[Peace-discuss] Fwd: [ufpj-activist] Colombia’s economic outlook darkens: report - Leftist leader joins Santos government

Thu Apr 28 08:58:50 EDT 2016

"However, inflation is picking up, as citizens will have noticed. It hit
8% in March — it’s highest level since October 2001. This is in part due
to a shrinking food supply — caused, among other things, by one of the
worst droughts — which has forced food prices up."

-------- Forwarded Message --------
Subject: 	[ufpj-activist] Colombia’s economic outlook darkens: report -
Leftist leader joins Santos government
Date: 	Thu, 28 Apr 2016 06:53:34 -0500
From: 	Cort Greene <cort.greene at gmail.com>
To: 	globalresistance at yahoogroups.com <globalresistance at yahoogroups.com>

http://colombiareports.com/leftist-opposition-leader-resigns-accepting-job-government/
<https://urldefense.proofpoint.com/v2/url?u=http-3A__colombiareports.com_leftist-2Dopposition-2Dleader-2Dresigns-2Daccepting-2Djob-2Dgovernment_&d=CwMFaQ&c=8hUWFZcy2Z-Za5rBPlktOQ&r=_iuwmBDMEAIAz6k1h--JVoji6x5mlDiImSbbdIp2zWg&m=VN23gEflrNYnNju86hPx_CEaapouFZ2pcq9Wh4XvT_Y&s=JrWhZGXEcOWsTgeAV3Z0HJFfGMOaMj8709dnd4HFZns&e=>
Clara Lopez
<https://urldefense.proofpoint.com/v2/url?u=http-3A__s3.amazonaws.com_colombiareports_wp-2Dcontent_uploads_2016_04_26120325_clara-5Flopez.jpg&d=CwMFaQ&c=8hUWFZcy2Z-Za5rBPlktOQ&r=_iuwmBDMEAIAz6k1h--JVoji6x5mlDiImSbbdIp2zWg&m=VN23gEflrNYnNju86hPx_CEaapouFZ2pcq9Wh4XvT_Y&s=GhohpFWsAd1OC8RhtHbtK0_jfYj6IijvIjjP4SNiQPI&e=>
NEWS
<https://urldefense.proofpoint.com/v2/url?u=http-3A__colombiareports.com_colombia-2Dnews_news_&d=CwMFaQ&c=8hUWFZcy2Z-Za5rBPlktOQ&r=_iuwmBDMEAIAz6k1h--JVoji6x5mlDiImSbbdIp2zWg&m=VN23gEflrNYnNju86hPx_CEaapouFZ2pcq9Wh4XvT_Y&s=1h7qhiiDSxdGT9s5Yei0swksl_ZBNoXmDMTwmDoDwuk&e=>

  Colombia’s leftist opposition leader resigns after accepting job in
  government

written by Thomas Graham
<https://urldefense.proofpoint.com/v2/url?u=http-3A__colombiareports.com_author_thomasgraham_&d=CwMFaQ&c=8hUWFZcy2Z-Za5rBPlktOQ&r=_iuwmBDMEAIAz6k1h--JVoji6x5mlDiImSbbdIp2zWg&m=VN23gEflrNYnNju86hPx_CEaapouFZ2pcq9Wh4XvT_Y&s=VIhHXgpvZe_oXh1nogT17UTF6W7Dv9iPnRLPN81tnp0&e=> April
26, 2016

The leader of Colombia’s leftist opposition resigned after her party
rejected her new job as Labor Minister in the government she was
supposed to oppose.

The board of the Democratic Pole (PDA) party voted unanimously to accept
the resignation of Clara Lopez as their president, following her
appointment as the new Minister of Labor.

------------------------------------------------------------------------

*Santos incorporates leftist opposition to cabinet, leaving Uribe even
more marginalized*
<https://urldefense.proofpoint.com/v2/url?u=http-3A__colombiareports.com_santos-2Dincorporates-2Dleftist-2Dopposition-2Dcabinet-2Dleaving-2Duribe-2Deven-2Dmarginalized&d=CwMFaQ&c=8hUWFZcy2Z-Za5rBPlktOQ&r=_iuwmBDMEAIAz6k1h--JVoji6x5mlDiImSbbdIp2zWg&m=VN23gEflrNYnNju86hPx_CEaapouFZ2pcq9Wh4XvT_Y&s=NA_kZjzUbAdqtggJ8G-D_APO_MsELzOOt9cvuccYjvw&e=>

------------------------------------------------------------------------

      Profile

    Clara Lopez
    <https://urldefense.proofpoint.com/v2/url?u=http-3A__colombiareports.com_clara-2Dlopez_&d=CwMFaQ&c=8hUWFZcy2Z-Za5rBPlktOQ&r=_iuwmBDMEAIAz6k1h--JVoji6x5mlDiImSbbdIp2zWg&m=VN23gEflrNYnNju86hPx_CEaapouFZ2pcq9Wh4XvT_Y&s=vrtrskRQHUVqYKoXyYivZT3UMMri8rGg53-4vu2Pqoc&e=>

The appointment of Lopez was part of a broad cabinet reshuffle by
President Juan Manuel Santos. He granted minister positions to both
leading left and conservative opposition politicians. This put the
parties in the peculiar position of opposing a cabinet in which they are
now represented.

Santos also sought to diversify his cabinet by making appointments
outside the traditional Bogota political elite.

In an interview with Caracol Radio, Lopez said she is very enthusiastic
“about the challenge that Santos has handed me in the final straight of
the peaces talks with FARC and in the opening of dialogues with ELN.”

------------------------------------------------------------------------

*Colombia’s political players agree to more equal distribution of power
and slush funds
<https://urldefense.proofpoint.com/v2/url?u=http-3A__colombiareports.com_colombias-2Dpolitics-2Dagree-2Dequal-2Ddistribution-2Dpower-2Dslush-2Dfunds_&d=CwMFaQ&c=8hUWFZcy2Z-Za5rBPlktOQ&r=_iuwmBDMEAIAz6k1h--JVoji6x5mlDiImSbbdIp2zWg&m=VN23gEflrNYnNju86hPx_CEaapouFZ2pcq9Wh4XvT_Y&s=4n_h9CnxZIpy4UmoEblOdhhrQOixxKe4tkmU3fz86Ms&e=>*

------------------------------------------------------------------------

However, voices within Polo were less enthusiastic. Senator Jorge
Robledo was clear that “Clara Lopez should not accept the position. If
she does she should resign as president of Polo, so that it can continue
in opposition to Santos.”

Following a party meeting, it was announced that Lopez would resign.

“The national executive committee of Polo Democratico has accepted the
resignation of President Clara Lopez Obregon and announces that her
decision to take the position of minister will not compromise the
opposition of this leftist party to the government.

Nonetheless, the PDA indicated that it will continue supporting the
peace talks with FARC in Havana and the opening of negotiations with ELN.

Those in the Santos administration did welcome the appointment.

The Interior Minister, Juan Fernando Cristo, hailed the new cabinet as
more representative of the country. “There are more women, there are
more parties, there are more regions and there are indigenous people,
and with this it demonstrates the necessary diversity for territorial
peace.”

The President of the Senate, Luis Fernando Velasco, also approved of the
cabinet reshuffle. “I like the ideological diversity that comes with the
inclusion of Clara Lopez as minister of labor. This is an important
indication of the need to forge a different country once the peace
treaty has been signed.”

---------------------------

http://colombiareports.com/colombias-economic-outlook-darkens-report/
<https://urldefense.proofpoint.com/v2/url?u=http-3A__colombiareports.com_colombias-2Deconomic-2Doutlook-2Ddarkens-2Dreport_&d=CwMFaQ&c=8hUWFZcy2Z-Za5rBPlktOQ&r=_iuwmBDMEAIAz6k1h--JVoji6x5mlDiImSbbdIp2zWg&m=VN23gEflrNYnNju86hPx_CEaapouFZ2pcq9Wh4XvT_Y&s=vTZu29AmcnbzxgAl89LxbBUd1E-ikoEdHt6tcW2HBu0&e=>

  Colombia’s economic outlook darkens: report

written by Thomas Graham
<https://urldefense.proofpoint.com/v2/url?u=http-3A__colombiareports.com_author_thomasgraham_&d=CwMFaQ&c=8hUWFZcy2Z-Za5rBPlktOQ&r=_iuwmBDMEAIAz6k1h--JVoji6x5mlDiImSbbdIp2zWg&m=VN23gEflrNYnNju86hPx_CEaapouFZ2pcq9Wh4XvT_Y&s=VIhHXgpvZe_oXh1nogT17UTF6W7Dv9iPnRLPN81tnp0&e=> April
26, 2016

Colombia’s economy is facing a bleak few years before it’ll be able to
crawl out of its economic slump, according to a newly released report.

The LatinFocus Consensus Forecast collated research from central banks
and independent panelists to gauge the continent’s economic outlook.
Their conclusions do not bode well for Colombia — at least in the
short-term.

The good news was few and far between. In February, industrial
production was bolstered by the newly-upgraded Cartagena refinery and
its index growth reached an almost two year high. Unemployment was also
down by two percentage points.

However, inflation is picking up, as citizens will have noticed. It hit
8% in March — it’s highest level since October 2001. This is in part due
to a shrinking food supply — caused, among other things, by one of the
worst droughts — which has forced food prices up.

Moreover, consumer confidence has dropped sharply since the turn of the
year, likely due to inflation and pessimism about the country’s economic
conditions. Simply put, people are being cautious and not willing to
purchase major items.

According to the report, the central bank’s efforts to reduce inflation
and the expanding current account deficit will impede growth in 2016.

It has increased the reference interest rate to 6.5% in an attempt to
curb inflation. The logic here is that by increasing interest rates,
consumers will have less money to spend. And with less money to spend,
the economy slows and inflation decreases, coming back under control.

However, although interest rates are a major driver of inflation, there
are other factors involved. So success is far from guaranteed. Panelists
estimate 2016 will close with inflation at 5.8%, and expect this to drop
to 3.7% for 2017.

Once inflation is under control, the central bank can take measures to
accelerate growth once more.

However, many events in 2016 will be beyond their control. This is
introducing a lot of uncertainty that is reducing confidence in
Colombian markets.

For one, the national security situation is unclear. Although peace
treaties with FARC and perhaps ELN are seemingly in the horizon, the
first deadline for the deal was missed and the result is far from certain.

Similarly, the effect of El Niño cannot be predicted with any surety.
Many expect this year’s El Niño to be one of the strongest in six
decades. It may result in a severe and persistent drought across
Colombia, affecting crop yields and causing forest fires.

Clearly this will affect the price of basic consumables, and thus
inflation. Attempts to limit the damage of forest fires are also costly
blow for a government that is already running a deficit.

However, the biggest driver of Colombia’s recent economic struggles has
been the crash in oil prices. Colombia is the third largest
oil-producing country in Latin America and oil makes up roughly 50% of
its exports.

So it is unsurprising the crash in price of a barrel of oil has rattled it.

The crash is a simple matter of supply and demand. Many economies are in
recession and some are becoming less reliant on oil. Both of these
factors are reducing demand. Yet supply has rocketed due to an oil glut,
meaning that the price of a barrel has plummeted. This has reduced the
value of Colombia’s exports.

The Colombian peso is therefore strongly linked to energy prices. Until
oil-producing countries agree a deal to freeze oil production to
increase energy prices down the line, the Colombian peso will continue
to be volatile.

Unfortunately, the last round of talks between oil-producing countries
on April 17th failed to produce an agreement.

With domestic uncertainty and a weak, unstable international economy,
2016 looks like it will be a trying year for Colombia. However, the
report’s panelists agreed that promising growth would return beyond 2017.

But, realistically, trying to predict the economy that far into the
future is a fool’s game.

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