Colombian business leaders on
Tuesday called for a cut in interest rates and an increase in
public spending to help ward off an economic slowdown they fear
could be triggered by the global financial crisis.
Colombia’s ANDI association of major private industries,
which has called for the central bank to stimulate growth, said
it expects increasing difficulties in foreign financing,
especially for infrastructure projects in the Andean country.
“If we do not prepare better for the hit from the financial
crisis on Colombia’s economy, then the economy could fall into
recession,” ANDI President Luis Carlos Villegas said.
“We have high interest rates and globally the trend is to
lower them,” he told reporters.
Colombia’s central bank meets on Friday to decide monetary
policy and analysts expect it to keep its benchmark rate at 10
percent. But forecasts for a later cut are increasing though
the board has been reluctant because of inflation pressures.
Colombia’s exporters are heavily reliant on demand from
markets in the United States and neighboring Venezuela, where
falling global oil prices could crimp domestic consumption.
The government has already taken a series of measures to
improve liquidity and secured financing for next year. It
recently cut its 2009 growth forecast to 3 to 4 percent from a
previous target of 5 percent due to the world crisis.