Colombian President Iván Duque in mid-November completed his first 100 days leading the South American country. In a speech he shared on Twitter, Duque highlighted the administration’s main challenges, citing “equity” among Colombians as his government’s main objective. Has Duque gotten off to a good start as president? Which issues has he prioritized in his first 100 days in office, and which goals will he focus on in the coming year? How have markets and investors reacted to Colombia’s new president and his economic policies?
Gimena Sánchez-Garzoli, director for the Andes at the Washington Office on Latin America: “President Iván Duque’s first 100 days in office have been tumultuous, and his popularity has plummeted. The problems that he must address are structural ones that any president would need to address—closing the fiscal deficit, advancing with peace in a polarized political environment and dealing with the influx of one million Venezuelans. Part of his lack of popularity comes from incoherence within his administration on policy issues, with ministers, the president and members of the Democratic Center Party presenting policies differently. Former President Uribe and others from the Democratic Center are continuously making statements that give the sense that Duque is not fully in control of the agenda. Duque is under great pressure to address budget gaps and to improve the economy. During his campaign, he criticized the Santos administration for attempting to raise the VAT. Now as president, he is seeking to do exactly that. This, along with cuts including to public education, are being met with social protests. The protests are likely to grow and expand to more parts of Colombia. On corruption, he has not advanced as promised. Nor has he cut the ‘peace accord into pieces’ as he had promised during his campaign. On peace, since taking office, his administration has realized that implementation of the accord was much further along than it realized and that the international community does not want Colombia to take steps backwards on the agreement. Duque must show stronger leadership and rein in or distance himself from the voices that undermine him within his own party in order to build confidence in his ability to govern. Lastly, the Venezuelan migration crisis is placing an undue burden on Colombia. Duque has taken a humane approach to the problem and has sought international support to address it as best as possible.”
James Watson, economist for Latin America at Oxford Economics: “When Duque was elected in June, we expected his riskiest promises to moderate after he took office. We also suspected that in Colombia’s first divided Congress there would not be enough political will to pass serious economic reform. Duque’s first 100 days have borne out these expectations as lawmakers have staunchly resisted a more moderate policy agenda. Economically, Duque’s first budget was an impressive attempt to balance multiple objectives. It cut corporate taxes for competitiveness, broadened VAT to raise revenues and increased the top rate of income tax to address distributional concerns. However, popular opposition to the regressive VAT reform has killed the measure, and we expect next year’s fiscal balance to underperform targets by 0.2 percent of GDP. Still, not all economic policy is log-jammed, as by year-end authorities expect to have found funding for more than half of the ambitious 4G infrastructure program. Despite inaction due to legislative gridlock, markets have largely given Duque a pass, which we expect to continue. Sovereign spreads rose after the budget hit difficulties, but they remain contained. Equities have been resilient despite falling oil prices, and ratings agencies have been reticent. Looking ahead, we expect Duque to continue his balancing act between fiscal hawkishness and boosting investment. Vital for this will be a better ability to work with Congress and to connect with public opinion. We remain hopeful, but nothing is certain with a former president holding the keys to Congress and thousands of protesters on the streets.”
Oliver Kaplan, associate professor at the Josef Korbel School of International Studies at the University of Denver and director of the Korbel Latin America Center: “Duque’s popularity rating has sunk from 54 to 27 percent. Yet, Duque himself recently asserted to have ‘put the house in order,’ pointing to declining crime rates. Although Duque leans conservative, he has perhaps been more moderate than both the political right and left expected. Take his appointments. Although he has received flack for controversial moves, he has also appointed experienced technocrats. He has also supported Venezuelan migrant ‘brothers and sisters’ with health and education services. Duque’s thin margin in Congress may continue to pull him toward the center. Duque has also supported peace thus far, despite having campaigned on ‘tearing up’ the FARC agreement. He is seeking to fill budget gaps to fully fund the implementation framework he inherited from the Santos administration. And while he put the ELN talks on hold, he proposes to reopen negotiations with his own team if the ELN halts its offensives. Duque’s most publicized challenge has been the continued killings of social leaders and human rights defenders. His campaign at times stigmatized political rivals. But, to Duque’s credit, he met with community leaders in Apartadó in August, and seems to have listened. He announced a protection plan that promises improved inter-agency coordination and threat analysis and stronger punishments for attackers. Duque should continue to support the internationally endorsed peace agreement. Sustaining peace will also require confronting the remaining armed actors—the ELN, criminal bands and ‘residual’ FARC groups—and addressing exploding coca cultivation. Relatedly, his protection plan should directly involve members of the very social groups that are threatened. Duque has also cast himself as a good-governance reformer, and improving governance will be key as oil prices remain low and the country faces a budget deficit and protests for more education funding. Acting on this issue is ever more salient in the wake of the Odebrecht scandal and August’s failed anti-corruption referendum. Is Duque following his political mentor, Álvaro Uribe, as opponents have claimed, or will he actually trend more centrist, like his immediate predecessor Santos? Since Duque has not yet faced the test of immediate crises, only time will tell.”
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