The Ministry of Finance is finalizing details of the draft General Budget of the Nation for 2025 before its presentation to the Congress of the Republic and amid expectations to know how the accounts will be adjusted for next year, New details suggest that investment will now depend on a strong tax squeeze that would be carried out through the Financing Law that has already been announced.
Finally, the accounts at Casa de Nariño, in accordance with the investment plan, stipulate that $81.8 billion will be allocated to this sector of the economy, of which $68.1 billion will be financed with resources from national government sources and $13.7 billion with resources from the national public institutions.
This makes it clear that the budget will exceed the $47 billion initially discussed in the budget talks, although there are warnings about a shortfall of almost 30% of the resources that are projected. According to the Higher Council for Fiscal Policy, which gave its approval to the plan, of the more than $80 billion of investment planned for next year, $21.4 billion is part of a contingent space.
Ministry of Finance and Public Credit
This tax authority indicated that “in its session of July 13, 2024, based In accordance with the provisions of Article 26 of Decree 111 of 1996 (Organic Budget Statute), and Article 2.8.1.3.5 of Decree 1068 of 2015, evaluated and issued a favorable prior opinion on the fiscal implications” of the investment plan, which for them is consistent with the Medium-Term Expenditure Framework.
There’s no money
In concrete terms, at this moment the country does not have much of the money for the planned investment and its execution will depend on the approval of the Financing Law. This also sheds light on the magnitude of the revenue that the Ministry of Finance hopes to achieve, which for now is clear that it will be higher than the 2022 tax reform, which was $20 billion.
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For several analysts consulted by Portafolio, reviewing the documents According to this media outlet, it is striking that the Government is linking the budget discussion and the importance of investment resources to a financing law, since this generates undue pressure on the decisions that will begin to be made this week, in the midst of the tense atmosphere caused by the recent Risk Management scandal.
Furthermore, taking stock of the past tax reform, they recalled that only $10 billion of the $20 billion initially planned were received, something that also casts doubt on the possibility of achieving the $24 billion projected in the Investment Plan. The collection goal projected for now is 120% of that proposed in the reform of the Ocampo era.
Petro Government Investment Plan 2025.
Investment priorities
On the other hand, reviewing the details of the investment projected in the 2025 Investment Plan, the sectors with the highest allocations are Transportation ($13.4 billion), Equality and Equity ($9.5 billion), Education ($8 billion), Social Inclusion ($7.4 billion) and Mines and Energy ($7.2 billion); while the lowest were in the Intelligence sector ($30.00 million), Foreign Relations ($193.000 million), Congress ($200.000 million) and Science and Technology ($267.000 million).
“To achieve regional convergence, the National Government, “On the one hand, it improves the infrastructure and road network of the territories, through the construction, improvement and maintenance of regional roads and ancestral paths. On the other hand, it develops multimodal transport, based on the construction of railways and airports, together with the improvement of the primary road network,” says the text.
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This plan also makes clear the intention to “consolidate inclusive and sustainable tourism, through actions to encourage it and increase occupancy. In addition, it reduces social and economic gaps in households, through the improvement of habitat conditions throughout the national territory, especially in territories that have been until now marginalized from economic development and social progress.”
Primary road network
Reviewing this plan, but by programs, the Government stipulated that the attention to “Primary road network infrastructure” will have the highest allocation ($8.9 billion); followed by “Comprehensive development of early childhood to youth, and strengthening of the capacities of families of girls, boys and adolescents” ($8.5 billion), “Productive consolidation of the energy sector” ($5.2 billion) and the strengthening of Higher education and job training, each at $4.8 trillion, will be his priority.
Petro Government Investment Plan 2025.
According to the Ministry of Finance, the amount of investments presented below corresponds to the fiscal spaces, which are given in accordance with the behavior of the macroeconomic situation, which is why they are confident of being able to comply with each of them and ensure the economic development of the country, in these times of slowdown.
“Specifically, it is estimated that, in addition to the $81.8 billion forecast in the 2025 investment PGN, there are operating resources from the PGN with transfers for investment worth $151.5 billion, in the General Participation System, worth $81.8 billion ($74.7 billion for investment, $3.3 billion for savings and $3.8 billion in operation),” they explained.
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Finally, with regard to the General Royalties System, projections point to an allocation of $11.6 billion for the term and $58.1 billion of own resources of territorial entities.
With this first account of the investment budget for next year, although the National Government ruled out that it would be one of the lowest in recent history, the fact that it depends on an eventual approval of the Financing Law that will be taken to Congress, raises doubts among experts, who warn that It will certainly lead to new speculation and more uncertainties in the local economy.
