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BOGOTA (Reuters) – Colombian President-elect Ivan Duque on Wednesday named Alberto Carrasquilla as his finance minister when he takes office in August, and said he and the central bank agreed on the need to bolster economic growth and strengthen the middle class.
Carrasquilla was previously finance minister from 2003 to 2007 under former President Alvaro Uribe and was also a technical economist at the central bank and the Inter-American Development Bank. He will succeed Mauricio Cardenas, who is part of outgoing President Juan Manuel Santos’ administration.
He is “a person who knows in depth monetary issues, tax issues, who knows very well the budget structure of the government and has a great capacity for communication,” Duque said of Carrasquilla in comments to reporters after a lunch with central bank members.
The 59-year old Carrasquilla faces the difficult task of pushing unpopular fiscal changes through a divided Congress – including an overhaul of the pension system – while helping stimulate weak growth and warding off a downgrade from credit ratings agencies.
Duque, a right-wing former senator who was elected president on June 17, has promised to bolster the $324 billion economy with tax cuts and support for extractive industries such as oil and coal, the country’s top exports. The government expects the economy to grow 2.7 percent this year.
Some economists are concerned his proposed tax cuts may worsen the budget deficit, making it tough to preserve Colombia’s investment-grade credit rating. Duque has yet to reveal specific policy measures.
Ratings agency Fitch said last month that Duque’s election signaled a continuation of economic policies, but added that a fiscal consolidation and encouraging growth were his government’s key challenges.
“Carrasquilla is a very good sign for economic policy and a very good signal for international markets,” said Duque, who succeeds the center-right Santos on Aug. 7.
Carrasquilla studied economics at the University of Los Andes in Bogota and has a doctorate from the University of Illinois Urbana-Champaign.
He will also take a seat on the board of the central bank, representing the government, and continue the bank’s efforts to maintain inflation within its target range of 2 to 4 percent while tacking sluggish economic growth.
“We had the opportunity to talk about the economic situation of the country, the challenges in terms of growth, monetary policy and I must say that I am pleased that we are aligned with the decision to grow our country at the rate it deserves and that can strengthen middle class,” Duque said of his lunch with board members.
Reporting by Helen Murphy, Carlos Vargas and Nelson Bocanegra; Editing by Peter Cooney