Colombia: Review Under the Flexible Credit Line Arrangement-Press Release and Staff Report
IMF Staff Country Reports, June 29, 2017
Source details
- Canonical URL
- Colombia: Review Under the Flexible Credit Line Arrangement-Press Release and Staff Report
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Bibliographic details
- Published: June 29, 2017
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781484303320.002
Overview
- Colombia continues to have very strong economic fundamentals and institutional policy frameworks.
- The IMF staff recommends the completion of the review under the FCL arrangement for Colombia.
Macroeconomic developments and policy response
- The policy adjustment to permanently lower oil prices was timely and decisive.
- Tight monetary policy helped anchor inflation expectations in the face of large but temporary inflation shocks.
- The exchange rate continued to float.
Fiscal policy and structural reform
- Fiscal policy tightened as prescribed by the fiscal rule, while protecting social and infrastructure spending.
- A structural tax reform, including a 3 percentage-point increase in the value-added tax, became effective in January 2017.
Key findings and recommendation
- Findings:
- Very strong economic fundamentals and institutional policy frameworks.
- Timely and decisive policy adjustment to lower oil prices.
- Monetary policy successfully anchored inflation expectations amid temporary shocks.
- Exchange rate maintained a floating regime.
- Fiscal consolidation respected the fiscal rule while protecting priority spending.
- Structural tax reform implemented (3 percentage-point VAT increase, effective January 2017).
- Recommendation:
- IMF staff recommends the completion of the review under the Flexible Credit Line (FCL) arrangement for Colombia.
Source: Colombia: Review Under the Flexible Credit Line Arrangement-Press Release and Staff Report, June 29, 2017.
Content in this bundle
- Country Report