2023 has been difficult for the World economy and Colombia is no exception. It is estimated that this year its GDP will grow close to 1 percent, according to forecasts by investment banks and the multilateral.
The world’s central banks have significantly raised their interest rates to levels without historical precedents, in order to control the inflation produced in the rises in oil and the shortage of food, fertilizer and food.
(Also read: The new forces that prevent inflation from beginning to subside)
In addition, to this panorama is added the way in which the covid-19 pandemic, the war in Ukraine and commercial and financial sanctions have disrupted world trade flows, the cost of freight and the price of foodespecially the grains.
If measures are not taken to promote and defend economic expansion, the current decisions of the Government could further lower that modest estimated growth potential.
Given this scenario, the former president of Colombia and director of the Liberal Party, César Gaviria, believes that it is crucial to avoid hitting productive activities, trade in goods and services, growth and financial flows.
“If measures are not taken to promote and defend economic expansion, the government’s current decisions could further lower that modest estimated growth potential,” it adds.
In addition, he warns that the Government’s decision not to award new oil contracts will impact economic growth. “It is illogical to believe in stopping exploration in new areas”.
An announcement that came in the midst of a difficult context and is contrary to what Mexico, Venezuela and Brazil —governments related to Colombia— are doing, which are striving to increase their crude production.
“President Petro and his minister (Irene Vélez) must be heroes abroad among radical environmentalists at the cost of the enormous sacrifice that their decisions represent for our citizens,” says Gaviria, who also wonders if it will be worth it. sacrifice emerging oil production.
And he agrees with Felipe Bayón, prominent president of Ecopetrol, when he affirms that, having a robust and solid industry, it will be in charge of generating the resources to finance the energy transition.
For the director of the Liberal Party, Minister Vélez’s misinformation and lack of rigor “are clear and tangible”, and an example of this is her “attempt to base a policy of non-exploration”.
(Also read: Mining strike in Antioquia: 80 percent of the blockades have been lifted)
The president ingeniously believes that with tourism we are going to replace all mining-energy exports
Today, Colombia emits only 0.58 percent of global greenhouse gases (GHGs). “An ambitious program to stop deforestation, plant trees and recover the Amazon would have been enough to meet the modest commitments of Colombia against the commitments of Paris”, considers Gaviria.
And he adds that the current leadership “seeks a world (more papists than the Pope) little understandable, only to seek an unattainable external popularity among extreme environmentalists.”
The former president also mentions that the economies of Brazil, India, China and South Africa criticize the double standards of developed countries, due to the pressure they exert so that the rest ditch fossil fuelswhile they increase their consumption.
Their arguments focus on the fact that, without the support of these large economies, restrictions will not be imposed and this may not be realized in the near horizon. Regarding the case of Colombia, he says that it lacks the wisdom of these countries and has preferred to sacrifice the economy and the well-being of the people, without achieving anything in return.
“The president, ingeniously, believes that with tourism we are going to replace all mining-energy exports. One would suppose that one should look to the future and not to the past, but instead of that, we are going back half a century,” says Gaviria.
mining at risk
The political leader also referred to the mining in the country and said that the Government is unaware that the exploitation of copper —the most important metal for the energy transition— does not put water sources at risk. For this reason, he suggests carrying out “arduous and conscientious investigative work that allows elucidating the benefits of this process and not what they are doing with Quebradona.”
Well, a few weeks ago, during his visit to the municipality of Jericó, in Antioquia, President Gustavo Petro assured that during his government of those mining projects that put water resources at risk. “His idea of it is to protect the smallholding crops that prevail there, creating even more uncertainty in the process of the energy transition of the country and, of course, in the future of the economy”.
(Also read: Colombia unifies networks to transport natural gas: what does it imply?)
It seems that, according to the Government, all legal procedures and instances and community consultations could be violated in order to achieve this purpose.
This situation would also impact Risaralda and Caldas because, according to Gaviria, it is taking place without consultation, without citizen participation, without technical rigor and bypassing all municipal and regional powers.
“It seems that, according to the Government, all legal procedures and instances and community consultations could be violated in order to achieve this purpose that is so harmful to our economy that, in the end, could set us back 50 years,” he says.
Currently, there are projects such as Quebradona, Volador, Mandé Norte, El Carmen, San Matías, Cómita, Pantanos and Mocoa, which are advancing in different procedures and phases to become copper minesbecause the only one that Colombia has today is El Roble, in Chocó.
According to the Colombian Mining Association (ACM), in less than 15 years the gap between the demand and supply of this metal will exceed 5 million tons per year, equivalent to five times the production of the largest mine in the world.
“It is inexplicable that, for ideological reasons, the government forces the country to give up valuable sources of wealth necessary for the energy transition. Electricity is transmitted with copper and it is possible to stand out from the other world markets”, assures the director of the Liberal Party.
In addition, he believes that Minister Irene Vélez “rushed with this unfortunate centralist decision, totally illegal and with an authoritarian whiff. This same baseless decision seeks to end large projects that would benefit society in general, but they are not taking this into account, nor the giants Lawsuits before Colombian and international courts“.
And remember that the principle of common responsibilities embraced by Colombia was adopted in the Rio Declaration at the Earth Summit in 1992. This principle considers that, although all countries have a responsibility to control GHG emissions, it is the countries industrialized countries that must assume the greatest burdens to reduce these emissions and, in this way, not affect emerging economies.
“There is no doubt that It is then a chain of arbitrariness, a chain that as a consequence will cost us hundreds of millions of dollars in investment decisions, or even sanctions by institutions such as the OECD. All of this in an environment of widespread fear and uncertainty,” Gaviria asserts.
effects on the dollar
The former president points out that the devaluation of the peso against the dollar cannot be attributed solely to the international situation. He says that its cause is the growth of country risk —Measured by companies’ fear of investing in Colombia— in view of the announcements of not delivering new contracts for the exploration and production of oil and natural gas; the harassment of investors; changing the rules of the game in infrastructure and public services; and the nationalization of health and other social services.
“It seems that, if the situation continues like this, we will end up facing the radical reduction, even more, the poor expected growth of the national economy. (…) We already know that the minister (Irene Vélez) hates foreign investment“he adds.
Likewise, it states that the suspension of projects will stop the hiring of labor and the payment of large royalties that are paid to all municipalities. “Without a doubt, the Minister of Mines thinks that this discussion is reduced to a philosophical and not an economic context. So would one suppose that we have to prepare for the economy to decrease?
(Also read: In 2023, 9 infrastructure projects will be prioritized for more than $14 trillion)
Call on President Petro to ‘build on what has been built’
The director of the Liberal Party, César Gaviria, assures that the information that has emerged about the financial weakness of the EPS is “very unfortunate and catastrophic”, since the Minister of Health, Carolina Corcho, “is delaying the turns of the Nation and The banks have already closed the credits, precipitating a crisis that is juxtaposed with their anti-growth discourse”.
“I can’t estimate how many jobs will be lost due to delays and the announcements of the closure of the EPS. But of course, we already know that Minister Corcho will say that it is the fault of the health system and its financial practices,” she says.
Be reasonable and analyze what the country needs, target the real needs and, above all, build on what has been built
However, he acknowledges that changes are needed, although those proposed by the minister could lead to people losing their access to the health service, who could not be accepted by the New EPS and will take to the streets “to march against the irresponsible decisions by President Petro and the minister, who shies away with joy when she sees how she manages to break and jeopardize the entire health system“.
Additionally, Gaviria wonders if Petro knows that “if things continue as they are, Colombians will have no one to turn to and, surely, there will be no resources for the leafy and bloated bureaucracy that she (the Health Minister) intends to create before of the October elections.
on labor reformsthe political leader says it could increase unemployment in the country and cause many businesses to close.
He also questions the fact that the Petro government has not signed any PPP (public private association) after seven months of its arrival and that, on the contrary, it wants to suspend this mechanism in the infrastructure sector.
And he described as “blackmail” the changes that the Government wants to make to the Bogotá metro, which would increase costs by up to 17 billion pesos, not counting the 6 more years that an underground section would take.
“If you want, call me a neoliberal —a fashionable insult to refer to opponents of the ideas of the national government— for wanting to save the rights of all Colombians, for wanting to attract investment and for wanting to improve the quality of all our citizens,” says Gaviria.
He asks “to be reasonable and analyze what the country needs, aim at the real needs and, above all, build on what has been built.”
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