Reality Bites: New Colombian President Faces Backlash Over Reforms

University students take part in a demonstration demanding budget increase for the Colombian tertiary education, in Bogota, on November 28, 2018.

Source JUAN BARRETO/AFP/Getty

Why you should care

Iván Duque is finding it’s harder to implement tough plans than it is to promise them. 

When Iván Duque was sworn in as Colombia’s president in August, hopes for his government were high. A fresh-faced 42-year-old with years of experience at the Inter-American Development Bank, Duque was one of several pragmatic center-right leaders to win power in Latin America as the leftist “pink tide” of the past decade retreated.

He pledged to cut taxes and red tape, invigorate the country’s creative industries, tackle a rise in cocaine production and take a tough stance against the dictatorship of Nicolás Maduro in neighboring Venezuela.

But three months on, and despite a relatively steady economy — with inflation within the central bank target at 3.3 percent and growth of about 3 percent expected next year — Duque is finding governing the country far harder than winning the election. His tax reform plan has been ripped apart in Congress, students have taken to the streets calling for more money for higher education and, like other countries in the region, Colombia is struggling to deal with a massive influx of immigrants fleeing Venezuela.

After three months we’re asking, what is [the] focus? So far the government has just been fighting fires.

Juan Carlos Garzón, Ideas for Peace Foundation 

In September, Duque backed a referendum on proposals aimed at combating corruption, but low turnout meant it failed to garner enough votes for approval. Since then, he has struggled to push alternative anti-graft measures through a fragmented Parliament composed of more than a dozen parties. The president’s conservative Democratic Center (DC) party commands only about a fifth of the seats and relies on other center-right parties for support.

To add to his difficulties, Duque has alienated many within the DC who opposed his tax reforms.

“We support President Duque and his government, but that doesn’t mean that as a bloc in Congress we’ll abandon our duty to debate and propose alternatives to things we don’t agree with,” says María del Rosario Guerra, one of the DC senators who has opposed the tax plan.

 

As a result, there is a sense of drift in Bogotá. “The president keeps saying we need to unite and work together for Colombia,” said Sergio Fajardo, one of Duque’s rivals in this year’s election, in a recent radio interview. “The problem is, we don’t have a clue what we’re supposed to be uniting around.”

Colombians have punished this lack of focus in opinion polls. One of the latest showed Duque’s popularity had crashed from 54 percent to 27 percent in two months. Some 74 percent of people feel things are going badly. Using historical data compiled by Gallup, local consultancy Colombia Risk Analysis said that at the landmark 100 days in power, Duque was by far the most unpopular Colombian president of the past quarter-century.

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Colombian President Iván Duque delivers a speech during the graduation of new cadets in Bogotá on Nov. 27, 2018.

Source JUAN BARRETO/AFP/Getty

His biggest setback has been the demolition of his tax plan. Duque wanted to cut value-added tax from 19 to 17 percent while expanding it to cover more basic foodstuffs. Economists broadly welcomed the plan as a way to raise the equivalent of 1.1 percent of gross domestic product in extra revenue and help cut the fiscal deficit.

But the tax cut element of the proposal was poorly communicated and the plan was deeply unpopular among parliamentarians, who feared it would lose them votes. Lower-income and middle-class voters interpreted it as a “tax on the poor.”

Duque was forced to back down. “Only a diluted version of the bill will be approved by year-end, with revenue gains likely falling below expectations,” says María Luisa Puig, analyst at the Eurasia Group.

The resulting shortfall could jeopardize the state’s target of cutting the fiscal deficit from an estimated 3.1 percent of gross domestic product this year to 2.4 percent next.

“If the centerpiece of the reform — an expansion in the VAT coverage — is scrapped, spending cuts (or tax hikes) will be needed instead,” Capital Economics warned in a note to clients.

Few doubt Duque’s ability. Seen as charming and intelligent, he is an eloquent public speaker and has a formidable memory for detail. He is also a relatively conciliatory figure in a polarized region.

After just three months, he can hardly be expected to have found definitive solutions to Colombia’s long-standing problems, including guerrilla violence, organized crime and drug trafficking. But his government was expected at least to have come up with a plan to tackle them, analysts say.

“You can’t blame everything on the government, but after three months we’re asking, what is its focus?” says Juan Carlos Garzón of the Ideas for Peace Foundation (FIP), a Bogotá think tank. “What’s the plan for the medium and long term? So far the government has just been fighting fires.”

FIP published a report on Duque’s first 100 days in office that found the murder rate had climbed 5.5 percent compared with the same period a year ago and the number of people displaced by violence had risen 21 percent. Popular protests, including large student demonstrations, had jumped 59 percent.

The think tank also said Duque’s plan to use drones to eradicate coca plantations was proving impractical, just as Washington is growing increasingly impatient with Colombia’s failure to tackle cocaine production. U.S. President Donald Trump had been due to visit Colombia this week but has canceled his trip.

Duque has won some praise for refusing to negotiate with the National Liberation Army that, following the 2016 peace deal with the FARC, is the country’s largest guerrilla group. He has said he will not talk to the organization until it ends all criminal activities. Under pressure from the United Nations and the European Union, he has also largely continued to implement the FARC deal despite courting right-leaning voters during the election campaign by hinting he might seek to roll back parts of it.

With nearly four years left to serve, Duque has time to turn things around. But given the scale of Colombia’s challenges, he needs to start soon.

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By Gideon Long

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