Colombia’s economy should stage a recovery in the second half of the
year and return gradually to a path of sustained growth, an official
from the International Monetary Fund said Friday.
“A recovery is expected for the second half, as the global economy
starts to pick up and countercyclical policies take effect,” Marco
Pinon, advisor in the IMF’s Western Hemisphere department, said
following a mission to Bogota for a semi-annual visit.
Inflation will also likely fall to around 4% due to weak demand and the pullback in food prices, he said.
Colombia’s economy contracted 0.6% in the first quarter, while
annual inflation has fallen to 4.77% through May from 7.67% at the end
Pinon praised Colombian authorities for their response to the
global crisis, by securing external financing early on, easing monetary
policy and allowing automatic fiscal stabilizers to work.
“Looking into 2010 and the medium term, staff believes that
Colombia should be in a position to gradually resume sustained growth,
and reduce its fiscal deficit and public debt,” he said.
The government should take advantage of any improvement in global
growth or commodity prices to further strengthen fiscal policy, he
added. (Dow Jones)