Economic Crisis in Colombia Due to COVID-19: From Pandemic to Post-Pandemic Actions

Abstract

The COVID-19 pandemic has had a social, economic, and political impact, with companies particularly affected. Policymakers and managers had to make strategic decisions to continue operations. Therefore, this chapter focuses on evaluating the economic impact of the crisis in Colombia from the government, and companies' perspectives, and how they established some strategies to achieve economic sustainability. This analysis is composed of macroeconomic aspects, businesses´ role for economic reactivation, decisions to face the pandemic, and finally, actions that ensure their sustainability. There are issues on fiscal and monetary policies to ensure employment and keep inflation through direct support and rules to improve companies' conditions. Companies themselves should learn about risk management, digital transformation, and the relocation of providers and customers. There is no single recipe to guarantee success, but there is a need for an integrated plan that includes government, central bank, and companies to shorten the economic effects of this kind of crisis.

Key Terms in this Chapter

Economic Cycle: Are the periodic oscillations of an economy, when it goes from expansion to contraction, repeating itself successively.

Deficit: Excess spending that exceeds income. Expenditures are larger than revenue.

Informality: Economic activities that are not regulated by a legal framework.

Policy: Set of plans/ideas followed by governments, business, interest groups, etc.

Colombia: Country located in the north of South America, with access to the sea through the Pacific and the Atlantic and crossed by the Andes. Fourth country in economy and population in Latin America.

Recession: Reduction of the economic activity of a country during a period of time, it is accepted that it be two quarters to declare it.

Short-Term Economic Prospects: Situations that occur in an economy to shift current trends.