Colombia and the IMF
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"I am very pleased to be today in Bogotá, at the start of my current trip to four of the Andean countries. This is my fifth visit to Latin America since I took office in June of last year. I was privileged to meet with President Alvaro Uribe, Finance Minister Alberto Carrasquilla, Banco de la República General Manager José Darío Uribe, and other members of the President's economic team over lunch. Earlier today, I met with congressional leaders, representatives of labor unions, and with local economists. I also had the opportunity to visit the Hogar Sagrada Familia and the Hogar Comunitario, and see first hand the government's efforts to improve the quality of life for the most vulnerable. Later today I shall meet with business leaders.
"In my discussions with the President and his economic team, we focused on the situation in Latin America and in the global economy. There is a clear sense that the region is currently enjoying its best growth performance in a decade and Colombia's pursuit of sound economic policies has ensured that it is sharing fully in the upswing. Indeed, Colombia's economic program that has been supported by a precautionary Stand-By Arrangement from the Fund has already delivered clear dividends. Growth has steadily increased, inflation has declined to relatively low levels, the external situation is comfortable, and the public debt is on a clear downward path.
"The government is currently formulating a successor economic program for which they intend to request continuing Fund support through another precautionary Stand-By Arrangement. As part of this program, the government is looking to entrench macroeconomic stability, consolidate fiscal sustainability, and undertake structural reforms crucial to raising growth and employment and reducing poverty in Colombia. In particular, the authorities intend to well preserve central bank autonomy as part of their inflation targeting regime, while continuing fiscal reforms would make the tax structure and spending more efficient, and strengthen fiscal coordination among different levels of government.
"We agreed that the sustained fiscal reforms would improve public savings and create room for expanding public and private investment in Colombia. In Colombia, as well as in other countries in Latin America, infrastructure needs are appropriately being given high priority, within a framework of assuring overall fiscal sustainability. I discussed with President Uribe the initiatives that are currently underway in the Fund to help countries better meet their infrastructure needs. Colombia is among the countries that is participating in a pilot project toward this end and the Executive Board of the IMF will meet this spring, to develop the lessons and the priorities yielded by the experience of the nine countries that are part of the initiative. For Colombia, there is room to increase reliance on public-private partnerships and to give public enterprises a sufficiently commercial orientation that would attract increased investments in priority areas.
"Finally, I welcome Colombia's continuing active fight against money laundering and the financing of terrorism. Colombia is part of the IMF's action plan in these areas which should help improve the investment climate.
"We at the IMF support the government's economic program and President Uribe's vision for the future of Colombia's economy. We are confident that the authorities will meet the challenges facing Colombia, and we wish the country every success", Mr. de Rato said.
IMF EXTERNAL RELATIONS DEPARTMENT