reached from the lower river by a long and costly portage. It is also shut off from the navigable rivers above by the falls of the Beni and Mamoré. The railway to be built by Brazil will remedy this unfavourable situation, will afford a better outlet for north-eastern Bolivia, and should promote a more rapid development of that region, which is covered with an admirable system of navigable rivers above the falls of the Beni and Mamoré. Connected with the upper Paraguay are Puerto Pacheco on Bahia Negra, Puerto Suarez (about 1600 m. from Buenos Aires by river), on Lake Cáceres, through which passes the bulk of Bolivian trade in that direction, and Puerto Quijarro, on Lake Gaiba, a projected port said to be more accessible than any other in this region. Whenever the trade of southern Bolivia becomes important enough to warrant the expense of opening a navigable channel in the Pilcomayo, direct river communication with Buenos Aires and Montevideo will be possible.
Industries.—Stock-raising was one of the earliest industries of the country after that of mining. Horses, formerly successfully raised in certain parts of the north, have not flourished there since the introduction of a peste from Brazil, but some are now raised in La Paz and other departments of the temperate region. The Jesuit founders of the Mojos missions took cattle with them when they entered that region to labour among the Indians, with the result that the Mojos and Chiquitos llanos were soon well stocked, and have since afforded an unfailing supply of beef for the neighbouring inland markets. Their inaccessibility and the costs of transportation have prevented a development of the industry and a consequent improvement in stock, but the persistency of the industry under conditions so unfavourable is evidence that the soil and climate are suited to its requirements. Farther south the llanos of Chuquisaca and Tarija also sustain large herds of cattle on the more elevated districts, and on the well-watered plains of the Chaco. There are small districts in La Paz, Potosi and Cochabamba, also, where cattle are raised. Apart from the cattle driven into the mining districts for consumption, a number of saladeros are employed in preparing (usually salting and sun-drying) beef for the home markets. The hides are exported. Goats are raised in the warm and temperate regions, and sheep for their wool in the latter. On the higher and colder plateaus much attention is given to the breeding of llamas and alpacas. Another industry of a different character is that of breeding the fur-bearing chinchilla (C. laniger), which is a native of the higher plateaus. The Bolivian government has prohibited the exportation of the live animals and is encouraging their production.
The agricultural resources of the republic are varied and of great value, but their development has been slow and hesitating. The cultivation of cereals, fruits and vegetables in the temperate and warm valleys of the Andes followed closely the mining settlements. Sugar-cane also was introduced at an early date, but as the demand for sugar was limited the product was devoted chiefly to the manufacture of rum, which is the principal object of cane cultivation in Bolivia to-day. The climatic conditions are highly favourable for this product in eastern Bolivia, but it is heavily taxed and is restricted to a small home market. Rice is another exotic grown in the tropical districts of eastern Bolivia, but the quantity produced is far from sufficient to meet local requirements. Tobacco of a fair quality is produced in the warm regions of the east, including the yungas valleys of La Paz and Cochabamba; cacáo of a superior grade is grown in the department of Beni, where large orchards were planted at the missions, and also in the warm Andean valleys of La Paz and Cochabamba; and coffee of the best flavour is grown in some of the warmer districts of the eastern Andes. The two indigenous products which receive most attention, perhaps, are those of quinoa and coca. Quinoa is grown in large quantities, and is a staple article of food among the natives. Coca is highly esteemed by the natives, who masticate the leaf, and is also an article of export for medicinal purposes. It is extensively cultivated in the departments of Cochabamba and La Paz, especially in the province of Yungas.
In the exploitation of her forest products, however, are to be found the industries that yield the greatest immediate profit to Bolivia. The most prominent and profitable of these is that of rubber-collecting, which was begun in Bolivia between 1880 and 1890, and which reached a registered annual output of nearly 3500 metric tons just before Bolivia’s best rubber forests were transferred to Brazil in 1903. There still remain extensive areas of forest on the Beni and Madre de Dios in which the rubber-producing Hevea is to be found. Although representing less value in the aggregate, the collecting of cinchona bark is one of the oldest forest industries of Bolivia, which is said still to have large areas of virgin forest to draw upon. The Bolivian product is of the best because of the high percentage of quinine sulphate which it yields. The industry is destructive in method, and the area of cinchona forests is steadily diminishing. Many other Bolivian plants are commercially valuable, and organized industry and trade in them will certainly be profitable.
The industrial activities of the Bolivian people are still of a very primitive character. An act was passed in 1894 authorizing the government to offer premiums and grant advantageous concessions for the development of manufacturing industries, especially in sugar production, but conditions have not been favourable and the results have been disappointing. Spinning and weaving are carried on among the people as a household occupation, and fabrics are made of an exceptionally substantial character. It is not uncommon to see the natives busily twirling their rude spindles as they follow their troops of pack animals over rough mountain roads, and the yarn produced is woven into cloth in their own houses on rough Spanish looms of colonial patterns. Not only is coarse cloth for their own garments made in this manner from the fleece of the llama, but cotton and woollen goods of a serviceable character are manufactured, and still finer fabrics are woven from the wool of the alpaca and vicuña, sometimes mixed with silk or lamb’s wool. The Indian women are expert weavers, and their handiwork often commands high prices. In the Mojos and Chiquitos districts the natives were taught by the Jesuit missionaries to weave an excellent cotton cloth, and the industry still exists. Cashmere, baize, waterproof ponchos of fine wool and silk, and many other fabrics are made by the Indians of the Andean departments. They are skilled in the use of dyes, and the Indian women pride themselves on a large number of finely-woven, brilliantly-coloured petticoats. Tanning and saddlery are carried on by the natives with primitive methods, but with excellent results. They are skilful in the preparation of lap robes and rugs from the skins of the alpaca and vicuña. The home markets are supplied, by native industry, with cigars and cigarettes, soap, candles, hats, gloves, starch, cheese and pottery. Sugar is still made in the old way, and there is a small production of wine and silk in certain districts. No country is better supplied with water power, and electric lighting and electric power plants have been established at La Paz.
Commerce.—The foreign trade of Bolivia is comparatively unimportant, but the statistical returns are incomplete and unsatisfactory; the imports of 1904 aggregated only £1,734,551 in value, and the exports only £1,851,758. The imports consisted of cottons, woollens, live-stock, provisions, hardware and machinery, wines, spirits and clothing. The principal exports were (in 1903) silver and its ores (£636,743), tin and its ores (£1,039,298), copper ores (£157,609), bismuth (£16,354), other minerals (£20,948), rubber (£260,559), coca (£28,907), and cinchona (£9197)—total exports, £2,453,638. These figures, however, do not correctly represent the aggregates of Bolivian trade, as her imports and exports passing through Antofagasta, Arica and Mollendo are to a large extent credited to Chile and Peru. The import trade of Bolivia is restricted by the poverty of the people. The geographical position limits the exports to mineral, forest and some pastoral products, owing to cost of transportation and the tariffs of neighbouring countries.
Government.—The government of Bolivia is a “unitarian” or centralized republic, representative in form, but autocratic in some important particulars. The constitution in force (1908) was adopted on the 28th of October 1880, and is a model in form and profession. The executive branch of the government is presided over by a president and two vice-presidents, who are elected by direct popular vote for a period of four years, and are not eligible for re-election for the next succeeding term. The president is assisted by a cabinet of five ministers of state, viz.: foreign relations and worship; finance and industry; interior and fomento; justice and public instruction; war and colonization. Every executive act must be countersigned by a minister of state, who is held responsible for its character and enforcement, and may be prosecuted before the supreme court for its illegality and effects. The legislative branch is represented by a national congress of two houses—a Senate and Chamber of Deputies. The Senate is composed of 16 members, two from each department, who are elected by direct popular vote for a period of six years, one-third retiring every two years. The Chamber of Deputies is composed of 72 members, who are elected for a period of four years, one-half retiring every two years. In impeachment trials the Chamber prosecutes and the Senate sits as a court, as in the United States. One of the duties of the Chamber is to elect the justices of the supreme court. Congress meets annually and its sessions are for sixty days, which may be extended to ninety days. The chambers have separate and concurrent powers defined by the constitution. The right of suffrage is exercised by all male citizens, twenty-one years of age, or over, if single, and eighteen years, or over, if married, who can read and write, and own real estate or have an income of 200 bolivianos a year, said income not to be compensation for services as a servant. The electoral body is therefore small, and is under the control of a political oligarchy which practically rules the country, no matter which party is in power.
The Bolivian judiciary consists of a national supreme court, eight superior district courts, lower district courts, and juzgados de instrucción for the investigation and preparation of cases. The corregidores and alcaldes also exercise the functions of a justice of the peace in the cantons and rural districts. The supreme court is composed of seven justices elected by the Chamber of Deputies from lists of three names for each seat sent in by the Senate. A justice can be removed only by impeachment proceedings before the Senate.