This week Colombia's Liberal Party offered its backing to market-friendly Federico Gutiérrez – who currently trails left-wing Gustavo Petro in the polls – ahead of next month's presidential election. This decision may offer some solace to investors, although we think that Gutiérrez's plans for fiscal consolidation look ambitious and may be politically difficult to achieve. This suggests that, while public debt risks would be lower than under a Petro presidency, Gutiérrez may struggle to put Colombia's public finances on a sustainable path over the medium term.
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