DoubleLine.com Publishes Paper: "Colombia's Petro: A Shift to the Left or a Repeat in Moderation?"

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Aug 04, 2022, 09:00 ET

LOS ANGELES, Aug. 4, 2022 /PRNewswire/ -- In a new research paper, DoubleLine Global Bond Portfolio Manager Valerie Ho examines the political and economic challenges facing Gustavo Petro as he prepares to take office Aug. 7 as the first left-wing president of Colombia.

Voters elected Petro to the presidency, Ms. Ho writes, on a campaign platform for a sweeping new economic model in a context of high inflation, slowing global growth, entrenched inequality and poverty. However, given Petro's "party's lack of a congressional majority, he must walk a fine line. Recognizing this, he has courted centrist parties to join his government coalition. Their support will be conditional on a scaling back of his ambitious agenda."

While this moderation in the near term is welcome news to investors who prefer more orthodox economic measures and fiscal responsibility, Ms. Ho asks, "how forgiving is Petro's time horizon? New social spending and tax changes must run through the partisan dance of compromise and deal-making – and might prove too slow to stem mounting social pressures on the next government. Colombians who propelled Petro into the presidency are demanding change today."

To read the paper, please click on this link: https://doubleline.com/wp-content/uploads/Colombia-Petro_Valerie-Ho_8-4-2022.pdf

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