Colombia-Ecuador

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  • ECONOMIC OVERVIEW: COLOMBIA

    23 July 2009 Hits: 155

    The finance minister, Oscar Zuluaga, has denied that the economy has gone into  recession even though it has registered two consecutive quarters of negative year-on-year growth according the national statistics institute (Dane): -0.6% in the first quarter of 2009 and -1% in the final quarter of 2008. Zuluaga noted that real GDP rose 0.2% quarter-on-quarter, however, between the fourth quarter of 2008 and the first quarter of 2009. The debate over the niceties of what constitutes a recession is academic. The economy is not in good shape - industrial output fell by a sizeable 7.9% year-on-year in the first quarter - but there are positive signs. Buoyed by an increase in the value of oil and gas exports, the mining and hydrocarbons sector bounced back to expand by 10.6%. Construction, boosted by government spending, was up 4.1%. Any recession would be the first for a decade. Zuluaga is confident that the economy will pick up in the second half of 2009, and said he felt no need to revise the government's growth forecast down from 0.5%-1.5%. One cause for concern, however, is that urban unemployment is on the increase: it rose to 14.9% in January, its highest level in three years.

    Inflation: In June the consumer price index fell by 0.86%, having risen 0.01% in May. For the first six months the accumulated rate was -0.78%. The annual rate in June was 2.74%, well down on 7.67% in calendar 2008.

  • FOREIGN RELATIONS: Deteriorating relations on two fronts

    23 July 2009 Hits: 193

    Relations between Colombia and Ecuador, sundered by Colombia's attack on a Fuerzas Armadas Revolucionarias de Colombia camp inside Ecuador on 1 March 2008, are getting even worse. Colombia is now claiming that it has corroborating evidence that President Rafael Correa's successful election campaign in 2006 was backed by the Farc. The other row is over trade barriers. Ecuador is accusing Colombian exporters of exploiting the advantage their weaker currency gives them in Ecuador's dollarised economy.

    Ecuador's president, Rafael Correa claims that the corroborating evidence, from another video retrieved from a computer seized by the Colombian authorities is a fabrication. The Colombian government seems pretty sure of itself. On 19 July it gave copies of the video to the Organization of American States (OAS) and Interpol.

    On the video one of the Farc's seven-person leadership group, Jorge Briceño Suarez (alias Mono Jojoy), states, as he reads what the Colombian press has termed the last will and testament from the Farc's founder, Manuel Marulanda, that the Farc made contributions to Correa's 2006 presidential campaign. Briceño's statement is the first time a senior Farc figure has said, apparently, that the group financed Correa.  

    The OAS secretary general, Jose Insulza said that the video warranted further investigation. So did a former Colombian president, Ernesto Samper. He called for the Colombian government to send a copy to Ecuador. Lucio Gutiérrez, a former president whom the Farc says entertained its representative when he was president (2003 to 2005) and who lost to Correa in the most recent presidential elections on 26 April, immediately called on Correa to resign and face prosecution. The Colombian government finally sent the video to Ecuador on 21 July.

    Correa dismisses the “evidence" as another attempt by right wingers to try to destabilise his government and all progressive governments in the region. Correa said, carefully, that he personally had nothing to do with the Farc. He claimed that he could just as easily say that there was evidence that President Alvaro Uribe was financed by right wing paramilitaries and drug traffickers.

    Colombia's national TV networks broadcast the video on 17 July and it is now available on YouTube. In it, Briceño appears to be addressing Farc troops following the death of the group's founding leader, Manuel Marulanda, on 26 March 2008. In the video, apparently recorded on 27 March 2008, Briceño reads a letter from Marulanda which refers to the seizure of a lap top in the 1 March 2008 attack on the camp inside Ecuador. The letter acknowledges that the seizure revealed various Farc secrets, including “aid in dollars" given to Correa's campaign and “subsequent talks with his emissaries, including some agreements".

    Colombia's attorney general, Mario Iguarán, said that the video was found by police on the computer of a Farc operative, known as “Adela", who was arrested in Bogotá in late May 2009.

    On the trade side, Ecuador has slapped new import taxes on 1,346 'luxury' items, imported from Colombia. These include cars, clothing, alcoholic drinks, pet food, makeup, ceramics and others. The bulk (89%) will be taxed at between 20% and 30%. Under Andean Community (CAN) rules, member states can take temporary measures to address exchange-rate derived trade imbalances.

    • Santos arrest warrant

    On 8 July Ecuador's attorney general, Washington Pesántez, applied for an Interpol 'red notice' requesting the provisional arrest (with a view to extradition) of the former Colombian defence minister, Juan Manuel Santos, for his alleged responsibility for the death of an Ecuadorean citizen in the 1 March 2008 bombing of a Fuerzas Armadas Revolucionarias de Colombia (Farc) camp inside Ecuadorean territory. Interpol has not granted the warrant so a provincial court in Sucumbí­os, Ecuador, has issued a local arrest warrant for Santos, on murder charges.