While many countries are entering a slowdown or even recession, with the United Kingdom just announcing that it will implement a harsh fiscal adjustment plan with spending cuts and more taxes, Colombia continues to provide positive numbers in its economic growth.
The production of goods and services in the country varied, according to the Danish, by 7% in the third quarter of the year, which led to an annual growth of 9.4%, which is a prominent figure in Latin America and the world. panorama. In Chile, the economy grew by only 0.3%, in Peru by 1.6%, in Brazil by 1.36, and in Mexico by 1% in the same period.
Maintaining the momentum of sectors such as manufacturing, construction, information and communications, and financial activities. The performance of artistic, leisure and entertainment activities stands out, as it grew at a surprising rate of 36.9%, and this is attributed to the reopening of all kinds of events attended by the public collectively.
The only sector out of the 12 years reported by Dane to see a decline was agriculture, down 1.4%, a figure to sound alarms considering it’s one of the sectors hardest hit by higher input and fertilizer prices. It’s getting hit again by winter. If agriculture does not raise its head, it will be difficult for food prices to fall, which have risen by nearly 30% annually, and are most affected by inflation.
Although the economic outlook for Colombia appears favorable for this year, a completely different slowdown is expected in 2023 as everything points to a sharp slowdown, exacerbated by inflation, which will not easily subside, due to the high volatility of the dollar and advertising. of higher expenses. Analysts make their forecasts and estimate growth between 1% and 2% of GDP, but Jumhouria Bank is more pessimistic, forecasting only 0.5%.
The numbers are a kind of alert. These projections force us to be more careful about the health of the economy, because it depends on whether unemployment remains low and poverty does not rise further. This is especially necessary at a time when the government is announcing that in 2023 it will introduce new reforms that could cause more uncertainty in the markets and continue to open gaps in various sectors.
After the tax is approved, it will have to materialize the agrarian reform, land purchase and pension reform file in which there are no surprises because it includes proposals from three pillars announced in the campaign: Solidarity to pay the subsidy. up to 500,000 pesos per month for more than three million senior citizens who could not contribute; Another contribution pillar for those earning up to four minimum wages who must contribute to Colpensiones, and a supplementary pillar for those earning more than four minimum wages who will contribute private funds.
This proposal has pension fund managers (Afp) on edge, as they will see contributions drop dramatically and will have to liquidate a portion of their investment portfolio to pay the allowances. It should be remembered that Afps invests in government securities and stocks, which may lead to more volatility in the markets.
He will also introduce a labor reform whose scope is not yet known and could affect corporate payrolls, which he will make an even greater effort from next year when tax reform takes effect. And if the increase in the minimum wage is added, which will be about 15%, the situation for companies, especially small and medium-sized companies, becomes complicated. So it is not surprising that the manufacturing sector is experiencing a slowdown.
Another controversial reform that will be discussed in 2023 is health, which is not very friendly to Eps, to which will be added the fate of new oil and gas exploitation contracts in which there are many churches due to the contradictory positions of the president. Petro and some of his ministers.
As we can see, the health of the economy will depend not only on external factors but also on the decisions that are made and the way in which confidence is restored and adjustments are made for what is not going well without ending what is working. .
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