Bolivians warned to tighten belts because of oil plunge

President Evo Morales warned Bolivians to start tightening their belts Saturday because plunging oil prices are likely to lead to hard times over the next year.

Bolivia's economy has been growing at a rapid pace over the past two years, thanks in part to natural gas exports to Argentina and Brazil.

"Unfortunately, due to the drop in oil prices, I am sure this year or the next we will have economic problems," he said in a speech at a university in northern Bolivia.

"Our families know how to live in poverty. When there's not much money we sometimes say: 'We have to tighten our belts.'"

Morales, a leftist who nationalized the oil industry in 2006, said he had asked his cabinet to come up with an austerity plan.

At the same time, he said the Andean country was still positioned well to handle a downturn, cushioned by $15 billion in reserves, the greatest in Latin America as a percentage of GDP.