Bogota: Colombia’s President Gustavo Petro has announced plans to declare an economic emergency and introduce a new financing law as the country faces a growing budget crisis.
The government is struggling to cover its 2026 national budget, which has been approved but lacks sufficient funding. Petro said urgent steps are needed to close the gap and protect the country’s economic stability and living standards.
As part of the plan, the government will present a new tax reform bill to raise additional revenue. However, the details of how much money the reform aims to generate have not yet been made public. This comes after an earlier tax reform effort failed to pass in Congress last year.
Petro warned that if lawmakers do not approve the proposal, he may use emergency powers to push through the measures by decree. This has raised concerns among political observers and legal experts, especially because some of his previous emergency actions were blocked by the constitutional court.
The move also comes at a time of rising tensions between the government and the central bank. Disagreements over interest rate policies have added to uncertainty about the country’s economic direction.
Analysts say it may be difficult for the current Congress to approve the new reforms before its term ends in June. A new Congress is expected to take office in July after upcoming elections, which could delay decisions on key economic policies.
Colombia is currently facing pressure from a widening fiscal deficit, high interest rates, and concerns about inflation. The government has already relaxed some fiscal rules to manage the situation, but challenges remain.
The coming weeks are expected to be crucial as the government seeks political support for its plan while trying to avoid further economic instability.