Development: On 11 September Colombia’s President Iván Duque offered his full support to his finance minister, Alberto Carrasquilla, in the face of the allegations of impropriety levelled against him.
Significance: Carrasquilla is one of the more influential ministers in the new government led by Duque. But he may prove to be the cabinet’s first casualty following the publication of reports in the local media implicating him in the infamous ‘Panama Papers’ international tax avoidance revelations.
- Carrasquilla’s problems began on 9 September when Semana, a local weekly, published an investigative report linking the new minster to the Panama Papers scandal. According to Semana, Carrasquilla’s name appears in the leaked Panama Paper documents and he is identified as a partner at a Panama-registered firm, Navemby Investments Inc, that bought bonds issued by Colombian municipalities to raise funds for public services (known as ‘water bonds’).
- The Semana report claims that Carrasquilla and another partner also founded Konfigura Capital, a consultancy firm that advised 117 Colombian municipalities on how to issue water bonds. According to the report, under the scheme Carrasquilla, who had promoted the use of the water bonds when he was last finance minister in 2003-2007, and his partners received tax-free profits equivalent to some US$4.5m at the expense of Colombian municipal governments.
- Carrasquilla has rejected the allegations. He argues that he acted as economic advisor to Navemby and that in this role he tried to promote investment in Colombia. The minister also denies having broken any laws or illicitly benefited from the scheme. However, Carrasquilla’s explanations have failed to wash with the political opposition. Indeed, legislators from the leftist opposition Polo Democrático Alternativo (PDA) party have called for Carrassquilla to be censured by congress and have presented a motion to this effect.
- Yesterday, President Duque addressed the issue for the first time and backed his minister. “I fully trust in the minister and believe that he is an honest person…I think that yesterday he provided a clear explanation”, Duque told reporters when asked about the case during a press conference.
Looking Ahead: Carrasquilla has been invited to appear in congress on 18 September to clear up the allegations levelled against him before the motion to censure him is debated. Carrasquilla’s appearance before congress could prove to be determinant for his future.
