Santos Notes That Peace Will Boost Colombia’s GDP – Economic Drivers Behind War and Peace

Christof Lehmann (nsnbc) : Colombian President Juan Manuel Santos said that the Colombian economy could grow as a result of the end of the armed conflict in the country. Analysts note that economic drivers have played a role in bringing the government and the Revolutionary Armed Forces of Colombia – People’s Army (FARC-EP) to the negotiating table in 2012.

Juan Manuel Santos_Colombia_Pacific Alliance Summit 2016President Santos was speaking at the Summit of the Pacific Alliance regional trade block in Frutillar, Chile, together with his counterparts from other member states Chile, Mexico and Peru. Santos noted that Colombia’s GDP could grow with at least one percentage point per year if the 52-year-long civil war in the country finally comes to an end.

The administration of President Santos and the FARC-EP have recently formalized an agreement about a bilateral ceasefire. Details about the disarmament of the largest leftist guerrilla under international supervision are being worked out, while the FARC-EP prepares for its transformation from a guerrilla into a non-armed political organization that aims at legal participation in Colombia’s political discourse.

The government and the second-largest leftist guerrilla, the national Liberation Army (ELN) are also making progress with regard to launching official peace talks. Talks should have been started in May but disagreements about the status of “hostages” held by the ELN and ELN fighters and political prisoners held in  government prisons has delayed the official part of the talks.

Santos commented on the ceasefire between the government and the FARC-EP, saying that “The ceasefire agreement frees up a potential that has been repressed by war. This will allow the private sector to reach the markets and areas they never were able to reach”. He added that consequently, Colombia’s national economy could grow with at least one percent per year. Santos stressed that an end to the FARC-EP’s armed activities would additionally create investment opportunities for both Colombian and foreign firms.

Economic factors have played as significant a role in keeping the 52-year-long civil war alive as they have contributed to bringing the government and the FARC-EP to the negotiating table in 2012.

In his article entitled “Why only now – after 51 years – war is ending in Colombia”, Nazih Richani is Associate Professor, Political Science and Director of Latin American Studies, Kean University, would note that changes that set in around the year 2000 made it difficult for the government’s and the FARC-EP’s economies to coexist. Richani noted that Simon Gaviria, president of the Liberal Party, a close ally of the present president Juan Manuel Santos, in 2012, presented findings that estimated that the costs of war over the previous decade had reached 206 billion Colombian pesos (or US$108 billion).

Richani added that this number was presented as a critical part of the rationale behind the peace initiative launched by Santos in that same year. With regard to foreign policy factors, Richani noted that it was also a critical indicator of an emerging consensus within a sector of Colombia’s urban bourgeoisie that the heavy military investment and effort of the past decade had reached the point of diminishing returns. Heavy US involvement had weakened but failed to defeat the insurgency. The insurgency was able to adjust and build up its strategic depth outside Colombia, in Venezuela and Ecuador.

By 2014 the Colombian military had 500,000 personnel (including police), the largest force in Latin America. However, the cost of armaments and operations were dwarfed by that of pensions, health benefits and wages. Gaviria stressed that if the war were allowed to drag on for another decade, the costs could run as high as another $108 billion. The time had come to test the ground for negotiations with FARC-EP.

Santos will have been aware of these factors when he spoke about the potential minimum one percent growth in Colombia’s GDP and improvements in the investment climate in the country after the end of the 52-year-long civil war. The litmus test for the possible success in this regard will be whether or not the peace will be socially just. A “peace” without social justice and the abuse of the peace for the implementation of a hardline neoliberalism may as well trigger massive social unrest and destabilize the country’s economy more than the civil war and years of parallel economies ever have destabilized the economy. Santos’ recent attempt to denounce the FARC-EP of “preparing for urban warfare if the peace talks fail” was not exactly signaling readiness to “genuinely” include the FARC and the ELN  and associated grassroots organizations in a socially just political discourse.

CH/L – nsnbc 02.07.2016

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