The recent revelations by the Attorney General’s Office regarding the alleged direction of contracts and bribes from the National Government to buy votes in Congress in favor of social reforms and other important initiatives have caused quite a stir in the country. for the Casa de Nariño, and which so far involve several high-level officials.
What began as an irregular purchase with overcharges for several tank trucks According to the Risk Management Unit (UNGRD), at this time it is alleged that the Ministry of Finance ordered the commitment of resources to regional governments, in order to benefit political clans that supported the Government’s legislative proposals.
Tank trucks
UNGRD
Although there is still much to be done and the authorities are in the preliminary stages of their investigations, all the legal noise that this has been generating could take a costly toll on President Petro’s new economic bets, such as the reactivation plan, the financing law, as well as the labor and health reforms that are preparing for a new round in Congress.
Laura Lizarazo, global risk analyst at Control Risks, warns that at this moment there is an erosion of credibility and legitimacy in the Executive branch, which she foresees that despite The change in the Government’s political line has not broken with traditional clientelist practices.
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“Not only has this administration reproduced the same logic of cronyism and allocation of bureaucratic quotas as past governments, but it has also devoted part of the scarce and valuable resources of the high government (political capital, time, visibility, rhetoric) to defending itself on the multiple battle fronts that each new scandal opens up for it,” he said.
In this sense, he highlights that currently the Casa de Nariño has dedicated resources to defend themselves on multiple fronts instead of investing in their constitutional and electoral mandate; making it clear that the relationship between parties, parliaments and the executive will probably continue under traditional logic, without significant changes despite the scandal.
Ministry of Finance – Ricardo Bonilla.
Courtesy – Ministry of Finance
“Unfortunately, these types of practices (whose veracity and scope in the case of UNGRD will be proven by the corresponding investigative authorities) are so widespread and naturalized in the exercise of politics in Colombia, that they are practically part of the daily panorama of decision makers and political operators,” said Lizarazo.
A busy schedule
Among the big bets that President Petro has This semester, in the Senate and the House, there is the Budget project for 2025, which predicts strong cuts in investment and will be under scrutiny due to this year’s scandals on this front. Also among the protagonists is the financing law, which is expected to lead to a new tax squeeze.
Read here: Key facts to understand what is happening with the UNGRD corruption case
In this regard, for the former Vice Minister of Finance, Juan Alberto Londoño, we must not forget that in the third year of government, economic discussions become more difficult due to the analysis of the political cost of unpopular decisions by Congress.
“This situation, added to the irregularities that have occurred and that have the Minister of Finance as one of those involved, takes away from him a lot of room for maneuver and a lot of political capacity, which puts him at risk the Government’s economic agenda. Even more so when they are announcing a tax reform,” he said.
Colombian pesos
iStock
Political analyst Luis Alberto Villamarín has a similar opinion, arguing that the government’s economic reforms and investment plans will be viewed with greater caution by Congress due to the scandal currently rocking the Casa de Nariño.
“This adds to the negative effects for Petro’s interests, “The new phase of the congressmen’s quest for reelection has already begun in the Congress of the Republic and they will not have the same political or emotional disposition to support any reform. To top it off, Petro, with his defiant behavior and his constant messages of conflict, is just adding fuel to the fire,” he said.
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Reforms in sight
In addition to the tax and budget discussions, President Gustavo Petro’s economic pawns have pending projects such as labor reform, which still has three debates left, the increase in the debt ceiling, the reform of the public services law and the caps on property taxes. This is without mentioning that he plans to resume the fight on fronts such as health and education reforms.
Thus, Jorge Restrepo, professor at the Universidad Javeriana, adds that the increased surveillance that is being forced by the Risk Management scandal could improve the functioning of Congress, focusing on the content and impact of projects rather than on transactional politics.
“Although the Colombian political system has long been using transactional politics, a form of clientelism in which the General Budget of the Nation is allocated to regional items that are managed by representatives and senators, in some cases, this has the impact of making it much more expensive, as it should be, because there will be many more eyes on this type of project,” he explained.
Plenary session of the House of Representatives in the Congress of the Republic.
Pedro Vargas
Finally, former Finance Minister Juan Camilo Restrepo highlights that The repercussions of this scandal are not only local, as agencies and other international organizations have their sights set on it, thus increasing the perception of risk in Colombia.
“The scandal of the Risk Management Unit and the widespread corruption are having a very bad reception abroad. The risk premiums that Colombia has to pay for its loans are the highest in the region and all this delays or hinders economic recovery,” said this expert.
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Thus, the next few months for the National Government predict great challenges in legislative matters if it wants to fulfill everything it set out to do and must begin by recovering the legitimacy that has been lost and to avoid new scandals that could complicate the steps to follow.
Daniel Hernandez Orange
Portfolio Journalist
