Little by little, new details are becoming known about the bets that the Ministry of Finance has to face, in the coming months, the economic slowdown that the country is experiencing and that has several important productive sectors in the red, while experts and analysis centers insist that there is no more time to stop this scourge. if we want its consequences not to be more serious.
According to information provided by the same Minister Ricardo Bonilla, According to the head of the portfolio, the plan covers projects that will go to Congress, as well as initiatives that they hope to develop together with businessmen and the banking sector. These actions also seek to alleviate the cash squeeze in the nation’s accounts and prevent episodes such as the spending cuts that are already being implemented for 2024 from being repeated.
Ministry of Finance – Ricardo Bonilla.
The Minhacienda’s strategy will also be reflected in the General Budget of the Nation for 2025, whose project must be ready and presented to the Senate and the House of Representatives before July 30, while for now the bets predict a harsh adjustment in investment expenses for next year and that the Government must look for new sources of income.
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First of all, what has drawn the most attention is that the mini-reform that was expected from the Ministry of Finance will actually end up being a financing law with which new resources will be sought for the State, given that tax collection has been low throughout 2024 and money is needed to get President Petro’s programs up and running.
Ministry of Finance – Ricardo Bonilla.
“Given that we have to increase debt payments and that has serious implications for investment, we increase debt payments, but investment is reduced, investment is penalized, this process means finding the resources to guarantee a level of investment. We are already seriously thinking about a financing law that implies that we have to go and look for additional resources,” said Ricardo Bonilla.
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At this point it is worth noting that in the preliminary accounts The 2025 budget shows a cut of more than $30 billion in investment accounts, which would mainly go to pay debt, which, if we add that future terms occupy more than 40% of the tax burden on these resources, highlights the problem that must be solved by the Government.
Ministry of Finance and Public Credit
“That would be included in a single proposal, which includes incentives and additional resources. It would be accompanied, simultaneously, by two issues that we also have committed to. The issue of how to advance the application of the fiscal rule from year 26 to year 25, we cannot do that by decree, it has to be approved by Congress,” added the Minhacienda.
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Precisely with this last statement, the Government’s second plan was paved, which is the changes to the fiscal rule scheme in Colombia, which, although it will not affect its most important rules, it does want to be brought forward. execution, since otherwise the goals established by this regulation would not be met.
Colombian pesos
“We are identifying whether it can be included in the same law where the tax issues are or not, or if it has to be separate, that is a matter of unity of subject matter,” said Ricardo Bonilla, who was clear in warning that he will not ask for the limits established by this law to be raised, but he did insist that the slowdown continues to be a threat to collection and because of that, action is needed now.
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Finally, among the projects that will be taken to Congress, The Ministry of Finance also brought up the reform of public services, with which they will seek to have the Government assume the costs of the tariff option for the lowest strata, currently not permitted by law.
Ministry of Finance – Ricardo Bonilla.
“The process of both Findeter and the National Development Finance Company granting credit resources under the credit modality to the marketing companies is already underway, but what follows is the process in which we assume the debt acquired with Findeter and with the National Development Finance Company and the Government is the one that will pay it. But today we do not have the legal instrument to do so, so we have to incorporate it,” said the Ministry of Finance.
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Another important chapter in the details of the reactivation strategy that the National Government is preparing is related to all the actions that, although they will not go to the Legislative, are essential for the recovery, since they are part of the teamwork that has been requested for months between the private and public sectors.
Industry.
The first initiative is planned with the financial sectorachieving a significant reduction in interest rates for housing loans, highlighting that there is no “rate war”, while saying that working groups are being held with sectors such as construction, agriculture, textiles and clothing, seeking to identify and eliminate obstacles to reactivation.
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“The banks have fully understood the issue, the agreement we have reached here is that from that perspective they themselves are lowering rates much lower than what the Banco de la República is lowering, I mean much lower, it is at a faster speed. The Banco de la República will continue to lower them at a moderate speed, they have been lowering them at a faster speed,” he stressed.
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The Ministry of Finance added that it is necessary to get back on track as soon as possible, since, to give an example, the deterioration of macroeconomic conditions has represented a spread of 90 points for the country, by contrasting the difference in value between the purchase and sale price of the Nation’s assets.
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José Roberto Acosta, director of public credit at the Ministry, said that “we, compared to a comparable country like Brazil, paid about 90 basis points on average from 2016 to May. When we bring the present value, both in external debt, only in bonds, not multilateral, and in fixed-rate debt in the domestic market, we see that those 90 basis points, in this period, have represented about US$7.4 billion, which at today’s exchange rates are, as the minister mentioned, about $29 trillion.”
Ministry of Finance – Ricardo Bonilla.
Because of this and other alerts that continue to be issued regarding the situation, the Ministry of Finance was clear in saying that the sectors in red have already been identified and that they will not lower their guard until the situation is back on track in these sectors, working hand in hand to implement concrete measures so that they can recover.
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