Colombia hopes to boost
flagging sales of cars and home appliances by supplying nearly
$200 million in consumer loans, part of efforts to stave off
the global slowdown, President Alvaro Uribe said on Friday.
The measure is similar to credit-boosting steps taken in
other South American countries where governments are trying to
prop up the consumer spending that has played a key role in
the economic expansion of recent years.
Colombia’s industry output plunged 9.2 percent in December
and unemployment is rising, causing concern in the government
and casting doubt on its target for 3 percent growth.
“We’ve seen a big deterioration in the automobile and
parts industry and in sales of domestic appliances,” Uribe
said in a televised speech.
He said the state development bank Bancoldex would supply
the loans, which will have longer repayment terms and lower
interest rates, for the purchase of Colombian-made, small cars
and domestic appliances.
General Motors, Ford and Renault
operate assembly plants in the Andean country, but sliding
sales have led them to cut workers’ hours.
Colombia’s automobile industry has been hit by neighboring
Venezuela’s decision to slash import quotas as well as a hike
on import duties by Ecuador.
Argentina and Brazil, leading regional carmakers, have
already introduced schemes to reduce the cost of borrowing for
consumers and Brazil’s car sales rose for a third straight
month in February.
Colombia’s car industry produced about 200,000 vehicles
last year, but the government hopes to increase annual
production by 7,000 vehicles. Sales of automobiles fell 13.2
percent in 2008 to 219,948 vehicles. (Reuters)