Colombia would be on the verge of 5.75% growth according to the IMF

Slowly but surely. This has been the economic recovery in Colombia, which by 2021, was one of the most dynamic in the region. The factors have been several. On the one hand, vaccination. Data collected by Our World In Data indicate that today 68.2% of the Colombian population has a complete vaccination schedule. Added to this are two more aspects: the steady consumption of Colombian households and a recovery in investment in exports based mainly on raw materials such as oil whose price per barrel is around 110 dollars.

These aspects make it possible to clarify what growth for the IMF is 5.75% in the Colombian economy, which would therefore contribute to reducing the current account deficit, that is, it would allow balancing the obstacles that meant spending greater than income on international transactions in previous years.

But it's not all rosy. While CEOs congratulated the authorities for the “strong policy frameworks and comprehensive response to the pandemic, which underpinned the resilience of the economy and a strong recovery,” estimates also point out that if on the one hand the economy will grow, inflation will also increase driven by the global crisis that not only knocks on the door of Europe, but permeates the entire world with the war in Ukraine.

In this regard, while the export of hydrocarbons benefits the country, the increase and volatility in food and energy prices will continue to put pressure on consumers' pockets. Other threats also add to this. The uncertainty in the face of a pandemic that does not end in the face of the possibility of a new variant of the virus that could generate lower than expected growth, and the political situation that the country is going through; a phenomenon that regardless of political trends, in recent years has made investors think twice.

The outlook set out earlier by the IMF, although positive in the short term, implies continuing to work to shield itself. To that extent, after highlighting Colombia's timely response to the pandemic and highlighting the set of actions that the Colombian State has taken to integrate the more than 611,000 Venezuelan migrants into its economic system, a call was made to continue protecting economic policies against the obstacles faced by them present.

In this regard, there were several suggestions put forward. Many of them in order to save extra money, since by cutting exceptional support measures and continuing the Law on Social Investment, experts indicate that the fiscal framework can be strengthened. Likewise, it was urged to deepen fiscal reforms that improve spending efficiency and safeguard public investment, social programs in crisis and debt reduction.

Without leaving aside the country's problems, the managers also stressed the importance of thinking about prevention policies for money laundering, one of the most mentioned crimes in Colombia and which in 2021 alone amounted to six billion pesos. He also announced the need to continue fighting corruption and implement reforms that stimulate the country's productivity and competitiveness, following a path where sustainability is the order of the day and is compatible with the Sustainable Development Goals.

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