Fiscal Effects of Coronavirus, Oil Could Last Years In Colombia

The fiscal fallout of the coronavirus pandemic and low oil prices could affect Colombia for several years, Richard Francis, director of sovereign ratings at ratings agency Fitch, said on Tuesday, Reuters reported. Colombia’s government predicts the usually healthy economy will contract 5.5% this year. The country has suspended its fiscal deficit limits for 2020 and 2021 and issued billions in bonds as unemployment rises and businesses close during a months-long quarantine. Fitch Ratings in April lowered Colombia’s credit rating to BBB- from BBB, while Standard and Poor’s in March revised its outlook on the country to negative from stable. “In the case of Colombia, it was not just the factor of the pandemic, it was also the fall in the oil price,” Francis said in a video interview broadcast by financial magazine Dinero. That fall will have “an effect on the fiscal side not this year but next year,” he said. Read more