In spite of its solid economy, Colombia will recover slowly from its recession due to its dependence on the economies of Venezuela and Ecuador, who show little or no growth, the IMF says.
Nicolas Eyzaguirre, the Director of the IMF’s Wester Hemisphere Department, says that although Colombia, Chile, Peru, and Brasil are the nations that will have the quickest recovery from recession in Latin America, Colombia’s rebound will be slower than the recovery of the other three nations.
“Unlike other countries that are also raw material exporters and benefit from the Asian demand, for Colombia the forecasts are less auspicious because part of its trade depends on economies that have growth problems like Venezuela and Ecuador.”
In 2010 Colombian economy will grow 2.5%, while Ecaudor will grow 1,5%, and Venezuelan economy will fall 2% and its growth will be -0.4%.
Eyzaguirre also said the IMF approved a US$ 10,5 billion loan to Colombia because it has a solid economy. The loan money has not been disbursed, but it is at the disposal of the Colombia government at the moment Colombia requieres it.
“Colombia has implemented an appropriate fiscal stance, but it has to continue its adjustments in its tax structure and it has to bring more clarity on its future fiscal framework,” Eyzaguirre said.
Colombia exported US$ 616 million to Ecuador in the first seven months of 2009, and exported US$ 6 billion in food, live animals, clothing, and cars to Venezuela in 2008.
The IMF did not mention the consequences of Venezuela’s intended trade boycott of Colombian products.