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COUNTRY INSIGHTS

Duque’s epiphany
COLOMBIA · Report · 06 Dec 2019

The fate of the government’s tax reform proposal was, up until the beginning of the last week of November, a big unknown. It seems however, the worst part is over. During an infrastructure congress in Cartagena on November 21st, Finance Minister Alberto Carrasquilla spoke optimistically about...

A Lone Ranger, no silver bullets
COLOMBIA · Report · 26 Nov 2019

In the last two months, the Colombian government has lost every single political contest: it declined dramatically in the polls, where president Duque’s favorability is going steadily south; then it was defeated in the regional elections, where Uribe’s party lost its key strongholds; then in the ...

Manufacturing a political crisis
COLOMBIA · Report · 12 Nov 2019 · 1 response

By Latin American standards, Colombia was doing well, led by a pro-market, pro-business leader, who, despite his lack of experience in everyday domestic politics, was known for trying to avoid confrontation and distancing his administration from pork-barrel politics; who intended forcefully to be...

Davids beat the Goliaths
COLOMBIA · Report · 01 Nov 2019

Many an analyst is puzzled that the Central Bank has been holding interest rates constant, while its regional counterparts have started cutting. And the fact that the Bank’s next move next year might be a hike is considered by some to add insult to injury. But we don’t see a puzzle: Colombia is i...

Constitutional Court scraps the 2018 tax reform, but gives the Government a way out
COLOMBIA · In Brief · 16 Oct 2019

The Constitutional Court scrapped the 2018 Financing Law in its entirety, as far as we know a first in an already long and well-known history of Colombian tax reforms. The Court’s ruling, the result of a 6-3 vote, considered the bill approved by the Senate was not given adequate publicity prior t...

The usefulness of the rule
COLOMBIA · Report · 01 Oct 2019

The 2011 fiscal rule gave the central government’s fiscal policy a much-needed countercyclical orientation, as it focuses on differentiating structural from temporary revenues and spending. A critical anchor for policy discussions, it makes a committee of external advisors (the CCRF) responsible ...

Two appointments that come as wonderful news
COLOMBIA · In Brief · 10 Sep 2019

Juan Pablo Zárate steps down from the board of the Central Bank and returns to his old post as Deputy Finance Minister. Undoubtedly one of the most influential members of the board during his 10-year tenure, Mr. Zárate becomes Minister Carrasquilla’s wingman in the midst of a closely-monitored an...

Uribe vs. the Supreme Court, FARC 2.0 & growth
COLOMBIA · Report · 02 Sep 2019

At the Supreme Court a case against ex-president Álvaro Uribe for witness tampering is filled with intrigue, secret tapes, betrayal and revanche. To add insult to injury, the Supreme Court was found to have wiretapped Uribe. This is likely to be a political trial, in which whatever the Supreme Co...

The 2020 Budget: Key questions linger
COLOMBIA · Report · 31 Jul 2019

On July 30, Minister Carrasquilla went through the usual ritual of submitting next year’s budget to Congress and discussing the main features of the bill with the press. The latter is meant to clarify important aspects of an initiative that, while central to fiscal policy, is full of fine print t...

Having our cake and eating it too?
COLOMBIA · Report · 31 Jul 2019

This year may mark the end of stagnation in financial deepening. Outstanding commercial loans in May finally started growing faster than nominal GDP growth. Still, it’ll be a few years before commercial credit-to-GDP ratios rebound to 2015 levels. Will this be enough to take the economy to health...

High unemployment: don’t blame the Venezuelans
COLOMBIA · Report · 23 Jul 2019

What started as a minor concern likely to correct itself has now become one of the greatest sources of concern, for the government and analysts alike. But the government seems to be ignoring the real problems plaguing the labor market, and therefore the solutions it will propose probably won’t be...

A dismal legislature
COLOMBIA · Report · 02 Jul 2019

A new political battleground has emerged, due to President Iván Duque’s plan to resume aerial spreading of the herbicide glyphosate over coca plantations. The peace agreement signed with the FARC mandated manual eradication -- quite a controversial issue, as those coca-growing regions typically l...

No-go to mandatory reduction in banking fees... for now
COLOMBIA · In Brief · 18 Jun 2019

Barely two days before Congress goes to a 1-month-recess, a bill aimed at reducing banking fees, which had already been approved in the House of Representatives, had a crucial vote on June 18 in the economics committee of the Senate (Comisión Tercera). This bill was a major concern for banks, whi...

Just run the executive branch, Mr. President
COLOMBIA · Report · 02 Jun 2019

As in many sports, governments dedicate their energies not only to scoring goals, but to stopping opponents’ attacks.Until May, when President Iván Duque at last began building a congressional coalition, his administration had not followed this principle. Duque lacked a working coalition to help ...

Duque, the Freshman
COLOMBIA · Report · 03 May 2019

The corruption scandals surrounding Ruta del Sol II have created all sorts of problems for the unrelated fourth generation (4G) program. The most important was the realization that, when nullifying a contract due to a concessionaire’s proven corruption, the rules applicable to companies providing...

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