Jaime Alberto Cabal, president of Fenalco, warned that Colombia is going through the most serious fiscal crisis in its history. He blamed waste and high government debt under the previous administration, and said the Gustavo Petro government had left public finances in a very poor state.
Cabal said the deficit and indebtedness were large enough that getting out would require effort from all Colombians. Otherwise, he said, the country could face bankruptcy with very serious consequences.
Savings and an austerity Pact
Cabal called for an Institutional Pact of Fiscal Austerity. He proposed savings of at least 20 percent in the budgets of several entities, starting in 2027.
He said the country needs firm commitment to austerity, spending efficiency, tax equity and transparency. The effort, he added, must be shared by all and be fair.
Opposition to the vehicle VAT increase
The government’s Ley de Rescate bill would raise VAT on hybrid and electric vehicles from 5 percent to 19 percent. Cabal opposed the change.
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He said the increase could discourage the purchase of cleaner technologies and cut against sustainability and energy transition goals. Congress is due to begin debating the bill.
Source: Fenalco
