Uribe Until 2014?
    We now believe President álvaro Uribe will run for his third consecutive term in 2010, which, while
     raising longer-term constitutional concerns, is good news for economic and security policy continu-
     ity. This in turn should help Colombia outperform many of its regional peers in our economic and
     political ratings over the duration of our forecast period. That said, we are becoming increasingly
     concerned about Colombia’s longer-term economic growth potential, with the lack of export diver-
     sification and growing pressures on the consumer threatening to hamper strong levels of growth  
     once global conditions improve.
     On the political front, despite the serious political and legal opposition to Uribe’s re-election bid,
    the Colombian electorate still appears overwhelmingly in favour of the incumbent staying in power
     beyond next year’s presidential elections. However, we question whether a Uribe-backed candi-
     date could not continue with these popular policies, which would likely have the benefits of policy  
     continuity while preventing the longer-term damage to the country’s political institutions that a
     re-election bid is likely to cause.
    A major economic concern of ours in the months ahead is the economic situation of Colombia’s
    Andean neighbour and second largest export market, Venezuela. On top of collapsing private
     consumption in Venezuela and a potential devaluation in the bolivar fuerte, Colombian exporters
     are facing the additional threat of having their products removed from Venezuela’s list of ‘essential
     goods’. This would mean these goods must be purchased via the much less competitive parallel
     rate, further hampering both Colombia’s export sector and domestic economic activity.
     On the business environment front, barring the recent spike in violence from the left-wing Fuerzas
    Armadas Revolucionarias (which marked its th anniversary by kidnapping a local councillor and
     killing a policeman and two security guards in the south-western town of Garzón) Colombia’s security
     outlook continues to improve. We do see short term risks to this view, particularly as deteriorating
     domestic conditions point to the potential for an uptick in social unrest. That said, with Uribe now
     looking likely to retain the presidency in next May’s general election on a ticket of maintaining his
     hardline stance towards the FARC, in our view this is clearly a positive for the country’s business
     environment outlook over the medium term.