In geographical economics, there is an important lesson: good policies, along with bad ones, can spread throughout regional neighbors. Which policies will spread depend on the institutional frameworks and the mental models of decision-makers within countries, as New Institutional Economics has demonstrated. However, the international context in which countries have to act is also an important and determinant factor.
This is what can be seen in the case of Colombia. This country, very recently, since the government of Álvaro Uribe Vélez (2002–2010) decided to follow the path of Chile, Mexico, Peru, and Panama in the implementation of free market policies.
However, these policies remain weak at best. There are still broad areas in which the state has kept its interventions and the results of, for example, free trade agreements (FTAs) remain to be seen due to their very recent implementation. (The FTA with the United States, for example, started a bit more than a year ago, and the FTA with the European Union will start in the next months).
Meanwhile, real threats to the continuation of the liberalization path have strengthened very quickly. On the domestic front, statist parties, such as the Polo Democrático Alternativo, have developed consistent opposition to FTAs, and right now, some of their representatives in the Colombian Congress are the best perceived in terms of public opinion.
The international sphere, however, is where the most important threats exist. According to surveys, in the near future, overtly interventionist candidates could not win the presidency. But internationally, Colombian decisions have been criticized and rejected by the Venezuelan, Nicaraguan, Ecuadorian, and Bolivian governments at different times. Further, there have been cases in which all the countries have opposed Colombia’s decisions at the same time. Some of the policies have even generated collective, international confrontations such as with the United Nations or with regional organizations such as the South American UNASUR.
This international pressure is understandable, since those countries belong to what has been called the Socialism of the Twenty-FirstCentury. However, in Juan Manuel Santos’s government (2010-), this pressure has been more effective because — among other reasons — Santos allowed Venezuelan president Hugo Chávez, first, and Nicolás Maduro, later, to have a major role in the ongoing peace process with the guerrilla group FARC. In this sense, the Colombian government allowed Venezuelan leaders to be seen as relevant in the eventual result of an internal issue.
With this platform, socialist countries in Latin America have been able to support, for example, the demonstrations in the region of El Catatumbo, where there has been a direct influence of the FARC. Recently, even more, the Marxist social and political movements of Latin America have supported the simultaneous strikes that are taking place — and that will take place — in different regions of Colombia.
As a result, right now Colombia could be the subject of a strategy to destabilize the country from its social grassroots. For this threat to be neutralized, the Colombian government’s answer should be twofold. First, it should resolve the social instability in a faster and more effective way by winning the “hearts and minds” of Colombian peasants without increasing subsidies or paternalist promises and by reducing the use of military power against the demonstrators. Second, it should enhance its foreign policy by being more assertive in its relations with the neighbors and by limiting their capacity to discuss or opine about domestic issues and decisions. Indeed, very difficult things to do.
Otherwise, if our Latin-American socialist “partners” gain more confidence from social movements in the country, in the medium- term, Colombia could be an example of the spread of bad policies, rather than the best option of individual decision-taking and liberty. That would not just occur because Colombian decision-makers have decided so, but also because easy, ineffective — and hypocritical — “social” rhetoric coming from our neighbors’s governments is more attractive when citizens think their own state is their enemy.
Colombia is in need of a different neighborhood. However, since this is not an option, its government has a more difficult task. It is not to damage the relations with the socialist partners but to, on the one hand, consolidate a social consensus in which all domestic stake-holders understand that the best option is to deepen the path of economic liberalization and, on the other hand, to prevent the socialist countries from undermining domestic stability. It remains to be seen whether Juan Manuel Santos is up to this task.