BTN News: The ongoing discussions between Colombia’s cargo transporters and the Ministry of Finance have reached a stalemate over the government’s proposed increase in the price of ACPM (diesel fuel). This situation has sparked concern among transporters who argue that the suggested price hikes will severely impact their competitiveness. The government, led by President Gustavo Petro, has put forward a proposal to raise the price of ACPM by 3,000 pesos in 2024, with a similar increase planned for 2025. However, the transporters are firmly opposed to this plan, which has left the matter in the hands of the president and the Minister of Finance, Ricardo Bonilla, for a final decision. The potential consequences of these fuel price adjustments are significant, not only for the transport sector but for the broader Colombian economy as well.
Alfonso Medrano, the president of the Cámara Intergremial del Transporte (Unidos), expressed his concerns following the recent negotiations. He stated that no agreement was reached between the transporters and the government, leaving the final decision up to the highest levels of government. Medrano emphasized that the lack of consensus means that the future of these price hikes now rests with President Petro, who ultimately has the authority to implement or revise the proposed increases.
The dialogue tables between the transporters and the government have been ongoing since October 2023. During these discussions, Minister of Finance Ricardo Bonilla highlighted the need to address the substantial gap between the current price of ACPM in Colombia and the international reference price. According to Bonilla, this gap stands at approximately 6,000 pesos, which he argues justifies the proposed 3,000 pesos increase for this year and another 3,000 pesos rise in 2025. The government’s rationale for these adjustments is rooted in the urgent need to reduce the significant deficit in the fuel subsidy fund, which reached a staggering 20 trillion pesos in 2023.
Currently, the average price of a gallon of ACPM in Colombia is around 9,000 pesos. However, the government has signaled its intention to gradually increase this price to between 15,000 and 16,000 pesos per gallon. This would bring the price more in line with international benchmarks, but it also raises significant concerns for the cargo transport sector. Transporters argue that such an increase would undermine their ability to compete, both domestically and internationally, as the cost of doing business would rise sharply.
The impact of these price increases is already being felt in certain parts of the transport industry. On August 3rd, the government implemented the first phase of the ACPM price hike, which applies exclusively to large consumers—specifically, those transporters who consume more than 20,000 gallons of diesel per month. This move is part of a broader strategy to gradually reduce the deficit in the fuel subsidy fund. Minister Bonilla has stated that with the implementation of these measures, the government hopes to decrease the deficit to 12 trillion pesos in 2024. Furthermore, with additional efforts, Bonilla believes that the deficit could be reduced to as low as 6 trillion pesos in the coming years.
The transport sector, however, remains deeply concerned about the implications of these price increases. They argue that the government’s approach could lead to higher operating costs, reduced profit margins, and a loss of competitiveness. The fear is that if the cost of fuel rises too sharply, it could trigger a ripple effect across the economy, leading to higher prices for goods and services, and potentially stifling economic growth.
As the government and transporters await a final decision from President Petro, the stakes are high. The outcome of this dispute will not only shape the future of the transport sector but could also have far-reaching consequences for the Colombian economy as a whole. The challenge for the government is to balance the need to address the fiscal deficit with the equally important need to support a vital industry that plays a crucial role in the country’s economic stability.
