After several weeks of revision in the country, the Executive Board of the International Monetary Fund (IMF) met on March 22 to conclude the consultation of the Article IV of Colombianame by which the annual visit made by the entity to different countries is known.
The IMF highlighted that the country’s economic policy continues to be solid and aimed at correcting the macroeconomic imbalances of the pandaemiawhile protecting the most vulnerable and advancing on structural reforms.
(IMF highlights the structural reform agenda in Colombia).
The technical team’s document highlights that the country’s economic policy framework “remains solid” and that it continues to work to correct the macroeconomic imbalances accumulated during the pandemic.
“Despite the current complex international landscape, the country’s strong policies and institutional frameworks continue to support the resilience of the economy and its ability to respond to crises.”, highlighted the entity.
(A. Latina would have a “difficult” 2023 and its economy would only grow 1%).
In terms of economic growth, the IMF board highlighted the growth figure of the Colombian GDP in 2022, which registered an expansion of 7.5%.
For 2023 the entity projects a figure of 1%which would rise to 1.9% in 2024 and 2.9% in 2025. From now on, a sustained expansion of 3.3% is projected.
The IMF recognized that after boosting economic activity last year, the country is expected to adjust towards a more sustainable path of growth, driven by more restrictive macroeconomic policies.
(Colombia was visited by more than 4.6 million tourists in 2022).
According to the international body, spending excesses are expected to moderate and disappear this year.
In relation to inflation, the projection of the entity for the end of 2024 is located at 8.4%, still above the target range of the Bank of the Republicwith a more marked decline from next year.
The expectation for 2024 for the consumer price index (CPI) is at 3.5%, and thereafter at 3%.
(Two luxury cruise ships will navigate the Magdalena River in 2024: this is what they offer).
The IMF report emphasizes the need to continue with “the tightening of macroeconomic policies to deal with the country’s internal and external imbalances”. The organization recognizes that the cooling of the economy will support the reduction of inflation, which recognizes that it continues at high levels, and that it will also help to reduce the external imbalance.
The IMF board also referred to the reform agenda being promoted by the Government of Gustavo Petro and its impact on the national macroeconomic situation.
The IMF pointed out in its technical report the need to “implement the reform agenda in a careful and prudent manner, in order to ensure fiscal and financial stability”.
(Five extraordinary powers fell for Petro).
After the publication of the document, Finance Minister José Antonio Ocampohighlighted the support for Colombia’s macroeconomic policy and also thanked “the rigorous and favorable evaluation of the country”.
The ministry assured that the IMF “applauded the ambitious agenda of structural reforms with the purpose of strengthening social policy, promoting a productive transformation and promoting a gradual energy transition, which will reduce the economy’s dependence on mining and energy products, as well as lay the foundations for more growth sustainable”.
Treasury also highlighted the government’s commitment to reduce the fiscal deficit and public debtin compliance with the fiscal rule.
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