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The economic emergency: an insufficient solution La emergencia económica: una medida inconclusa

By Lorente Luis

Abstract

There are many reasons for the Colombian recession that began in 1995, but the disagreement between fiscal and monetary authorities is an outstanding one. Monetary measures against inflation promoted high interest rates, made real investment more risky, rocketed the exchange rate, attracted foreign capital and elevated public debt costs.&lt;br /&gt;Emergency measures announced early in the year were insufficient because the problem comes from old and needs long range measures. Balanced budget is a valid target, but along the economic cycle and not in each fiscal year. Reduction of public expenses or public debt must be applied in periods of growth and not when taxes go down because a recession has begun. Monetary policy must allow for anti-cyclical measures and can do it effectively by controlling the volume. of credit accessible to the Government, or to finance private construction of public works, or to those that will buy the facilities and services that get privatized.<br>La fase recesiva de la economía colombiana que comenzó en 1995 tiene varias causas, en especial, el desacuerdo entre políticas fiscales y monetarias. Las medidas antiinflacionarias elevaron las tasas de interés y dificultaron la inversión, y provocaron la revaluación de la moneda, la promoción de la entrada masiva de capital externo y del encarecimiento del servicio de la deuda pública. Las medidas de emergencia anunciadas a comienzos de 1995 no fueron suficientes: se necesita una política con objetivos de largo plazo. Hay que buscar un balance fiscal a lo largo del ciclo económico y no en cada año fiscal; la contracción del gasto público debe aplicarse en las fases de auge económico y no cuando caen los recaudos porque ya comenzó una recesión. La política monetaria debe permitir medidas anticíclicas y puede contribuir a ellas si regula el volumen de crédito accesible al Estado, a sus contratistas y a quienes adquieren prvatizaciones

Topics: Desacuerdo, política fiscal, monetaria, tasas de interés, inversión, moneda, capital externo, deuda publica, balance fiscal, recesión, crédito, contratistas, privatizaciones, Economic history and conditions, HC10-1085, Social Sciences, H, DOAJ:Economics, DOAJ:Business and Economics
Publisher: Universidad Nacional de Colombia
Year: 1997
OAI identifier: oai:doaj.org/article:5390c8be18a54228a221f8c261881afd
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