Carolina Heredia Quesada

Imagining the Colombian economy after COVID-19

Written by César Ferrari* y Jorge Ivan González**
May 4, 2020

The crisis caused by the pandemic invites us to transform the economy for the benefit of the
majority. Here's what we can do to achieve it. César Ferrari, Ph.D. professor in the Department
of Economics at the Universidad Javeriana. Jorge Iván González, Ph.D. Co-Founder of Public
Reason A better future Sooner or later the coronavirus will give way and quarantine will be a
thing of the past. We will have suffered a great recession along the way and recovered. But
what about the economy? Will it stay the same? The very virus that caused a global economic
crisis offers us a unique opportunity: to transform the economy for the benefit of humanity.
Work for a better future for all. To achieve this, we must give primacy to essential food, health,
education, housing, communication and security goods and services, and value those who
produce them more. In capitalism, this means giving more social recognition and better pay to
peasants, fishermen, doctors, nurses, teachers, builders policemen and other essential workers.
This will be possible if we design policies that allow for farmers to be co-owners of the
production chain to be universalized, that public servants are better renumbered and private
workers have fair remuneration. At the same time, we will have to change our priorities and
reduce the overvaluation of expendable goods and services that advertising has oversold us.
Not relying on traditional exports In addition to the health crisis and quarantine, we have
suffered a drop in external resources, resulting in less production and higher unemployment.
This decline was the result of a lower international price of oil and coal, which account for
nearly 60% of our exports. The fluctuation has been such that this April 20 the WTI barrel of oil
reached a negative price of USD$37. To stop being dependent on these two products and
advance the change in the energy matrix and sustainable development, we need to increase
the competitiveness of other sectors such as agriculture, agribusiness, manufacturing, tourism
and creative industries including software design and digital applications. This in turn requires a
stronger structure of relative returns through monetary, fiscal and regulatory policies.

Quality health and education for all Universal health insurance doesn't make sense if care
comes months after need, and often through guardianship. And the pandemic has exposed the
inadequacy of the health system: poor working conditions for medical staff, the small number
of UCIs, respirators or laboratory tests. The distinction between the spSs insurers and
intermediaries and the IPS providing the health service is inefficient. The former are not
necessary because they consume a lot of resources and do not provide a good service. The
citizenship certificate should be the only requirement to be served in any health service, as is
the case in Europe or Canada. The health system needs more resources to increase the number
of beds, medical equipment, and appointments. The emphasis on prevention and improving
primary care is also important. On the other hand, private colleges and universities have
managed to cope with quarantine thanks to virtual classes, but most public and rural campuses
have not been able to access this solution. That is why, as Angel Pérez points out in this same
edition of the magazine, we must seriously increase the state's investment in the education
sector and reduce the inequality gap that characterizes it, particularly the backwardness of
virtuality in poor rural and urban areas.

ACADEMIC PRACTICE

1.  READ THE ATTACHED TEXT AND CHOOSE 10 WORDS THAT ARE NEW FOR YOU OR NOT
THE KNOWN AND ITS MEANING IN SPANISH.

Achieve: Lograr
Housing: Alojamiento
Co-owners: Copropietarios
Farmers: Agricultores
Such: Semejante
Relying: Confiando
Backwardness: Atraso
Staff: Personal
Unemployment: Desempleo
Inadequacy: Insuficiencia

2. OF THE 10 WORDS CHOSEN IN THE PREVIOUS POINT OF 10 ENGLISH SYNONYMS

Lograr: Reach
Alojamiento: Lodging
Copropietarios: Partners
Agricultores: Cultivators
Semejante: Similar
Confiando: Confessing
Atraso: Delay
Personal: Only
Desempleo: Dismissal
Insuficiencia: Shortage

3. WRITE A PARAGRAPH IN ENGLISH SUMMARIZING THE MAIN IDEA OF THE ARTICLE READ
The capitalism gives more social recognition and better pay to peasants, fishermen,
doctors, nurses, teachers, construction police and other essential workers. This is possible
if we design policies that allow farmers to be co-owners of the production chain that is
becoming universal, that public servants are better counted and private workers have a
fair remuneration. At the same time, we will have to change our priorities and reduce the
overpricing of expendable goods and services that advertising has oversold us. It does not
depend on traditional exports In addition to the health crisis and quarantine, we have
suffered a drop in external resources, which has resulted in lower production and higher
unemployment.
 4. BUILD THREE QUESTIONS IN ENGLISH ABOUT THE ARTICLE READ

5. What effects it will have on the Colombian economy, the loss of the degree of
investment and the drop in the country's credit risk rating by international risk rating
agencies(*).

De acuerdo con algunos expertos, la pérdida del grado de inversión no solo generará
una reacción más volátil en los mercados en el corto plazo, sino que también tendrá
consecuencias de mediano y largo plazo para la deuda pública y privada, y para la
inversión extranjera directa.

Como la calificación crediticia es una especie de nota de las agencias sobre la

capacidad que tiene un deudor de pagar sus deudas, la pérdida del grado de inversión
implicará que los prestamistas extranjeros cobren mayores tasas de interés para darle
crédito a Colombia, pues hay mayor percepción de riesgo de impago. De esta forma, el
Gobierno tendrá que usar un mayor porcentaje del presupuesto en el pago de la
deuda. Este mismo efecto se extendería a la deuda privada.

(*) Risk classifiers are companies dedicated to rating the credit risk of all types of financial
obligations, i.e. the likelihood of non-compliance. Among the world's leading qualifiers are
Moody's, Standard & Poor's and Fitch Ratings.

* Ph.D. profesor del departamento de Economía de la Universidad Javeriana.

** Ph.D. Cofundador de Razón Pública; para ver el perfil del autor haga clic