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Petro Lays Out Long-Shot Plan for Colombia Constitutional Rework

(Bloomberg) -- President Gustavo Petro is trying to build popular support for his bid to overhaul Colombia’s constitution, which faces long odds of success given legislative and judicial hurdles.

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With his popularity waning after a year and a half in power, Petro seized the spotlight over the weekend by saying he wanted to convene a so-called constituent assembly. He shed more light on his plan Monday, laying out eight areas for reform including enshrining guarantees for healthcare and drinkable water, as well as changing the central bank’s mandate to prioritize economic growth and employment while maintaining the institution’s independence.

Petro added that he isn’t seeking a constitutional change that would allow him to stay in power after his term ends in 2026.

Institutions created in the 1991 Constitution “have not been able to resolve several fundamental problems that hold back Colombian society, and that is why the constituents — that is, the people — must come in to solve them,” Petro said in a long post on social media platform X.

A constitutional rewrite in Colombia would require majority support in Congress, approval of the courts and a successful referendum. Petro has so far been unable to get lawmakers to sign off on his healthcare and pension reforms while the latest polls show his approval rating at about 35%, up from a low of 26% at the end of last year.

Markets have so far shrugged off concerns about a potential constitutional overhaul. The Colombian peso was little changed Monday at 3,877 per US dollar, the strongest since January, while dollar-denominated sovereign bonds due in 2034 fell by less than a cent to 101.24 cents.

Economic groups, however, warned that the president’s intention to seek constitutional change outside Congress sends a bad signal to businesses and investors.

“A Constituent Assembly would not only generate greater uncertainty, polarization, and political, legal, economic, and social instability, but it would also distract from the search for real solutions,” Aliadas, an umbrella lobbying group that represents Colombian industries and workers across multiple sectors, said in a statement.

Radical changes in the Colombian economic model are unlikely, Credicorp Capital said in a report to investors, while adding that political and regulatory noise will continue to put pressure on the nation’s risk premium.

Analysts at Teneo Holdings, meanwhile, see a political motive in the president’s move.

“The issue may create a distraction from Petro’s legal difficulties, the government’s poor policy delivery record, and his failure to advance his reform agenda,” managing directors Nicholas Watson and Mario Marconini said in a report.

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