The red lines of the growth data of the Colombian economy in April

He April economic growth data (5.52%) surprised many market analysts, but positive waywho, although they expected positive data that would fluctuate, did not think that it would reach the level reported by the entity.

However, according to the analysis of Carlos Arturo Garciaeconomic journalist for EL TIEMPOthe consensus of several experts indicates that it is not yet time to declare victory and that we will have to wait for the data on the behavior of the economy for the month of May and for the execution of the long-awaited reactivation plan announced so that the dynamics of the country can wake up.

(More: Taxes in Colombia: the larger the company, the less they pay).

According to him, this performance of the economy was driven by primary activities, of which agriculture, livestock, hunting, forestry and fishing; and Exploitation of mines and quarrieswhich presented an annual dynamic of 10.24%.

For their part, the secondary activities (manufacturing industries; and construction) They advanced only 2.85% compared to April of last year, while the tertiary sectors, including the supply of electricity, gas, steam and air conditioning; water distribution; Wholesale and retail trade, and Repair of motor vehicles and motorcyclesamong others, presented an advance of 5.09%.

“It should not be overlooked that investment is still hit, so the message of the reactivation agenda is not lost. The secondary sector, that is, construction and industry, has seen a drop of 2.8 percent so far this year. Without investment, the problem of medium and long-term growth remains valid“warns Cesar Pabón Camacho, Executive Director of Economic Research at Corficolombiana.

This economic performance, as García mentions, had not been observed since September 2022, when 4.21% was reached in the Economy Monitoring Index (ISE)according to statistics revealed by Dane.

Colombian economy

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However, this dynamic is explained, to a large extent, by a calendar effect and the occurrence of Holy Week, as indicated. Luis Fernando Mejía and José Ignacio López, directors of the economic study centers of Fedesarrollo and Anif, respectively.

“Holy Week this year was in March, while in 2023 it will be in April. Adjusted for this calendar effect and seasonal factors, economic growth was 4% annually in April, exceeding market expectations.“said Mejía, while López warns that although this figure is positive, it is still worrying, Because in his opinion there are still important lines such as industry and commerce with weak data.

According to the president of Anif, it is clear that until we have the May figures at hand, It is difficult to know for sure how persistent or definitive that April rebound will be.although it is not unknown that the industry, due to calendar effect, had better results.

Colombian economy.

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“The agricultural sectors, which had some good harvests of products, public administration and hydrocarbons, are also positively surprising, taking into account that April was a month with rising oil production.“, says.

When the data on the dynamics of the economy in April was released, President Gustavo Petro published on his X account: “Good in agriculture, in foreign tourism, good in industry. The reactivation has begun after Duque’s artificial overheating and his rise in inflation. We lower inflation and reactivate production, which is what generates wealth. Agriculture without coffee. Growth in one year: 9.3%; Foreign tourism; 7.3%; Industry: 4.1%“.

However, criticism of the Government’s view of April’s economic growth data did not become special. José Manuel Restrepo, rector of the EIA University and former Minister of Finance and Commerceresponded to the head of state: “President. The first step to improve is always to recognize what is not good and can be improved, for the benefit of Colombians. There are improvements, but the GDP trend is cautious“.

Colombian economy.

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Restrepo also pointed out that the industrial production index continues to have a decreasing trend, which tradea great source of employment, has been declining for 17 months, which private investment completes five quarters with double-digit downward figures, which the country recorded the worst quarter of business creation in four yearsthat he National tourism and the gastronomy continue to decline and that the recovery of the construction remains weak, reasons that also explain the low tax collection.

Juan Daniel Oviedo, former director of Dane and today councilor of Bogotáalso joined the questions regarding the data published by the statistical entity and shared by the president: “They should help you reflect that we are not on the right path“, adding that the sectors that he considers key in his economic policy are very weakened today.

You can read Carlos Arturo García’s full analysis at this link.

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*With information from EL TIEMPO – ECONOMÍA