Colombian Update : What's New (s) : The Weekender October 8th 2018

THE WEEKENDER

A relatively quiet weekend here in Colombia, well at least if you weren't ex-President Santos who had to tolerate being abused by a passenger both at the airport and on the plane and then see the while incident published on social networks. This is the sort of divisive behaviour that the country has to move on from if there is ever to be a lasting peace here - speaking of which like a dripping tap there is a constant news flow of violent incidents purported by a variety of groups which are slowly but surely leading to the fear that we are slipping backwards into a bygone era...concerning. PRICES The inflation data for September was released and once again was benign in nature. The monthly reading of 0.16% was up on the 0.04% registered a year ago however the 3.23% 12 month number is well below the 3.97% where we stood a year ago. Finally YTD CPI stands at 2.63% versus the 3.49% of September 2017 so overall we look to be in good shape. In terms of groups it was a education (+0.3%), food (0.29%) & housing (+0.18%) which contributed the most and if we bore down a level more we find ‘other fresh fruits: by far and away having the largest impact followed by rent. For the authorities the trends continue to be favourable as we move towards a year end figure of around 3.3%, the latest Fedesarrollo survey was looking for a 3.27% number but their September number was 3.20% so we may some slippage from that prediction. It is hard to imagine Dr Echavarria and the rest of Central Bank committee losing any sleep over these numbers, the same survey had well over 90% of analysts expecting no change to interest rates during the balance of 2018 - there appears little reason to doubt them. There is though one cloud on the horizon or to put it far more accurately - a lack of clouds on the horizon for the end of 2018 with continued rumblings about the onset of another El Niño striking the country. It isn't expected to be even close in magnitude to the record breaking event that started in 2015 however it will not be welcomed by anyone, save those who want to top up their tans.

The bad old days of 2016...

EXPORTS Once again a good looking number for August when we look at FOB$ with an increase of 13.1% and as Dollars equal Pesos then perhaps that is all that matters but long term perhaps that is not enough. Whilst combustibles/mining etc accounted for 58.7% of total export revenues it is well worth noting that at the very moment when everyone is getting fluffy over oil prices Colombia during August exported 19.5mn barrels - a 0.6% decline YoY. In order to become the devil's number one advocate lets take a look at the tonnage exported which during the eighth month of 2018 actually dropped 21% YoY - the major driver here was not oil (-0.4%) but instead coal/briquettes which were down 31.7% and effectively accounted for all of the decline. The other two sectors saw manufacturing unchanged in terms of tonnage although it fell marginally in terms of dollars whilst Agriculture (+11.3%) did well in terms of tonnage driven by fruits and vegetables (+29.4%) - the issue here of course is that as a sector it weighs little in the overall export index and the Government are not taking the countryside as seriously as they should.

Ooopss.......

VENEZUELA This Saturday the UN High Commissioner for Refugees arrived in Colombia to take a personal look at the situation on the border with Venezuela, this being the first stop of a four country tour which will include the other two main refugee recipients Peru & Ecuador. This all comes off the back of the recent trip to the UN by the President and the pledge by the global body to support the case and the appointment of Eduardo Stein as the special representative for the crisis. One of the main challenges is going to be keeping the refugees in close enough proximity in order to support them, for the time being they are scattering all over the country as well as the wider region and that complicates the situation.

The commissioner was in Cucuta by Sunday observing the flow of refugees across the border and the cynic might suggest that all too often observation is the UN's main function with intervention a distant second. Hopefully with relatively early intervention the situation will at least prove manageable - if not the commissioner's's words with regards to the protection of women and children will be no more than that.

Scattering....

GRUPO EXITO Congratulations to Grupo Exito who opened their 14th Viva shopping mall this weekend in Envigado a little more than a stones throw from my apartment. It is the biggest such venture in Colombia and at 260,000 m2 is even bigger than the largest mall in the UK at Westfield in London. Clearly having such a shopping facility close by is a hazardous business but with such an extension of space it should be reasonably easy to hide from the wife if need be.

Plenty of hiding space....