Bolivia says goodbye to the AFPs and moves towards a state pension system

(EFE) – The Bolivian Government began the transition to its new state pension system with the announcement of the activities of the Public Manager, a nationalization process that had been announced twelve years ago, and that this Friday started with the registration of new contributors.

The president of Bolivia, louis arcetogether with the Minister of Economy, Marcelo Montenegro, made official the partial start of the activities of the Public Manager in the administration of the Contributory and Semi-contributory Regimes of the Comprehensive Pension System, which will be the only body in the country for this item.

Arce described this advance as “historic” in which Bolivians will no longer have to register with a private Pension Fund Administrator (AFP), but rather with the Public Administrator that is in charge of the Bolivian State.

“Today we are advancing in the line that our pensions gradually, gradually, be administered by ourselves, the Bolivians, as it should always be”said Arce.

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The president indicated that since this Friday will begin with the registration of all new contributors to this pension fund to which all Bolivians who contribute must join.

The Public Manager is expected to complete the migration process of all the information of the contributions registered in the private AFPS, such as AFP Futuro de Bolivia and Previsión, until May 2023 when it begins to fully operate, despite the fact that this entity already It is seven years old.

“In Latin America today there are questions to the AFPS about what we had already advanced, therefore, we should feel proud of being the pioneers in pension administration,” said Arce.

For its part, Montenegro explained that the Public Manager will focus on “the welfare of the retired worker” and that the profits of this entity will be used to finance the solidarity fund and the dignity income, a monthly subsidy that benefits people over 60 years of age.

The insured will no longer have to pay different commissions, but only one and that institution will have some 31 offices with the aim of giving a “personalized attention”Montenegrin said.

Bolivian pension funds are currently administered by the AFP Future of Bolivia y forecastthe latter subsidiary of the Spanish BBVA, until the process of nationalizing the retirement system is completed.

The government of the then president Evo Morales approved in 2015 the decree of constitution of the public pension manager and in September 2017 it issued another rule that postponed the start of its operations until March 2019.

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Precisely in 2019, the Bolivian government decided to postpone until 2021 the start of the state pension administration because the software was not completed.

The Public Manager was created on January 14, 2015 under a law enacted in 2010.

In July of this year, the International Center for Settlement of Investment Disputes (ICSID) issued an arbitration award that obliges Bolivia to compensate BBVA with 105 million dollars for the “unjustified delay” in the process of nationalizing the pension system.

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