Page 16 - MONTT LATIN AMERICAN MAGAZINE, DECEMBER, 2021

Colombia: A Year of Definitions Begins
Two major elections will be held this year in the country, to renew Congress and elect a new President of the Republic. At the level of local and international investors and businessmen, there is concern about the eventual triumph of the leftist candidate and former guerrilla, Senator Gustavo Petro.
Colombian Economy
This will be a very active year from the electoral point of view for Colombia that will be inaugurated on March 13th when citizens elect their next Congress. Exactly 108 senators will be renewed, of which 100 are nationals, two from a special indigenous constituency, five representing the Comunes party (founded by ex-combatants of the Revolutionary Armed Forces of Colombia - People’s Army), and a remaining senator who will be the candidate for the Presidency of the Republic who occupies the second place in the elections to choose Head of State.
In the House of Representatives, 188 parliamentarians will be defined, of which 161 correspond to the 32 departments and the Capital District, two for the constituency of the Afro-descendant communities, one for the indigenous communities, one for the Raizales (a Protestant Afro-Caribbean ethnic group) of San Andres and Providencia, and one for the international constituency. The number will be completed with 16 representatives of the victims of the conflict, five from the Comunes party, and a last seat that is awarded to the Vice-Presidential formula that occupies the second place in the elections of Head of State.
The presidential elections will be held on May 29th, and in it the President and Vice President of the country for the period 2022- 2026 will be chosen. The winning formula must obtain half plus one of the total valid votes, otherwise a second round will be held on June 19th, 2022 between the two candidates with the highest vote. The successful candidate will govern for a single four-year term.
Candidate of the Left
The National Administrative Department of Statistics of Colombia, confirmed that last year 2,8 million people fell into extreme poverty, earning less than US $ 38 per month. According to the OECD, it would take 11 generations for the descendant of a poor Colombian family to reach “average income” levels in the country.
According to the analysis of FTI Consulting, one of the largest and most important financial consulting firms in the world based in Washington DC: “The recent devastating impact of Covid-19; the old ailments of inequality; violent crimes; inadequate state control and endemic corruption in Colombia created a real and atypical opportunity for a leftist candidate in the next elections ”.
The company adds that: “The current socio-political and economic volatility in Colombia worries foreign investors (...) Petro, a figure that generates the greatest concern in the local and international business sector, is the main candidate. Although it had a noticeable decline in voter sentiment in the most recent Invamer poll, it is nonetheless true that dissatisfaction with the status quo, the inevitable resumption of protests, and the overall levels of inequality and poverty plaguing the country today they continue to create the conditions under which Petro could easily be propelled into a second round in the presidential elections. “
This would be a surprise because according to the history of that country, Colombia is the only country in South America where the democratic left has never governed. The political centre and the right have exercised power throughout the republican life of the nation.
Minimum Wage and Double Taxation
On the other hand, as established in Decree 1.724 of December 15th, 2021, the legal minimum wage for the year 2022 in Colombia was set at one million pesos per month as of January 1st, 2022, which represents an increase 10,07 percent compared to the previous year.
This increase also applies to workers who earn a comprehensive minimum wage, who as of January 1st, 2022 will not be able to receive an amount less than $ 13,000,000.
On the other hand, the Agreement to eliminate double taxation on income and wealth taxes was signed between Colombia and Uruguay. In this way, the two countries reiterate their commitment to develop their economic relations in order to promote the exchange of goods and services, incentive investment flows and increase the competitiveness of economic actors. Likewise, the agreement contains mechanisms that will allow Colombia to and Uruguay can combat tax evasion and avoidance more effectively,prevent abusive use of the treaty, and strengthen cooperation between tax administrations.
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