Sunday, December 26, 2004

Colombia in 1925

This is what The Economic Review had to say about the economic conditions in Colombia in its edition of October 6, 1925. I am really amazed at what appears to be fiscal responsibility and sensible economic management. Or perhaps it is wishful reporting on the part of this journal?

Regardless, it seems like it's been all downhill from there.

The Economic Situation

“During the past two years national production and the export trade have favorable foreign trade balance has been considerably augmented. Business generally has become brisker, revenue increased, banking movements multiplied, the monetary circulation enlarged, and the general financial conditions rendered more satisfactory. Among agricultural products coffee and bananas together hold the most important position in the country’s foreign trade…the development should be still more satisfactory now that the railways are being extended and transports made more rapidly and at cheaper rates…Since the year 1920 the trade balance has been favourable. The total volume of exports in 1913 amounted to 238 million kilogrammes; in 1924 it had grown to 328 million kilogrammes…

In 1922 the Public Debt (foreign and internal) amounted to $48,236,221 ; on June 30, 1925, the aggregate Debt stood at $30,075,268.82, the foreign debt being $18,293,585 and the internal debt $11,781,683. Since June 30, 1923 the foreign debt has been reduced by over $15 mill, which amount has been amortised by the product of ordinary revenue.

The above satisfactory results have been achieved without creating new taxation and without in any way inflicting additional burdens upon the economic life of the country.” (italics mine)

On the railways:

"One of the most pressing questions of the day is the necessity for the development of the railway system in Colombia…The chief difficulty…is that of securing the requisite money for the work. It is estimated that at least 200 mill. pesos will be required; despite the country’s favorable economic situation this sum is beyond its present domestic capacity. On account of the general money stringency on the international markets it appears that the United States is the only country where this credit can be secured, but at rates that are not advantageous to Colombia…"


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