Colombia’s economy will begin to recover in 2021

Significance

This partial revival, fuelled by an increase in household consumption, nevertheless fell short of offsetting the devastating effects of the strict COVID-19 lockdown measures imposed in the first half of the year. The economy closed 2020 with a 6.8% contraction, according to the latest figures published by the national statistics agency.

Impacts

• The Central Bank will maintain its accommodative stance to support economic recovery; inflation expectations remain well anchored.
• The weakness of the ruling coalition in Congress will see Duque struggle to advance his agenda.
• Protests will resume as restrictions ease and the government ends financial support measures delivered over the last year.