Turmoil
President-elect Iván Duque, just a few days from taking office, is already seeing new challenges piling up, which means everyone is looking to his first days, to ascertain his style.
But some economic and fiscal challenges will loom, no matter what kind of president Duque turns out to be. The most critical issues, in our view, are immigration from Venezuela, and the need for faster GDP growth, improvement in social indicators, a jump-start for sectors vulnerable to social protest, and fiscal reform.
Squaring the circle of fiscal consolidation, and meeting demands for additional spending, while keeping debt ratings in place, is a must for the next administration. Fortunately, Alberto Carrasquilla will be in charge of public finances, but the difficulty of keeping the congressional majorities needed to pass the toughest fiscal reforms could rise, with ex-president Alvaro Uribe’s resignation from the Senate.
The announced group of future cabinet ministers is good news from the point of view of policy, but less so from the point of view of politics. Politicians would have preferred to see faces familiar to them, people they could talk to, and from whom they could receive favors. We are about to witness is the reaction of career politicians against a well-conformed, yet technical cabinet with no political representation.
These politicians are hungry to participate in government. Should Duque opt for testing the waters and their patience, they would give leeway to opposition parties’ initiatives and make the president’s life harder.
In an unexpected turn of events, turmoil has resulted form former president Uribe announcing his intention of resigning his Senate seat, due to an accusation by the Supreme Court of alleged witness tampering, in a dispute with leftist senator Ivan Cepeda.
The Congress and Government most likely will work in order to undo this situation and convince Uribe to withdraw his resignation. From our point of view that is the most likely scenario. Uribe is critical for managing and maintaining congressional coalition cohesion.
If Duque’s government can’t deliver faster social results, especially on the periphery, the outcome of the 2022 election might not be pleasant for what one could call the establishment. The new social demands from youth in the large urban centers is an even bigger challenge.
For Mr. Duque, governing Colombia promises to be anything but boring and easy.
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