Colombia's New Presidential Front-Runner Brings Optimism Among Coffee Sector
Coffee Network (Bogota)- Colombian coffee growers are optimistic with the new front-runner presidential candidate Rodolfo Hernandez as he plans to implement more friendly conditions for the agricultural sector, including coffee, unlike his contender who plans to slap high taxes on idle land.
Colombia’s new front-runner presidential candidate Rodolfo Hernandez, a former mayor of the city of Bucaramanga, is polling 52.3pc of vote intention for June 19 second-round of election, compared with leftist Gustavo Petro who has 45pc, according to the most recent survey by GAD3.
Colombia held first round of presidential elections on May 29, but neither of two candidates obtained the 50pc plus one vote needed to secure the presidency.
As for his economic policies, Hernandez’s proposals are more of a mixed bag. He is a businessman, and his instincts seem to be to provide space for the private sector, though some of his ideas suggest he could lean towards protectionism and (Latin American) industrial policy, favoring trade protection for the agricultural sector, JP Morgan recently said.
The 77-year old businessman Hernandez calls to revise some free trade agreements so that it will not allow the import of products when there is sufficient supply in local production.
“A country of agricultural vocation like Colombia must return to the fields and work to give peasants the tools necessary to be competitive. Free trade treaties have put the peasant producer to compete with all agribusiness of developed countries that inject subsidies ... not allowing producers to compete,” Hernandez’s manifesto says.
Large coffee grower Juan Alvaro Arboleda said people in the Antioquia region are optimistic with Hernandez as they had feared that Petro could win implementing socialists ideas in Colombia.
“People are very optimistic with Hernandez. People are very excited. Growers were very sad and bored with the possible arrival of (leftist) Petro,” coffee grower Arboleda told Coffee Network.
His contender former guerilla candidate Gustavo Petro aims to slap high taxes on unproductive land. He also seeks to review Free Trade Agreements that hurt local agricultural production
Hernandez calls to establish an agricultural and rural state policy that responds to international market variables. He calls to industrialization of the fields with engineering programs for production that use technology from tip, replicating successful models in the world like Japanese and Israeli.
He will promote an agricultural law that prioritizes the use of supplies of national origin, particularly fertilizers. He will implement associative or agro -business models among large, small and medium producers aiming at the transformation of agricultural products including medicinal cannabis, poppy and coca derivatives. “This will have a collateral effect a contribution to the eradication of illegal crops, affecting in the reduction of violence by affecting the financing of groups outside the law,” he says
Petro’s proposal of raising taxes on landowners seeks to force the brake-up of large agricultural estates into smaller parcels.” This is a longstanding feature of Petro’s agenda, including in his 2018 failed bid. The discussion is framed under the lenses of an agrarian reform and seeks to bolster land ownership by small and local cooperatives,” JP Morgan said.
Petro has been consistently indicated that his plans would not amount to expropriation, and his advisors have even suggested that his land reform would allow the market to more efficiently “right size” landholdings to be more productive. However, critics point out the likely lack of buyers for highly taxed land, and the likely role of the state in acquiring and re-appropriating land, JP Morgan added.
Petro also calls to strengthen local companies that produce fertilizers to avoid the dependence on importer fertilizers. “In the short term we will load the productive recovery of Monomeros and Ferticol and the development of a national fertilizer industry,” reads his manifesto.
Petro plans to build collection centers and goods for transformation agroindustrial and the development of food chains of corn, rice, wheat, potato, avocado, banana, cassava, soy, sorghum, yame, tomato, coffee and cocoa. He aims to strengthen cooperatives.
He will foster the cannabis industry in the hands of the producers, articulating industry and knowledge, as well as the diversification of uses in medicine, textiles and food.
Second round
Recalling what the CNC poll suggested about a potential migration of votes in the Petro-Hernández scenario. According to a CNC poll released on April 21st, in a Petro-Hernández runoff, 60% of votes for center-right candidate Federico Gutiérrez, who was third during the first round, would go to Hernández and 8% to Petro, while those for Sergio Fajardo (fourth during the first round) would split 53%-18%, respectively.
Thus, following results, this survey would suggest that on June 19th, Hernández would receive ~9.46 million votes and Petro 9.1 million votes.
“In any case, said poll showed a high share of undecided and blank voters under this scenario (~30%), which will be critical for the outcome. Although political results appear to be unpredictable, it seems likely that Hernández may be able to collect a non-negligible part of these undecided voters in the runoff as, in the end, most of Gutiérrez supporters could tilt towards him, thus elevating his chances to win,” local brokerage Credicorp said in a research note.
By Diana Delgado
