Economy

Business confidence in Colombia dipped on COVID containment measures

Business owners' outlook on whether things would improve for companies and the country over the next 12 months deteriorated last month

Photo: REUTERS/Luisa Gonzalez

Business confidence in Colombia experienced a slight decline for the second consecutive month in January due to the impact of confinement measures used by authorities to control a second wave of the coronavirus, the government said on Friday.

The business confidence index fell 0.12% to 48.7% in January, the government’s DANE statistics agency said.

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Colombia‘s biggest cities declared neighborhood lockdowns during the last days of December and the start of January, as well as curfews and restrictions on movement to contain a second wave of the pandemic.

Business owners’ outlook on whether things would improve for companies and the country over the next 12 months deteriorated last month, according to DANE.

“This may be an indirect sign that effectively targeted closures, specific measures to restrict consumer access to goods and commerce due to the epidemiological situations that we saw in January are presenting cause for concern,” said DANE director Juan Daniel Oviedo.

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Some 46.9% of business owners reported declining demand for their goods and services, as well as supply-side problems, Oviedo said.

Latin America’s fourth-largest economy contracted a historic 6.8% last year.

While both analysts and authorities expect economic recovery this year, Colombia‘s central bank lowered its GDP growth projections for 2021 to a range of between 2% and 6%, with 4.5% as the most likely figure, from a previous projection of between 3% and 7%, due to the quarantines of the first month.

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