At a meeting in Cartagena, Colombian president Juan Manuel
Santos welcomed
the recent devaluation of the Colombian peso. He said, “We were heading towards
a situation of a Dutch cold. Not Dutch disease. We were depending a lot on oil
and mining for our exports, and what is happening has forced us to react and
strengthen other sectors.”
According to the Colombian president, the foreign direct
investment that has left the Colombian extractive sector has, almost dollar for
dollar, been invested in other Colombian sectors of the Colombian economy.
President Santos said that the two fundamentals of the Colombian economy still
hold true: continued economic growth and the country’s new middle class.
Colombian central bank co-director Ana Fernanda Maiguashca
largely agreed with President Santos, telling Bloomberg
that even the recent slowdown in economic growth, from 4.6% to between 3 and
3.5%, is good for the country. She said in an interview on Wednesday, “We’re
decelerating not only because we received a structural shock, but because we
need to. It’s not compatible to think that we will grow at the same rates as in
2014 and be able to close the current account deficit. If we need to reduce
that external vulnerability, that comes at the cost of lower growth.”
Unfortunately, news has not improved for the Colombian oil
sector. A Colombian watchdog entity, the Businesses Superintendent, told
the Colombian Senate that of the 53 oil services companies it assessed, 43% of
them are at a high risk of insolvency, and the remainder is at a moderate risk
of insolvency. Four companies in particular that make up part of the corporate
structure of Pacific Rubiales featured prominently in the study.
No comments:
Post a Comment