02 Oct Challenges Ahead for Colombian President Iván Duque
In August 2018, Iván Duque of the Centro Democrático Party was elected as President of Colombia promising economic growth, lower corporate taxes, and a tougher stance on the FARC guerrillas and the Venezuelan government. Even though he won a majority of the popular vote, President Duque still faces considerable opposition in Congress and throughout Colombia, mainly stemming from his controversial political mentor: former President Álvaro Uribe. After his first month in office, President Duque and his administration announced various measures in foreign, domestic, and economic policy that signal potential change, but not without controversy.
Last month, President Duque announced that he intends to officially withdraw Colombia from the Union of South American Nations (UNASUR). UNASUR, founded in 2008, was the brainchild of late Venezuelan President Hugo Chávez, for whom it was mainly a political mechanism to decrease US influence in the region. With the end of Socialist governments and the rise of center and right-wing politics across Latin America, however, UNASUR became virtually useless due to intense political divisions within the organization. From Madrid, where he met with various international leaders, the President called UNASUR an “echo chamber” of the Venezuelan dictatorship, a sentiment echoed by many critics of the union. In April of this year, Colombia along with Brazil, Argentina, Chile, Paraguay, and Peru indefinitely suspended their membership in the organization. Now that Colombia will exit UNASUR, it remains to be seen whether other countries will follow suit. Meanwhile, Venezuela, along with Bolivia, Ecuador, Uruguay, Guyana, and Suriname remain in UNASUR.
When Duque was elected, the continuation of the FARC peace agreement as well as the fledgling peace process with the ELN, now Colombia’s largest guerrilla group, was called into question. While Duque has committed to maintaining the FARC peace agreement, the process has been moving very slowly and former FARC guerrillas have returned to criminal activity. Meanwhile, the process with the ELN reached a breaking point after President Duque threatened to withdraw from the negotiation table if the guerrillas continued kidnapping civilians. The ELN has called these conditions unacceptable, which raises fears that both sides will suspend negotiations.
Throughout the campaign, Duque promised to lower corporate taxes in order to spur investment and job creation. However, the controversy is how the government will replace the reduced income. Finance Minister Alberto Carrasquilla proposed an increase in the number of people required to pay taxes as well as an increase in taxes on individual taxpayers. This proposal was rejected by many members of Congress, and ultimately by President Duque himself. The Duque administration must figure out how to supplement the tax revenue lost by the significant reduction in corporate taxes, especially as Colombia’s overall fiscal situation continues to worsen.
The next few months will be key in President Duque’s push to change Colombia’s economic model. The support of Congress, in which Duque’s coalition does not have a strong majority, is necessary for Duque to implement his policies. The administration of his predecessor, Juan Manuel Santos, struggled greatly due to a lack of support in Congress towards the end of his second term. By working with parties outside the coalition, Duque and his allies hope that they will succeed where Santos did not.