Impact of the construction recession on the competitiveness of the Bolivian cement industry

Abstract

This article examines how the recession in Bolivia’s construction sector has affected the competitiveness of the cement industry. According to the INE, in 2024 national GDP grew by just 0.7 % while construction reached 2.7 %, reflecting low public investment, the collapse of Banco Fassil, and shortages of foreign currency and fuel. Over the same period, cement sales totaled 4.1 million tonnes, 77.15 % of which were concentrated in the markets of Santa Cruz, Cochabamba, and La Paz. The entry of new state owned plants and private expansions has gradually reduced market concentration, with the Herfindahl–Hirschman Index showing a decline when comparing 2015, 2019, and 2023—evidence of a more competitive market. The Porter’s Five Forces analysis reveals intense rivalry, high costs, and strong bargaining power among logistics and raw material suppliers, given the sector’s capital intensive nature. Faced with this new scenario, the study concludes that companies must build sustainable advantages by adopting technologies such as Artificial Intelligence, implementing cost reduction strategies, increasing operational agility, and forging close integration with the construction sector in order to maintain their position in an increasingly dynamic market.