Thursday, April 29, 2010

Mockus good for business?

So maladjusted hasn't done any scientific study on this, but the guess is that most casual observers would think the Colombian business community will support Santos in the upcoming election. It's not like Mockus' rise in the polls is rattling the markets or anything like that, but business generally likes continuity (and right wingers), not newcomers who dress up in super hero costumes and dispatch mimes to ridicule traffic violators. That said, one thing businesses like even more are profits. Currently, exports to Venezuela have collapsed (due to some testy relations, we'll say) and while the US has graciously stepped in (see the graphs below), the fact remains that Venezuela is right next door and even though they are pushing an FTA with the US, does Colombia really want to be EVEN MORE dependent on the US (just look at Mexico).

According to Reuters, "Colombia says the trade conflict could trim around one percent off its economic growth this year." That ain't no joke, especially not when your coming off this past year. The article also mentions that Colombia has relatively few exports to China compared to the rest of the region. So maybe to the extent that China takes the place of Venezuela that could be a good thing, but it seems the US is picking up most of the slack.

So this is where Mockus' statements about Venezuela come into play. During the presidential debate the other night Mockus stressed the need to separate relations with Venezuela from those with the US. This would be a serious break from the Uribe years in Colombia, where it seemed like their privileged relationship with the US was always put before everything else. Given that Colombia's neighbors aren't too thrilled with Santos, it seems pretty clear that Mockus would be the candidate most likely to repair relations with Venezuela and Ecuador. And who stands to benefit the most from that? Colombian exporters...

So maybe I'm over estimating the effect this is having, and how important this is for Colombian businesses (in which case let me know). Regardless, from everything I've read Mockus' economic policies would not differ much from Santos, and in any case it would be hard to argue that better regional relations would be a BAD thing for business.

(all images courtesy of Colombia's DANE)

1 comment:

  1. Also one to consider is that war is bad for most business. Unless you happen to be in the military industrial complex, which in this case the EE.UU. seem to have a lock on as far as Colombia is concerned. Since the right-wing has been in power, the war with FARC has not only intensified, it has spread to the right-wing paramilitaries and the "extrajudicial" (That is such an obviously phony word. Why not just come right out and say it is a government sponsored execution?) killings. But I digress.
    Mockus represents, or in some people's minds appears to represent. a change of tactics in dealing with Venezuela, Ecuador, Panama, but most importantly, FARC. The country has been at war so long that it would seem unusual not to be at war. Mockus seems to, in some people's minds, apparently, represent a new spark of hope for peace.
    While I have not a lot of optimism for a final peaceful settlement to FARC's grievances, if they even remember what they are at this point, I think a great many think a new face and new policies might win the day with help from now friendly neighbors, not antagonized neighbors.