Abstract
The economy has performed strongly. The government has lowered the target for the combined public sector deficit. The prospects for sustained growth over the medium term are favorable, in view of the robust growth in nonresidential investment and exports. Fiscal policy will remain on a sustainable path. Key structural reforms will move forward, once the new congress and government take office. The inflation targeting framework has provided a useful anchor for expectations and confidence. The government is developing several reforms to deepen the financial system.
The Executive Board of the International Monetary Fund (IMF) on June 12, 2006 approved on a lapse-of–time basis the second review of Colombia’s performance under an 18–month SDR 405 million (about US$ 597 million) Stand-By Arrangement approved on April 29, 2005 (see
Completion of this review makes an amount equivalent to SDR 320.4 million (about US$ 472 million) immediately available to Colombia. However, the authorities continue to treat the arrangement as precautionary, and do not intend to draw on the credit available.