Open, Inclusive Growth Is the Path Forward for Colombia’s Economy, Says President Santos

Colombia has reached a ceasefire with the Revolutionary Armed Forces of Colombia (FARC) and President Juan Manuel Santos says that the final peace accord will soon be presented to a popular referendum. The president expects the economy to take off if the nation’s people vote to approve the agreement, but he has stressed that this must be fueled by open, inclusive growth.

Continuing to attract foreign direct investment will be key. “We are fervent believers in the need to receive foreign investment,” said Santos at a recent World Economic Forum event in Medellín. “Right now we have the highest foreign investment in our history. We want to maintain it and increase it.”

Colombia has become a leader in the region when it comes to promoting free trade and an open society for investment. But more important than luring approval from abroad, Santos highlighted the need to ensure those within the country — everyone in the country — shares in a new era of prosperity.

A March report from the World Bank found that, after Honduras, Colombia is the most unequal country in Latin America in terms of the distribution of wealth. Deep structural problems exist, highlighted by the fact that nearly four out of every five acres of land in the country is owned by less than 15% of the population.

Those internally displaced by war have been particularly depressed by the nation’s inequality, a problem that the United Nations High Commissioner for Refugees has been fighting to improve. In April, the agency said that it has helped 38,700 people in 17 localities obtain housing, land, and “livelihoods opportunities” that have helped them re-gain the basic fundamental rights that the nation’s elite have taken for granted since before the war began in the mid-1900s.

“Parts of Colombia haven’t grown at all for years because of the conflict and the absence of the state,” said Santos. “When peace comes, we expect they’ll grow at rates of 8%, 10%, or even 12% and help the rest of the country grow faster, too.”

One attempt to narrow the gap has been Colombia’s increasing investment in schools and learning programs, something designed to help meet the president’s ambitious goal to become the best-educated nation in the region by 2025. Among the many projects financed through the public Educational Infrastructure Financing Fund (FFIE), a Peruvian firm last week won a $135 million USD bid to build 3,000 classrooms in 14 cities. “Education is the most important factor for social mobility in any society,” said Santos.

The president of Argentina, Mauricio Macri, shared the stage with his Colombian counterpart as the two addressed the capacity crowd. And he, too, talked about the need for Latin American nations to better educate the next generation so they will be able to drive the economy through the jobs of tomorrow.

“The fundamental pillar to overcome poverty is employment, which is based on education,” said President Macri. “We have to invest heavily in education and be bold — not fearful of innovation.”

(Photo: Colombian President Juan Manuel Santos and Argentine President Mauricio Macri address the crowd at a June 2016 World Economic Forum event in Medellín. Credit: World Economic Forum / Benedikt von Loebell)