Bolivian President Rodrigo Paz has removed Economic Minister Jose Gabriel Espinoza from his post after the minister was censured by the country’s Congress.

The cabinet shake-up is likely to be perceived as a concession by Paz, who has faced public anger about the country’s ongoing cost-of-living crisis.

The announcement came in a decree published on Friday in the government’s official gazette.

It names Oscar Mario Justiniano Pinto as interim economy minister and explains he will serve in the role until a permanent candidate is appointed. The decree does not, however, offer a prospective timeline for the eventual replacement.

The decision to fire Espinoza, however, marks a reversal for the Paz government.

On Tuesday, the Bolivian Congress voted to censure Espinoza, after he failed to appear before the legislature to answer questions about the economy. Under the country’s constitution, a censure tees up a subsequent dismissal.

The right-wing Paz administration initially said it would fight that decision as a tribunal reviewed the dispute. But Friday’s decree suggests the president changed course.

Bolivia has been roiled by economic and political turmoil for years. Paz, a senator at the time, was elected last October after pledging to bring stability back to the South American nation.

His inauguration the following month marked an end to nearly two decades of governance by the Movement Toward Socialism (MAS). Paz, by contrast, ran on a campaign of “capitalism for all”.

His victory was fuelled by concerns about Bolivia’s economic conditions. Once a major exporter of fuel, the country had seen a decline in its natural gas production, with mismanagement, depleted reserves and a lack of new exploration cited among the reasons.

With a shortfall in outside revenue, Bolivia also suffered a decline in its reserves of foreign currency, leading to further instability.

But Paz has struggled to address Bolivia’s ailing economy while balancing domestic needs. As of 2024, more than 37 percent of the population fell below the national poverty line.

Last December, Paz’s government nixed longstanding fuel subsidies, prompting protest.

A land reform policy signed in April likewise spurred an outburst of public unrest, with rural and Indigenous voters fearing it would weaken protections for small-property owners.

Paz ultimately reversed course on the policy the following month, but throughout much of May and June, the country was gripped by roadblocks, marches and other public demonstrations, with some protesters calling for Paz’s resignation.

The president declared a state of emergency in June, and the country’s Congress approved the use of the military to clear the blockages.

The decision to fire Espinoza comes at a key juncture for the Paz administration.

Paz is currently seeking congressional support for a series of economic reforms, along with a financing programme from the International Monetary Fund (IMF).

News of Espinoza’s departure was greeted as a sign of cooperation with Congress. Through the decision, Paz was “showing a measure of humility and complying with the Constitution”, according to opposition lawmaker Roland Pacheco.

But Paz’s government continues to face domestic backlash. Supporters of former President Evo Morales continue to oppose the new administration, and the left-wing leader continues to play an outsized role in the country’s politics.

Morales has encouraged resistance to Paz’s austerity measures. A court in Bolivia issued an arrest warrant for the ex-leader in July, accusing him of encouraging his supporters to take part in an “armed uprising” in June. He also faces a separate warrant for statutory rape.

In a social media post, Morales accused the government of persecuting him “to conceal the true drama Bolivia is experiencing: a deep economic and social crisis … a model that has abandoned the people and protects corruption”.