Gooooooooool Duque: Investors cheer on Colombia

Author Patricia Garip, Editor

Colombians donned in yellow are mourning their football team´s loss to Japan today, but many are still celebrating the decisive victory of conservative candidate Iván Duque over former guerrilla Gustavo Petro in Sunday´s presidential election.

Colombians donned in yellow are mourning their football team´s loss to Japan today, but many are still celebrating the decisive victory of conservative candidate Iván Duque over former guerrilla Gustavo Petro in Sunday´s presidential election.

Now comes the hard part.

Duque´s diverse supporters, who range from oil and coal industry executives to rural victims of the country´s long-running violent conflict, have high expectations for their president-elect.

His resounding victory with 54pc of the vote could buy him some extra honeymoon time after he takes over on 7 August from two-term moderate incumbent Juan Manuel Santos. Higher oil prices will help too. And despite its shortcomings, a 2016 peace agreement with former guerrilla group Farc has brightened the outlook for investment, with newer sectors such as tourism and renewable energy starting to turn heads.

But security remains a chronic challenge, which is why many Colombians back Duque. As the youthful protégé of Alvaro Uribe — the influential former president who cracked down on guerrilla violence during his 2002-10 rule — Duque is seen by his supporters as the best chance for peace and justice for victims. He has pledged to toughen the terms of the peace deal that many feel are too soft on Farc leaders looking for a new life in politics.

Oil companies pine for lower taxes and a firmer hand to revive exploration and production by mitigating operating risks that have menaced pipelines and oil fields for decades. But even if the government before or after the August transition is able to forge a new ceasefire with the remaining guerrilla group ELN, tackling persistent community protests and burgeoning coca cultivation requires policy changes that go beyond traditional contentious remedies, such as royalty redistribution and aerial spraying. And the ELN, Farc dissidents and criminal groups, many harbored in Venezuela and Ecuador, will be tough to root out as long as drugs remain the most lucrative game in town. Add to this mix a rising wave of Venezuelan migrants, topping 1mn over the past year by some estimates, and the scenario is complicated even for the most seasoned politician.

Seasoned Duque is not, at least not compared with his vice president-elect Marta Lucía Ramirez, a former minister of defense and international trade going back to the 1990s. The 41-year-old incoming president, a former senator and official at the Inter-American Development Bank, will likely try to differentiate himself from his mentor Uribe by finding a middle ground on security — less of Uribe´s stick, but less of Santos´ carrot too.

Duque´s top economic advisor and the man leading the transition is Uribe´s former finance minister Alberto Carrasquilla. His appointment should calm investors and ensure a smooth handover from respected current finance minister Mauricio Cárdenas. The rest of Duque´s cabinet is expected to be a combination of veteran politicians and young newcomers like himself, underscoring his promise of a generational shift.

One of the Santos administration´s final economic achievements is Colombia´s entry into the OECD. Membership should help the Duque administration to deepen trade ties and shore up institutions battered by corruption that has thwarted critical infrastructure projects. Among his priorities will be to accelerate economic growth and show strides toward diversifying Colombian exports away from commodities.

Economic diversification was among Petro’s top campaign pledges. The emboldened opposition leader, who on Sunday night darkly conceded his loss “for now”, promises to be a relentless political force on the left. Duque’s success in containing him will be determined not by GDP growth or oil rig counts or trade data, but rather by the degree of hope that Colombians feel about their future. For now, they are all wearing yellow shirts, united in their hope for a win in next Sunday’s football match.  

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