Military Plane Crash in Bolivia Kills 22 as Crowds Loot Scattered Banknotes
A C-130 Hercules carrying 18 tons of unissued currency veered off the runway in El Alto, triggering a chaotic scramble for cash amid economic turmoil.
At least 22 people died when a Bolivian Air Force cargo plane transporting newly printed banknotes crashed onto a highway near La Paz on Friday, scattering currency across the wreckage and prompting police to deploy tear gas against looters.
The death toll rose to 22 on Saturday from the crash of the military plane carrying 18 tons of new banknotes, damaging about a dozen vehicles, according to Mercury News. Another 29 people were injured, mostly passengers traveling on public transportation where the plane crashed. Among the dead are 12 men, including one crew member, six women and four children, according to police commander Mirko Sokol.
Chaos at the Crash Site
The military plane was attempting to land on Friday evening at El Alto International Airport when it skidded off the runway and ploughed into a nearby road, according to Al Jazeera. Witnesses reported that “a heavy hailstorm” was falling and “there was lightning” when the plane went down, with the crash occurring around 6:20 p.m. local time in what officials described as bad weather.
Some people appeared to collect banknotes scattered among debris from the aircraft, the wrecked vehicles and the bodies of victims. More than 500 soldiers and 100 police officers tried to disperse them, according to ABC News. Authorities used water hoses and tear gas to push back onlookers and looters, while the La Paz Prosecutor’s Office received reports of looting of businesses by criminals who took advantage of the chaos in the streets.
Worthless Currency Burned at Scene
Bolivian authorities are scrambling to destroy the equivalent of $62 million worth of local currency bank notes that fell from the sky in the deadly plane crash, according to Bloomberg. The Ministry of Defence, in a statement, said that “the money transported in the crashed aircraft has no official serial number… therefore it has no legal or purchasing power”. The ministry also warned that the “collection, possession, or use” of the money “constitutes a crime”.
To avoid more looting, police and military personnel burned the cash boxes in the presence of Central Bank President David Espinoza, who said the bills “have no legal value because they never entered circulation”. Espinoza did not specify the amount of money being transported, but he said the banknotes had arrived in Santa Cruz from abroad.
Twelve people have been arrested for questioning, according to prosecutor Luis Carlos Torres.
The C-130 Hercules, manufactured by Lockheed Martin in 1977 and operated as FAB-81 by the Bolivian Air Force, was transporting newly printed banknotes from Santa Cruz to La Paz on behalf of the Central Bank. El Alto International Airport sits at 13,325 feet elevation, making it the highest international airport in the world. The extreme altitude complicates landing procedures, particularly in adverse weather conditions.
Economic Crisis Backdrop
The crash occurred against the backdrop of Bolivia’s severe economic turmoil under the newly inaugurated government of President Rodrigo Paz, who took office in November 2025 after ending two decades of leftist rule. Bolivia faces a severe dollar shortage, declining revenue from fossil fuels, and a widening fiscal deficit, with long queues at gas stations and mounting worries about economic stability becoming everyday realities for Bolivians, according to Economics Observatory.
Bolivia’s Central Bank had about $15 billion in international reserves some ten years ago; it is down to $2 billion, according to the Wilson Center. Severe dollar shortages that began in early 2023 have made currency conversion increasingly difficult in practice, according to the U.S. State Department.
The transportation of large quantities of cash by military aircraft underscores the country’s banking system dysfunction. Dollar shortages have become so severe that a banking “corralito” has taken hold: Depositors are unable to withdraw dollars from their accounts and are instead given bolivianos at the official rate, according to Americas Quarterly.
| Indicator | Peak (2014) | Current (2025) |
|---|---|---|
| Foreign reserves | $15 billion | $2 billion |
| Gas export revenue | $5.5 billion/year | $1.6 billion/year |
| Official exchange rate | 6.96 BOB/USD | 6.96 BOB/USD (fixed) |
| Black market rate | N/A | 14 BOB/USD |
Political Transition and Reform Pressure
Rodrigo Paz won with 55.0% of the vote in October 2025, marking the first time in Bolivian history that the presidency changed hands through a runoff election and ending two decades of MAS dominance, according to Wikipedia. Newly-elected President Paz issued a decree on December 17 eliminating fuel subsidies, which have been in place for over two decades, as part of an economic overhaul aimed at shoring up public finances, according to the International Crisis Group.
The decree immediately sparked protests. Fuel prices soared, prompting transport unions to threaten strike action, leading public transport workers to launch a strike on December 19, which caused major disruptions in cities like La Paz and El Alto.
The Paz administration announced in late November 2025 that it would engage the Bolivian congress to reduce government spending by 30% in 2026 and eliminate some taxes, according to a Congressional Research Service report. However, the scale of reforms required to stabilize the economy remains politically fraught.
- The crash killed 22 people and injured 29, with victims including civilians in vehicles struck by the aircraft as it veered off the runway in severe weather.
- Police arrested 12 people and deployed tear gas against crowds attempting to collect scattered banknotes, despite government warnings that the unissued currency has no legal value.
- The crash highlights Bolivia’s deteriorating financial infrastructure amid a currency crisis that has depleted foreign reserves from $15 billion in 2014 to $2 billion today.
- President Paz’s December elimination of decades-old fuel subsidies has already triggered strikes and protests, complicating his reform agenda.
What to Watch
The crash investigation will determine whether extreme altitude, adverse weather, or mechanical failure caused the C-130 to veer off the runway. Two of the six crew members were still unaccounted for by late Friday, and forensic teams continue recovering remains.
Broader questions loom over Bolivia’s economic trajectory. The Paz government faces competing pressures: international creditors demand fiscal consolidation, while labor unions and civil society groups oppose austerity measures. The next president will have to implement painful reforms, including reducing a fiscal deficit that has hovered around 10% for years, possibly tripling domestic fuel prices, and negotiating with international lenders such as the International Monetary Fund.
The looting scenes underscore public desperation in a country where the parallel market exchange rate trades at double the official rate, eroding savings and purchasing power. Whether Paz can navigate the political minefield of economic reform while maintaining social stability will determine not just his presidency, but Bolivia’s trajectory through the remainder of the decade. The macabre scramble for worthless banknotes at a crash site may prove a fitting metaphor for an economy where even official currency has lost credibility.