What Jumps Out: The Gates of Hell

In perhaps the shock news of the week, congress, which previously couldn’t be bothered to even attend the debates, appears to have agreed to a 2026 budget of $140 billion USD, a slight reduction, which will come out of the tax reform, which has been pegged back to $4.1 billion USD with gasoline & alcohol being given a pass this time around. Anything done via consensus is a step in the right direction in Colombia.

We already touched on the United Nations this week, where Gustavo Petro called out Donald Trump on Venezuela, Gaza, climate change, and narcotics. It’s a hazardous game, but pushing back on a bully is never a bad thing.

Naturally, it caused consternation amongst some locals, namely ANDI – Asociación Nacional de Empresarios de Colombia, and the private sector, who put profits ahead of any global crisis. Politicians to the right were also in a tough spot, after all, they largely have the compassion level of the current White House, whilst having perhaps been too vocal in their cringing congratulations when Trump took office.

Imports from Departamento Administrativo Nacional de Estadística – DANE Colombia, a reflection of domestic demand and economic confidence, hit a new high in July, up 16.2% to $6.5 billion USD, a 22-month high. The Peso has strengthened rapidly of late, along with the stock market, and that will only add to overseas spending. The problem, of course, is the deficit ($1.6 billion USD), which again had a crushing month.

Fedesarrollo released its September survey. Whilst YE overnight rates (9.0%) and GDP (2.6%) were stable, there was a bump in inflation from 4.94% to 5.08%. This last number is perhaps a big factor in a small decline in retail and industrial confidence for August.

Thus far, an odd week in Colombia, which closed with The Economist titling a pretty tepid piece of journalism “Is Colombia at the Gates of Hell” – a wildly inaccurate way to frame the current situation and more befitting of social media sensationalism. Will the next president have plenty to do? No question. Did Iván Duque hand over a mess? Likewise.

Have a great Friday.

Regards.

Roops.

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Colombian Peso. Photo credit: Jared Wade.