Presidential election in Colombia: A 180 degree turn

In Colombia, the right-wing populist candidate Abelardo de la Espriella won the second round of the presidential election on Sunday, 21 June, which achieved a record voter turnout of 63.4%. Preliminary estimates indicate that he secured 49.7% of the votes, narrowly surpassing left-wing candidate Iván Cepeda, who garnered 48.7% and represented a continuation of the policies of outgoing President Gustavo Petro (2022-2026). This election marks a significant shift to the right for the country, following the lead of Argentina and Chile, now governed by President Javier Milei (since December 2023) and President Antonio Kast (since March 2026), respectively. Meanwhile, Peru is still counting the votes from the second round of the presidential election and may soon follow suit, while Brazil is due to go to the polls in October.

In the financial markets, investors reacted positively to the election outcome. Since 31 May, the date of the first round in which Abelardo de la Espriella topped the poll, the Colombian peso has appreciated by 7.1% against the US dollar, while the average yield on 10-year sovereign bonds has fallen by 150 basis points. Investors have been attracted by the new president’s pro-market programme, which promises a clean break with the previous administration. Similar to his Argentinian and Chilean counterparts, he advocates for economic liberalisation and a rapid consolidation of public finances, as Colombia registered one of the largest fiscal deficits in Latin America[1] in 2025.

Economic growth: a rebalancing of growth drivers rather than an acceleration?

Between 2023 and 2025, Colombia’s economic growth averaged 1.6% per year, compared to an average of 2.3% in the region. This growth was driven by consumption (+2.2% per year on average), especially government consumption (+3.5% per year). By contrast, investment contracted by 3.6% per year. Consequently, the investment ratio fell from 19.1% of GDP in 2022 to 16.1% of GDP in 2025, marking a twenty-year low.

The economic liberalisation promised by A. de la Espriella could revive private investment by reducing interventionism and the uncertainty that accompanies it. He intends to lift the ban on issuing new licences for hydrocarbon exploration and on hydraulic fracturing (fracking), two measures introduced by G. Petro’s administration and aimed at steering the country towards an energy transition. Crude-oil production should therefore rebound after a 1.5% decline since 2022. Goods exports (+0.2% per year on average from 2023 to 2025) are also expected to rise, as hydrocarbons account for 46% of total exports (2022-2025 average).

Download the Full Report!