Colombian Banks Mandated to Invest Amid Economic Emergency

Colombian President Gustavo Petro has initiated drastic measures by declaring an economic emergency, compelling banks to make compulsory investments. This bold move is part of a larger strategy to mitigate the impacts of severe flooding in the country.

The declaration, announced on Wednesday, empowers Petro's administration to enforce decisions via decrees, bypassing the need for Congressional consent. The move aims to mobilize approximately 8 trillion pesos ($2.182 billion) in much-needed funds.

Previously, in August 2024, Petro had introduced measures to push financial systems towards more credit investments, sparking concerns amongst banks. Despite their agreement on increasing loan portfolios, President Petro noted the lack of implementation thus far.