Under the premise that debt does not generate growth and, on the other hand, investment does, the Government will ask the International Monetary Fund (IMF) to renegotiate the term of a part of the debt with that organization in order to have greater space in that aspect.
This is what the Minister of Finance, Ricardo Bonilla, said during the XVII Asofondos Congress, where he said that Colombia has always fully paid its obligations, but at this moment it is necessary to launch a part of the debt with the IMF forward and this will be made known to the director of the organization Kristalina Georgieva.
(Read more: Minhacienda says that in the pension reform a minimum wage fund would be exhausted)
Bonilla said that the years 2021 and 2022, in which there was strong growth in the gross domestic product (GDP) “They were growth due to debt, that is, we grew a lot in those years, but the country remained heavily in debt.”
He pointed out that the country has a quota of US$70,000 million in foreign debt which is flexible and as the debt is taken on the quota lowers and if it is paid the quota opens.
Bonilla stressed that during the pandemic emergency decrees were issued without using that quota. “That debt was with the IMF and other organizations,” said.
He warned that these debts expire in 2024 and 2025. “As they were outside the indicated quota, no new quota is opened, so we have to find the resources to pay,” he pointed.
He emphasized that the “We are paying for debt growth, like the fuel fund deficit that remained at $37 billion and is paid from the budget and dropped to $20 billion in 2023 and those are paid now in 2024 and that is the agreement.”
Bonilla commented that “Unfreezing fuel prices means reducing the deficit but it has to be paid for. An important part of the budget is for these payments and resolving the tariff option with subsidies and for Findeter to grant compensated credits to the marketers.”
One of the main arguments for the renegotiation with the IMF is because in 2025 they should be paid between external and internal debt $125 billion and then we will try to carry forward part of the debt with the IMF or else the space for investment would be reduced. “The debate is, do we pay debt or invest or how do we balance the two. It is the most important macro discussion. For the 2024 budget it was balanced at $96 billion”Bonilla said.
(Read more: Inflation would not meet the target in 2024 and would affect monetary policy)
The Minister of Finance, Ricardo Bonilla, said that as a result of the discussion of the pension reform bill, the entity issued a concept of fiscal viability in which he says that the solidarity pillar requires resources.
He mentioned that in the contributory pillar, which is the axis of the discussion, reveals that in a scenario without reform there would be an imbalance in pension liabilities of 59.8% and after the reform it drops to 54%, with a threshold of three minimum wages.
For the minister, if the threshold were “four minimum salaries, the fund created would last until 2074, if there were three, it would last until 2070, if there were two and a half salaries, until 2069, with two salaries until 2065, with one and a half salaries until 2050 and one salary At least there is no background. Colpensiones would not have money to accumulate, since the money comes and is paid to the pensioners.”
“The higher the threshold, the payment commitment of pensioners can be met and the public dissavings would be less,” the minister emphasized.
(Read more: What are the problems that are affecting the peace of Colombians the most)
He said that in pensions we know that “The competition between the two systems does not work and what happens is that in recent years thousands of members have left the funds for Colpensiones and if we do not carry out the reform we will have a greater exit, which takes resources away from the funds, but it does not solve the pensions of Colombians.”
The Minister of Finance said that “the funds register a profitability and that is what they are for,” but he assured that of the $405 billion that they have under administration, $146 billion are in TES and the main reason is that it gives returns, that is, from dissaving, since they are the payments of interest on public debt.”
For its part, Asofondos specified that Colpensiones has more pensioners than the funds because it is an older regime. “The average age of the RPM (Average Premium Regime) of Colpensiones is 51 years while that of the RAIS (Individual Savings Regime with Solidarity of private funds) is 36 years.”
Asofunds
He also said that in the RAIS the contribution that goes to the individual account is 11.5% while what goes to the Common Fund is 13%. This difference generates a 30% lower pension. That is why the systems are not comparable.
For Asofondos, in the flows of the AFPs the minister, Ricardo Bonilla, does not take into account the income from pension bonds and pension insurance. However, that is a mistake, since the resources are what finance the payment of allowances.
The union assured that “The Minister measures national savings only as what exists in the Savings Fund, however savings are also what remains in the individual accounts of members. So if we look at public and private savings as a whole, the more the threshold is reduced, the more savings we have.”
Asofondos considers that the Minister refers to the returns obtained by the AFPs as being obtained in part by the interests paid by the TES bonds and that this is inefficient. However, what the Government does not take into account is that with a pensioner in the RPM the Government assumes a debt at 7% real, while with the capital market it is 4% real.
(See: Colombian banking, your finances and the problem of the three bodies)
Dollar rose 101 pesos in the week
The dollar in Colombia closed the week above $3,800, after its price skyrocketed in the last two days upon learning of the increase in inflation in the US.
According to the Stock Exchange, The foreign currency closed at an average of $3,865, that is, it rose 45 pesos compared to the Representative Market Rate, which was $3,820.
Between Monday and Friday, the US currency increased $101, after starting the week at $3,764. The increase in the exchange rate occurred after it was known that inflation in the United States rose again in March, with a growth of three tenths, to 3.5%.
(Read more: Pension funds want a pension reform based on savings)
HOLMAN RODRÍGUEZ MARTÍNEZ
Briefcase
