SPECIAL REPORT

The second term challenges for in

Bogotá, June 2014

BARCELONA BOGOTÁ BUENOS AIRES LIMA LISBOA MADRID MÉXICO PANAMÁ QUITO RIO J SÃO PAULO SANTIAGO STO DOMINGO THE SECOND TERM CHALLENGES FOR JUAN MANUEL SANTOS IN COLOMBIA

1. INTRODUCTION INTRODUCTION 2. SECOND ROUND The LLORENTE & CUENCA team wrote this document in order to summarize 3. SOCIAL CHALLENGES the political scenario between the fi rst and second round of the presidential 4. ECONOMIC CHALLENGES elections held in Colombia in May and June of this year, respectively. 5. PEACE TALKS WITH THE GUERRILLA The report exposes the political alliances established after the fi rst round, as well as the challenges the government will have to face AUTHORS as a consequence of the alliances made to ensure the reelection of LLORENTE & CUENCA Santos, and as a result of the country's current situation.

2. SECOND ROUND

Last June 15, the second round of the presidential elections between the candidates Óscar Iván Zuluaga (Democratic Center) and Juan Manuel Santos (President and candidate for the Social Party of National Unity1), took place. The Election Day divided the majority of the country between those who wanted the return of the Uribist2 political movement, represented by Zuluaga, and those who saw Santos as the best option to end the decades-long armed confl ict between the country and the Revolutionary Armed Forces of Colombia (FARC) guerrilla.

Both candidates reached this stage after winning over their rivals from the Alternative Democratic Pole, the Colombian Conservative Party and the Green Party in the fi rst round of the elections, on 25 May last. The winner of that round was Zuluaga.

Since that moment, both candidates reinforced their campaigns and made several political alliances in order to obtain more votes. In that sense, Zuluaga's main strategy was to establish an agreement with the former candidate of the Conservative Party, Marta Lucía Ramírez, who became his debate chief.

Additionally, Santos took great advantage over his rival thanks to different alliances made with politicians of the national left as well as with important fi gures of the Colombian society.

The three most important allies obtained by Santos were:

1 National Unity is an alliance composed of: Party of the U, Radical Change and Colom- bian Liberal Party 2 Political Current created by the former Colombian President Álvaro Uribe Vélez.

2 THE SECOND TERM CHALLENGES FOR JUAN MANUEL SANTOS IN COLOMBIA

1. Antanas Mockus: presidential hall take an active part in the candidate of the Green reelection campaign. Party in 2010, who reached the second round this year The common denominator of together with Juan Manuel the electorate in the fi nal phase Santos. He declares that before the second round of the continuing the peace process presidential elections was to of Havana justifi es his support associate Santos with peace to the elected President. through dialogue, in the context “It is clear that there of the talks currently taking is a lot of expectation 2. Clara López: she is the place in Havana; and to associate surrounding Santos President of the Alternative Zuluaga with a more radical and and his promises, Democratic Pole. She obtained even guerrilla attitude, similar geared towards two million votes in the fi rst to the attitude of his political round and supports Santos for party leader and former President improving the social the same reason as Mockus. Álvaro Uribe Vélez. conditions of the Her attitude was criticized by country and obtaining other members of her political Finally, on 15 June last, Colombia the long-sought party, as the majority of the voted and elected Juan Manuel peace” party had decided to not Santos with 7,816,986 votes support any candidate. (50.95% of the votes), whereas Óscar Iván Zuluaga had to resign 3. Gustavo Petro, Mayor of Bogotá, himself and accept the defeat. He leader of the Progressive obtained 6,905,001 votes, which National Movement and former represents 45% of the votes. M-19 guerrilla. Despite his differences with Santos, he Zuluaga's speech after his defeat accepted that three of his most was considered courageous. important offi cials of the city Despite this, the day was controversial as a result of the statements made by the former President Uribe, who affi rmed that Santos' victory was illegitimate due to several cases of alleged fraud. These statements suggest that the next legislative term of the Senate will be fi lled with tension and division, as Uribe will be the new Senator of the Republic from July 20, together with several of his most important and closest politicians.

Considering the new scenario, it is clear that there is a lot of expectation surrounding Santos and his promises, geared towards improving the social conditions The common denominator of the electorate between the fi rst and second round of the presidential elections was to associate Santos with a strategy of peace through dialogue, in the context of the talks taking place in Cuba; and to associate Zuluaga with a more radical attitude. Source: Caracol Televisión.

3 THE SECOND TERM CHALLENGES FOR JUAN MANUEL SANTOS IN COLOMBIA

of the country and obtaining the 4. ECONOMIC CHALLENGES long-sought peace. In addition to this, there is also the issue of the Regarding this aspect, Santos different alliances made in order focuses mainly on establishing to win the reelection. the best conditions to ensure investment growth and economic stability. In order to achieve this, 3. SOCIAL CHALLENGES he would strengthen tax evasion measures to guarantee that both Regarding social aspects, the companies and citizens pay their “Santos focuses mainly main priorities of Santos' second fair share. Thanks to this, the on establishing the best term are: generate jobs, reduce government would achieve the conditions to ensure poverty and improve the state objective of closing social gaps. investment growth and program regarding the delivery economic stability” of housing for the needy. Furthermore, during the next four years the government would: In this respect, Santos promised to double the monthly allowance • Increase investment in rural of the Families in Action program; areas in order to stimulate build 1.2 million houses which rural employment. will encompass priority interest houses, free houses, purchase with • In order to strengthen the allowance money and the leasing mining and energy sector, it and purchase without any money would provide greater certainty down program. In addition to this, to companies, improve Santos promised to encourage the oil exploration to expand development of 12 mega projects oil reserves and increase of urban renewal. production, and develop new inclusion and formalization Regarding employment, he wants programs for small-scale miners. to create a minimum wage which would remain constant; eliminate • Increase by 40% annually non taxes that affect to job creation, mining-energy exports and and create 2.5 million jobs. speed up the entrance of Santos also promised to create goods into the country. international and local value chains, as well as invest in key • Develop Fourth Generation sectors to continue promoting the Road infrastructure (4G): creation of employment. according to the Ministry of Finance, thanks to Moreover, he would establish a the 4G, the dynamic of bilingual plan to improve the the employment and quality of students, ensure free construction sector would education at all levels and increase be maintained. Some even investment in high performance say that GDP might grow an athletes and in sporting arenas. extra 1%.

4 THE SECOND TERM CHALLENGES FOR JUAN MANUEL SANTOS IN COLOMBIA

This initiative requires • As part of the plan to an additional investment enter the Organization for of 547 billion pesos. The Economic Cooperation and government will have to Development (OCDE) and face two extra challenges during the public policies regarding this issue: sell the reviews the OCDE is currently state's participation in Isagen3 conducting, the government "which represent 8% of the would strengthen the National cost of works and convince Planning Department and the banking sector to provide create more taxes related its capital"4, according to to the environment, among Eduardo Behrentz, Dean of other initiatives. the School of Engineering at Bogota's Los Andes University. • Promote key cities for Colombia such as Cúcuta, Buenaventura, Valledupar and Ipiales through the creation of Special Economic Export Zones.

• Create free zones with tax benefits, allowing an USD 3.000 million investment to ensure an easier access for small industries.

• Extend to 100% of the municipalities of the country the music programs and the support to entrepreneur artists with seed capital5.

5. PEACE TALKS WITH THE GUERRILLA

Peace talks with the FARC guerrilla are taking place abroad in order to maintain the levels

3 Joint venture (a company from the pu- blic sector but with private shareholders) dedicated to generate and trade energy. 4 Juan Manuel Santos letters about facing the new economic challenges. El Univer- sal, June 17, 2014. Spanish version avai- lable at: http://www.eluniversal.com. co/politica/las-cartas-de-juan-manuel- santos-para-enfrentar-los-retos-economi- cos-162658 The alliances with other parties gave more votes to the President in the Colombian Atlantic coast and in the capital of the country. Those alliances were essential to the reelection of Juan Manuel Santos. Source: Semana.

5 THE SECOND TERM CHALLENGES FOR JUAN MANUEL SANTOS IN COLOMBIA

of seriousness, security and the agenda, which is related discretion needed to the success to the political participation of the negotiations. The talks are of the guerrilla once the peace currently taking place in Havana process is completed. According (Cuba) and are based on fi ve items to the communiqués issued from related to rural development, Cuba, the agreement is related politic participation, drug to "the rights and guarantees traffi cking, rights of the victims to exercise political opposition and the end of the confl ict. in general and in particular for the new movements, Agreements made access to the media and “A law regarding democratic mechanisms for democratic What happened in the end of civic participation, including participation May 2013 was historic. After those of direct participation, at guarantees will be almost 50 years of internal war different levels and regarding and fi ve unsuccessful peace diverse topics6." promoted” talks during the governments of Belisario Betancur (1982-1986), In that sense, among the most Virgilio Barco (1986-1990), César outstanding aspects, it was Gaviria (1990-1994), Ernesto revealed that: Samper (1994-1998) and Andrés Pastrana (1998-2002), the FARC • A commission to facilitate the and the government reached participation of spokespersons an agreement to establish a from social organizations and new Integrated Agricultural movements will be created. A Development Policy. Status of Opposition will also be established. Very few details about the agreement are known. However, it • A law regarding democratic is known that the new policy will participation guarantees will include subsidies, free lands and be promoted. It will include credits for the farmers. The changes the political movements which brought by this agreement would will emerge from the signing of be managed by the Ministry of this agreement. Agriculture and Rural Development, thanks to laws or decrees, and • The following will be would have no impact on the strengthened: the citizen National Constitution. oversight boards, the community media and the Subsequently, in November promotion by citizens of 2013, an agreement was the culture of reconciliation reached on the second item of aimed at achieving peace.

5 Seed Capital: it is a bid related to the purchase and sale of shares, in which the investor acquires a part of a business or a company. This capital may include options such as friends/ family fi nancing. Ministry of Commerce, Industry and Tourism (Colombia) 6 Know the details of the second agreement in Havana, November 6, 2013. Spanish online version available at: http://www.latarde.com/noticias/politica/124584-proceso- de-paz-conozca-los-detalles-del-segundo-acuerdo-en-la-habana

6 THE SECOND TERM CHALLENGES FOR JUAN MANUEL SANTOS IN COLOMBIA

• Transitory Special Peace Colombian population, affecting the Circumscriptions will be created enjoyment and exercise of its rights to promote the territorial and liberties", stated the parties in integration and political inclusion a joint communiqué shared with the of zones particularly affected by national media. the confl ict and abandonment, in order for these populations Unresolved items to have special representation in the House of Representatives, The FARC stated that a Truth notwithstanding its involvement, Commission (which would delay the as it is already established. process) must be created before “The production and discussing the Victims' Reparation commercialization of Regarding the third item of the item. Likewise, an agreement illicit drugs and the Agenda related to drug traffi cking regarding the End of the Armed criminal economies and illicit crops, an agreement Confl ict has not been reached. between the government and the This last item is related to the have had severe effects guerrilla was made public during disarmament of the FARC, which will on the Colombian the second week of May 2014. In allow them to reintegrate civil life. population” this context, both parties agreed to the following: In this sense, in June of this year the government and the FARC guerrilla • Substitution programs for illicit reached an historic agreement use crops. Comprehensive to listen to the victims during the development plans with talks in Havana. Delegations will community participation in go to Havana to be heard, and four the design, execution and regional forums for victims of the evaluation of the substitution FARC will be created to convey and environmental recovery proposals. A Truth Commission will programs for the areas be created: it will decide who the affected by such crops. perpetrators were in Colombia and how they proceeded. • Drug use prevention and public health programs. Talks with the ELN guerrilla

• Solution to the narcotics pro- A few days before the second duction and commercializa- round of the elections, a joint tion phenomenon. communiqué was issued. It revealed the items to be dealt with in this "...the persistence of the crops is new process. According to the linked, in part, to the existence of communiqué, Brazil, Chile, Cuba, conditions of poverty, marginality Ecuador, Norway and Venezuela and weak institutional presence, will be the guarantor states of in addition to the existence of the process. Moreover, the former criminal organizations dedicated to Commissioner for Peace Frank Pearl drug traffi cking [...] The production and the ELN's second in command, and commercialization of illicit Eliécer Erlinto Chamorro Acosta, drugs and the criminal economies also known as "Antonio García", have had severe effects on the would be the chief negotiators.

7 THE SECOND TERM CHALLENGES FOR JUAN MANUEL SANTOS IN COLOMBIA

AUTHORS

Paola Gómez is Account Manager in LLORENTE & CUENCA Colombia. Social Communicator – Journalist graduate from the Universidad Externado of Colombia. She has 9 years of professional experience in the area of Corporate Communication, CSR, Marketing, Crisis, Internal and Corporate Communications. She has designed and implemented communication strategies for clients such as CCX, AUX, Diaco, Gas Natural, Cerrejón, Gerdau, Jerónimo Martins, Grupo Gilinski, Unilever, Bavaria SABMiller, Deloitte, Nortel, Presidential Advisory Offi ce on Special Programs of the Presidency of the Republic, Profamilia, Colombian Red Cross, AVON, Oceisa, Telefónica, Microsoft and Abbot, among others. [email protected]

Diego González is Junior Consultant in LLORENTE & CUENCA Colombia. He is a Social Communicator and graduated in Journalist in the University of La Sabana, specialized in Strategic Communication in Sergio Arboleda University; he is also graduated in Communication and Political Marketing in the University of La Sabana. He acquired a great experience on Organizational Communication thanks to his contribution to communication and trade agencies such as CMS-Communication & Marketing Solutions, Openmind Networking and the Foundation for Press Freedom (FLIP). [email protected]

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