Colombia’s New President Has No Honeymoon

(Bloomberg Opinion) -- Grace periods are brief in Colombian politics. The same week that then-President Juan Manuel Santos bagged the Nobel Peace Prize for his efforts to end the world's longest shooting war, Colombians rejected his peace plan. The plan survived, but the funk over its failings helped to elect conservative Ivan Duque, who is unlikely to catch a break.

The economy is weak, corruption runs deep and although Colombia may no longer be a country at war, it is hardly at peace. As Duque was sworn in Tuesday, guerrilla holdout groups staged four separate attacks in the countryside -- a sharp reminder that cocaine trafficking and violence are soaring in areas once thought cleansed of conflict.  

In addition to a cranky home crowd, Duque also faces big challenges from foreign friends and neighbors. Start with the emergency next door. Duque takes office as Venezuela's economic implosion has sent nearly a million refugees over its shared border, spreading indigence and despair and vanquished diseases like measles. “Duque has promised to reduce taxes and public expenditures, and still deal with the refugee crisis,” Aristodimos Iliopulos, of the Economist Intelligence Unit, told me. “It’s going to be hard to square that circle.”

There’s reason to believe Duque can hold the line. For all the ill will over Santos’s patchy record, Colombia is in better shape. After two lackluster years – including a long-running rout for equities and the first debt downgrade by a ratings agency in 15 years – the economy is picking up.

Both the trade and current account deficits are narrowing, inflation is low, and oil prices have notched up again. Foreign investment is climbing, even as it slumps in the region. “Colombia has grown below potential since the commodity crash after 2014,” said Carlos de Sousa, a senior analyst at Oxford Economics. “We expect a cyclical upturn, with 2.6 percent growth in 2018, increasing to 3.4 percent next year. That should add jobs.”

With strong commercial ties to the Asia-Pacific region, Colombia also may even cash in on an eventual trade war between the U.S. and China. But those gains may be partly offset by weaker growth in China and rate hikes by the U.S. Federal Reserve, which could siphon away foreign capital. “The question is if Duque can fortify the economy before the global slowdown,” said Iliopulos.

An even tougher question might be how to navigate relations with a distracted Trump administration, better known for its Twitter fiats than a laser focus on hemispheric affairs. “My gut feeling is that while continuing to strongly back Colombia, the U.S. will demand results,” said Iliopulos.

The agenda could include calls to return to the hugely unpopular aerial spraying to destroy coca, still Colombia’s biggest cash crop. Then there’s Washington’s Venezuela itch. “It’s no secret that the U.S. would like to see the end of the Venezuelan regime,” said Iliopulos. Recall the recent talk by administration officials touting the Monroe Doctrine and comparing Trump to Teddy Roosevelt, both remembered in the region as heirlooms of imperialism.

Pushing too much on either front to please its alpha ally could cost Duque political capital he can ill afford to squander. “There’s uncertainty in the region and the world, Washington is in chaos, and now comes the risk of re-narcotizing relations with the U.S.,” said Michael Shifter of the Inter-American Dialogue. “This is going to be difficult terrain for Duque.”

Fortunately for Duque, notwithstanding the political divisions reflected in his slim congressional majority, Colombia is not about to slide back into civil war. Part of that owes to the demographic earthquake that has turned Colombia into an overwhelmingly urban country: Despite the spike in crime and cocaine, the countryside is no longer the bellwether for wellbeing it was when the continent’s most fearsome insurgents made their stand there. 

Yet Duque cannot afford to snub the hinterlands, either. Traversed by oil pipelines, roads and mineral deposits, they remain home to farmers who bore the brunt of half a century of war and are still waiting for the vaunted peace dividend. “Ignoring rural populations can come back to bite you,” said Shifter.

Eduardo Moncada, a political scientist and scholar of Latin American security and violence at Barnard College, agrees. “Post-conflict Colombia is in a new, more complicated phase. The lines between politics and crime, and countryside and city, have become blurred, and attacking the social drivers of violence is a lot messier and slower,” he said. “Iron-fist policies grab headlines and may be good politics, but they fall short.”

That’s a caveat Duque must keep in mind. The Colombians certainly will.  

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

Mac Margolis is a Bloomberg Opinion columnist covering Latin and South America. He was a reporter for Newsweek and is the author of “The Last New World: The Conquest of the Amazon Frontier.”

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