Colombian President Duque declares new state of emergency to ease pain of virus lockdown

Outbreak of the coronavirus disease (COVID-19) in Bogota. REUTERS

Colombia has declared a second state of emergency to support sectors of the economy that will remain shut down for an extended period to reduce the spread of the novel coronavirus, President Ivan Duque said on Wednesday.

The state of economic emergency allows the president to issue decrees without prior authorization from the Andean country’s congress during times of crisis or a threat to Colombia’s security.

Under the Constitution, the government can declare a state of emergency for up to 30 days. The total period of rule by presidential decree cannot exceed more than 90 days a year.

“We are signing this emergency today so that we can introduce measures to return the country from this situation,” Duque said in his nightly televised broadcast.

Under the measures, the government will subsidize workers’ pay to the tune of 40% of the minimum wage in companies whose turnover has fallen by at least 20% due to the impact of the coronavirus outbreak. The minimum wage in Colombia is just shy of 1 million pesos a month, or around $250.

Payment of income tax by businesses will also be pushed back to the end of the year, Duque said. Additional measures will be announced shortly, he added.

The first state of emergency expired in April, although a separate health emergency – which ordered mandatory isolation for the elderly until the end of May among other measures – remained in place.

In the first state of emergency, Duque issued a raft of economic measures worth around $4 billion, including support for family social welfare programs and the elderly and credit guarantees for some businesses.

But Finance Minister Alberto Carrasquilla said earlier on Wednesday that more was needed, including support for businesses that will remain sidelined longer than expected due to the COVID-19 pandemic.

The country is under a nationwide lockdown until May 25.

On Tuesday, Duque said car sales and some industrial sectors could re-start beginning from May 11. But he warned that certain sectors will see a delayed return to normality.

Colombian fiscal authorities on Monday cleared the way for the government to widen its deficit to 6.1% of gross domestic product this year, owing to an expected 5.5% economic contraction.

The new deficit limit will allow the government to take on around 40 trillion pesos ($10.2 billion) in extra debt from a previous forecast, when a deficit reaching 2.2% of GDP was expected.


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