The United States and Bolivia have formalised a $20 million agreement aimed at disrupting the flow of cocaine from the Andean nation, a deal that signals a cautious restoration of bilateral co-operation on a long-standing security concern. The pact, signed in La Paz on Tuesday, commits funds for intelligence sharing, crop eradication, and alternative development programmes.
Bolivia remains the third-largest producer of coca leaf globally, after Colombia and Peru, and has struggled for decades to reconcile its indigenous traditions of coca chewing with international anti-narcotics pressure. The country’s shift to the left under President Luis Arce, a former economy minister in Evo Morales’s administration, initially raised doubts about Washington’s willingness to engage. However, the new agreement underscores a pragmatic turn: both governments acknowledge that the drug trade fuels organised crime, erodes state institutions, and destabilises the region.
The $20 million package, administered by the US State Department’s Bureau of International Narcotics and Law Enforcement Affairs, will finance the construction of a police intelligence centre in the tropical Chapare region, a stronghold of coca cultivation and cocaine processing. Local farmers there have long resisted eradication efforts, sometimes violently. The deal also provides for the deployment of additional US-trained Bolivian police units to monitor illegal airstrips and river routes used by traffickers.
Critics within Bolivia’s coca growers’ unions have denounced the pact as an infringement on sovereignty, echoing past objections that US-backed eradication programmes criminalise impoverished farmers without addressing demand in consumer nations. Yet the Arce administration has framed the co-operation as a practical necessity. Bolivia’s interior minister, Eduardo del Castillo, stated that the funds would “strengthen Bolivian institutions without foreign interference in our internal affairs.”
Analysts note that the agreement reflects a broader recalibration of US policy in South America, where the Biden administration has sought to move beyond the confrontational tone of previous decades. The shift is particularly notable in Bolivia, where diplomatic relations have oscillated since the US expelled Morales’s ambassador in 2013 over spying allegations. Full ambassadorial exchanges were restored only last year.
For Washington, the pact provides a foothold in a region where China’s economic influence has grown rapidly. The US has pledged $200 million in development assistance to Bolivia since 2020, part of an effort to counterbalance Chinese lending and investment. The narcotics agreement, though modest in scale, signals American commitment to addressing a problem that generates billions of dollars for transnational criminal networks and contributes to violence across the Americas.
The immediate challenge for both sides will be implementation. Bolivia has made incremental progress: official coca cultivation fell by 5 per cent last year, according to UN data, though cocaine production volumes remained steady due to advances in processing efficiency. The new intelligence hub aims to improve interdiction rates, but success will depend on the willingness of local police to operate in areas where traffickers wield significant influence and resources.
There is also the question of sustainability. Previous US-funded programmes in Colombia and Peru have yielded mixed results, often leading to displacement rather than elimination of coca crops. Bolivia’s own history of alternative development has been hampered by weak state capacity and corruption. The pact includes mechanisms for monitoring fund use, but oversight remains a concern.
Nevertheless, the signing represents a rare instance of co-operation between two governments that have often been at odds. For the US, it is a tactical investment in regional stability. For Bolivia, it is a bet that institutional strengthening can stem a trade that has long trapped the country in a cycle of violence and illicit capital. The returns on that wager will take years to assess.
