Duque’s victory: Hope and fear for Colombia’s future

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Colombia's new president Iván Duque

Iván Duque, the leader of the Democratic Center (Centro Democratico-CD) party was elected president of Colombia, in line with the traditionally politically conservative spirit of the country. Gustavo Petro, extreme reformist and former member of the leftist revolutionary group M-19, lost the second round of the vote, failing to become the first leftist president in Colombia’s history. Nevertheless, despite his defeat (by a large margin of 41.8% to 54%, as also the blank votes are counted), Petro has already made history by getting as far as the presidential runoff: leftist candidates are often victims of targeted political violence or enjoy only marginal public support in the country. 

The recent elections in Colombia are of particular significance as they took place after the historic peace agreement between the Revolutionary Armed Forces of Colombia – People’s Army (Furezas Armadas Revolucionarias de Colombia – Ejército del Pueblo; FARC-EP) and Juan Manuel Santos’ Government. In this crucial electoral cycle, the choice of government was not just between two political parties, but between two polar opposite views on the country’s future. The last time Colombia held such a divisive electoral campaign it resulted in the death of Jorce Eliécer Gaitàn, a populist hard-left candidate who was close to winning the 1948 elections before getting shot in Bogotà.

Land reform, coca cultivation and peace

The recent electoral campaign was almost entirely focused on the controversial reconciliation with the FARC-EP, which followed the peace agreement of June 2016. Colombia has yet to implement the terms of the peace agreement, which represents the most difficult phase of the reconciliation process. Despite a fast track mechanism which allowed quicker approval of a number of reforms connected to the peace agreement between 2016-2017, the institutional reforms have been implemented only partially thus far, leaving key issues unresolved.

Among the list of outstanding issues, agrarian reform and land ownership rights are arguably the most important. Not only because FARC’s long ideological struggle is rooted in rural Colombia, but also because agrarian inequality and rural underdevelopment have fostered the persistence of violence in the country.

Historic imbalances in rural Colombia caused the country to have one of the highest percentages of land-ownership concentration in Latin America, with only 0.4% of Colombian farms owning 67.6% of the country’s productive land. At the same time, 40.3% of the rural population is poor; 7 million live below the poverty line and 2 million are living in extreme poverty.

As a result of the peace agreement, the Comprehensive Rural Reform (Reforma Rural Integral – CRR) was created to address land-ownership concentration. The policy is a number one priority in the deal and comprises three broad measures: redistributing land, protection ownership rights and developing infrastructure and basic services in rural areas.

CRR’s execution requires a strong commitment from the next government. Between 2017 and 2031, the overall investment for CRR’s implementation will be around $148.3 billion, equal to an annual investment of $9.9 billion – or 1.14% of Colombia’s GDP in 2016. 36% of these funds will finance the development of public infrastructure in rural areas. Another 40% will be allocated to social inclusion policies such as access to clean water and healthcare. The remaining 4% is reserved for the substitution of coca production. 

However, the implementation of the CRR may be complicated by Duque’s victory. The CD party has been one of the main opponents to the peace agreement. Duque has campaigned to change key clauses of the agreement, including land reform terms. If he carries through on those promises, this could undermine FARC’s demobilization efforts and jeopardize chances of future peace talks with other revolutionary groups, such as the National Liberation Army (Ejército de Liberaciòn Nacional – ELN).

Colombian economy and the export of commodities

Another key issue Duque will need to deal with is Colombia’s slow economic growth. Colombia’s economy has not been performing well recently, despite relatively positive figures compared to other Latin American countries. The country’s annual GDP fell from $381 billion in 2014 to $314 billion in 2017. Annual GDP growth reached 2% in 2016 and 1.8% in 2017, but these figures remain unsatisfactory in comparison with the 4.8% average increase recorded between 2004 and 2014.

The Colombian economy has suffered under its heavy reliance on commodities. Lower oil prices on the international market have sent the commodity market into a tailspin, knocking down investments and, in turn, hindering new explorations. The oil industry is of crucial importance to the Colombian economy, accounting for 50% of its exports and 7% of its GDP. Between 2007 and 2015, Colombian oil production fell by 12% and its oil reserves depleted by 16.8%. Moreover, Colombia is predicted to lose its energy independency in 2021.

For the new president, Colombia has yet to fully exploit its resources and has the potential to increase national oil production exponentially. His central government will need to invest in oil infrastructure to reduce oil transport costs and provide incentives for offshore drilling. To re-balance the relationship between oil companies and local communities, Duque proposes to reform the royalties system, and thereby favor local communities with a 50-50 split between the State and Colombia’s regions. The President would then support the economic model based on extractive industries – such as oil and coal, the country’s top exports. 

However, focusing the country’s economic development solely on the mineral and oil sectors may have serious disadvantages. Firstly, it will not help to resolve structural issues, such as low productivity and unequal income distribution. What is more, it will only preserve the current social structure, which concentrates capital and investments in the two sectors. Third, it will maintain Colombia’s dependency on international markets and their volatility. Lastly, it will keep the Colombian peso strong, penalizing industry diversification and exports of other goods.

Colombia’s future, Petro’s legacy

The most relevant factor from the recent election is not Duque’s highly predicted victory. It is the polarization of the Colombian political spectrum. Petro’s widespread support in the presidential election – broader than usual for a leftist candidate – was intrinsically linked to the deep discontent of millions of Colombians with the country’s current socioeconomic system. Petro’s rhetoric emphasized the importance of addressing the deeply rooted social injustice and inequality which have been neglected for too long.

The risk for Colombia’s future is that Duque cement the status quo, leaving questions about the socioeconomic structure – which Petro laid bare during his presidential campaign – unanswered. Not responding to structural issues that affect the majority of the country may subject the country to dangerous political unrest, bringing historical tensions to the surface again.

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