Threat of a shutdown and doing business in Bolivia.

These have been a busy two weeks with visitors, guests, Amanda taking a long weekend, and news that a “competitor” in town reported us to the authorities for not having presented all our papers yet and “robbing” them of their business. Officials from the Mayor’s Office of Tourism as well as the Chamber of Hospitality/Accommodations/etc. (translation?) paid us a visit and told us we had two weeks to present all of our papers and pass all inspections or else we would be fined, closed down, and forced to bring down our website(s). Already, this sounded serious, but absurd. After all, in the case of the latter, for example, no one can really control what goes on the internet or not…But still, as for the other things: serious stuff, especially because those “clausurado” stickers are quite difficult to get off the doors!

The biggest worry was the fact that the concept of a hostel is actually quite new to Sucre, meaning that there is no existing typology for them. There are categories of control for hotels and large-scale party hostels and so on, but the closest that The Beehive comes to is falling under the existing category of “Guest House.” The minimum number of bedrooms for a typical “hostel” (which really just means a medium- to high-end hotel here in many cases)? Ten. For a “guest house”? Six. How many do we have? Four. Hence, panic.

Whatever else we could scramble up in two weeks to meet the other requirements would not change the fact that we are two bedrooms short of approval. But it’s not just that we do not fit into the regular categories of “business” or “non-profit/civic association” and get taxed as a business would when we put money from the hostel towards our programs and other services; it’s now that we also do not fit into the already existing typologies for accommodations! When more advanced cities still have difficulties updating their antiquated and inflexible models for categorizing new enterprises, one cannot be surprised that we are still behind here. So begins the Bolivian bureaucratic nightmare…and the possibility of getting shut down in two weeks.

For those who do not already know this about Bolivia, according to the World Bank’s Annual “Doing Business” Report (, out of the 185 countries surveyed, Bolivia has a mere 11 countries behind it which are even more difficult to do business in. In other words, it’s really difficult to start a business and do business in Bolivia, because of such things as the fact that it takes more than double the number of steps to start a business in Bolivia than it does in neighboring Chile. Yay! Fun fact of the day. This is, of course, why the vast majority of businesses in Bolivia do not register their businesses and put in their paperwork at the beginning, especially since once you’ve gone out of business, you have to pay another fee to let the Fund de Empresa know that you’ve gone under. Talk about kicking a dog while it’s down, no? The restaurant on the corner has changed hands at least 6 times since December. That means each new renter has been open for a mere 1.2 months generally before realizing that their offerings of fried chicken and silpacho weren’t going to keep them afloat. This also means that there is really no incentive to register a business when it already costs you about 3/4 of your average income in Bolivia to start it and you can’t be sure if it’ll ever provide you a return of any kind or not. As the process is long and arduous, consuming time, money, and patience, very few micro-to-medium-sized businesses here will have their papers or provide receipts for tax purposes. This means there’s a whole lot of chasing ghosts around town, closing down stores and restaurants, and so on. A couple months ago, there was almost nowhere to go for dinner because the tax inspectors for the Restaurant category had shut everyone down. In the end, we live in a financially-strapped country with an inscrutable process with few incentives to do anything the “right way.”  Despite inconsistent ongoing regulation and little assistance for those who wish to follow the rules, there’s surprisingly a whole lot of draconian punishments for not doing so.

Anyhow, faced with this seemingly insurmountable situation, we spoke with the owner about renting another part room connected to our house. During our discussion, the owner of the house told us to visit a relation of hers to explain our case and he turned out to be the exact man, the Director of Tourism, to whom we needed to present all our papers. Fate! We met with our lawyer to discuss drawing up our constitution and then met with the Director to discuss what we could do, if anything. He was very much in support of our project and said that we could count on his help. Some exceptions could be made because, after all, they do not exist to create obstacles for innovative and emerging projects, he said. Rather, their office exists to help facilitate the local economic development of Sucre and to support projects that will help to achieve that end. He especially loved the idea of the workshops as a cultural exchange and said that though it may start out small, who knows what kinds of intercultural channels of  ideas and commerce could emerge from The Beehive in the future. Fantastic news! We have another Beehive believer on our side!

This has been a slow season here in Sucre this year and many of the hostels in town have been basically empty. Not that we have been totally full, but we were perhaps more occupied than the other places in town. In the end, the “competition” had total right to denounce us and the papers do need to get finished. Having to run things with just two of us and with Julia’s health diminishing as well has been very difficult. But despite this, we continue to be  in good spirits. Our guests Eric and Simo as well as one of our volunteers, Laura, spearheaded an afternoon BBQ in the backyard just in time to say goodbye to our longtime guest, Elaine. She got us a beautiful cake and goodbye gifts. It was the beginning of the end of another chapter and a little bittersweet! It was all a big hit, though they were probably not totally prepared to cook for 22 people when they first suggested the idea! Luckily everything came out splendidly and all the extra money was given to help a local boy in dire need of surgery in La Paz.

2013-08-22 00.48.30            2013-08-22 01.22.452013-08-22 01.20.27


Thanks again for tuning in and feel free to leave your comments or suggestions with us should you feel the desire to!

The Beehive Staff

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