When talking about the growth engines of the economy in 2025, one of the most highlights is consumption, a point where the Gustavo Petro Government takes chest, saying that it is thanks to factors such as the increase in the minimum wage. However, for experts This is half truth, since several actors of the economy are being unknown.
Munir Jalil, chief economist for the Andean region of BTG Pactual, argues that this sector would be moving more for external dynamics than by achievements at the local level, and that indicators such as credit are proof of that. Likewise, it emphasizes that the fiscal crisis has passed a expensive invoice to GDP behavior.
See here: LUIS Carlos Sarmiento Angulo received order to the business merit of the Andi
How did the GDP of the second quarter see?
The GDP data was 2.1%. We were waiting 2.3% and with that, for the market and for many analysts it was disappointing. However, we continue to see the same panorama and that is why we have not changed our prognosis of the year, which is 2.5%, with a consumption that looks still quite dynamic and an investment that remains quite late and remained.
What is your balance of the first semester?
The Colombian economy shows two different facets, but equally relevant. In aggregate terms, a recovery is observed after the weak performance of 2023, when it grew 0.7%. Last year he rebounded slightly, exceeding 1.7%, and is now above 2%.
However, that growth is unequal and by analyzing the different economic sectors, most have a recovery with a rhythm close to their historical average. If we tried to identify sectors that are really marking the economy, we would find few cases, because in general the advance is limited to average growth.
The projections suggested that this indicator would be higher than it was finally seen.
Chatgpt image
Does the economy recover slow?
Clear. In this century Colombia has lived at least three clear episodes of fall. The first, associated with the financial crisis of 2008-2009; the second, to the sharp fall in oil prices in 2016-2017; and the third, the pandemic in 2020.
In those three cases, after important falls, the recovery was rapid, because Typically Colombia has become accustomed to growing from one year to another after a crisis. However, after the contraction of 2023, that pattern has not been repeated and three years are already in a recovery process, and when not being realized in a single year, it is clear that something is different. Many sectors grow, yes, but they do it with difficulty, trying to get ahead with their nails.
It may interest you: GDP of the second quarter was below expected: 2.1% per year
Is there inertia reactivation?
I would say that there is a reactivation, but it is also true that much is explained by inertia. That is, we are facing a slow recovery process, promoted more by the economic cycle and the natural dynamics of the economy than by concrete measures. What was pending after the fall was, at least from the government, a clear recovery plan that would seek to propel the productive sectors determined.
Consumption would be the protagonist of GDP growth.
Chatgpt image
Do consumption pushes the economy?
That is another interesting things. When we look at the growth from demand, that is, consumption, investment and expenditure of the government, we find that the engine that sustains Colombian economic growth is consumption, especially that of households.
Within the consumption of households, the strongest impulse comes from durable goods, such as vehicles and motorcycles, and the semi -durable, as appliances. This positive dynamic is maintained practically since last year and has been key to sustaining economic activity.
More information: YouTube begins to implement new age verification system with AI
There is an internal impulse …
When analyzing what is financing that consumption, in a “normal” recovery we would expect credit to accompany this behavior. However, in Colombia it is not because consumption grows, but without the support of a parallel increase in credit, which raises questions about its sustainability over time.
Today, the factors that promote certain income flows are exogenous, that is, they come from abroad. Among them are international remittances and coffee bonanza, which benefits some 3,000 families thanks to good coffee prices. These greater income allow them to spend more and boost the local economy.
The projections suggested that this indicator would be higher than it was finally seen.
Chatgpt image
Drug trafficking?
There is also a bonanza linked to illicit products. The increase in cocaine production, although problematic, generates additional income. Colombia does not completely control these income, but it is the main producer, so part of these resources ends up circulating in the economy.
In practice, we are the “factory” of these products, and although their origin is illicit, the resources they generate end up permeating different sectors and becoming spending and investment within the country.
Other news: Income statement: This can be submitted if it is in a conjugal company
Is the official muscle weakened?
In terms of public procurement, we have seen specific moments in the year with greater dynamism. The most striking thing is that, instead of a subsidy -based policy, the impulse has arrived mainly on the side of state hiring.
In the months in which improvements have been registered, these are associated mainly to the linking of personnel through public contracts.
Consumption would be the protagonist of GDP growth.
Chatgpt image
Do you feel the fiscal crisis in growth?
The current situation, with high interest rates that will probably be maintained for a while, forces the government to borrow high costs to cover its fiscal deficit. This leads him to compete with the private sector for resources available in the market.
While for now there are no clear signs that this “displacement effect” is affecting private investment, a scenario of greater economic growth could generate tensions. The private sector would need more financing to invest and expand, while the public sector would continue to demand resources to cover its deficit.
Also read: The 7 Latin American countries that would be regional power in 2035, according to AI
Could investor trust recover?
I would believe that the construction of trust and the construction of fiscal credibility unfortunately will be the first tasks of the new administration that will be possessed on August 7, 2026.
This government has been very clear, we must recognize the transparency that you do not want, it will not look for spending cuts and, because, in regards to the dynamics, which it has had in these last three years, it will continue in the same direction, entering its last year of government.
Daniel Hernández Naranjo
Portfolio journalist
