Colombia’s Finance Minister Diego Guevara may resign amid disputes with President Gustavo Petro over budget cuts, though the finance ministry denies this. The potential change raises concerns about fiscal stability and monetary policy. The peso has already reacted negatively, falling against the dollar.
Colombia’s Finance Minister, Diego Guevara, is reportedly set to depart from his position due to disagreements with President Gustavo Petro, as indicated by local media and a palace source. Meanwhile, the finance ministry stated it lacks official information concerning this matter but promises to update when available. Guevara has held the finance minister position for just over three months after previously serving as vice finance minister.
Reports suggest that the disagreements occurred over budget cuts, leading Guevara to resign on Monday night. However, sources from Petro’s office assert they lack confirmation of this resignation, indicating that Guevara remains in his position. Local radio Caracol announced that Grupo Bicentenario’s head, German Avila Plazas, is expected to succeed Guevara.
The potential departure of Guevara raises concerns about the stability of Colombia’s public finances. Analysts at Banco de Bogota have expressed that ongoing cabinet changes and the profile of the incoming minister may lead to further political and economic instability. They cautioned that Avila may lack the necessary experience to handle the fiscal challenges ahead.
Additionally, this situation casts doubts on the anticipated cuts to the central bank’s interest rates expected by the end of March. Following this news, the Colombian peso depreciated by 1.08%, trading at 4,118 per dollar. Guevara had also mentioned earlier this month that the government might delay 2025 budget spending due to ongoing financial difficulties.
In summary, Colombia’s Finance Minister, Diego Guevara, is facing potential departure amid disagreements with President Petro over budget issues. The finance ministry has denied confirmation of his resignation, while analysts warn of increased economic instability. The situation has prompted concerns about the capability of a potential successor, further impacting monetary policy and the value of the Colombian peso.
Original Source: theprint.in
