Wednesday, Jun 26, 2019
Infrastructure | Government | South America | Colombia

Housing in Colombia

'I have a duty in the financial area and it is to promote home ownership for Colombians'

4 years ago
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Mr. Augusto Posada

President of National Savings Fund

Colombia is going through an exceptional moment, its macro economy has been growing for years and it is now facing clear objectives as explained by President Santos, which are peace, education and equality.

The President has stated that the peace process is actually on its last stage, while on the last Peace Forum in Madrid all of the international experts commented on the fact that this process has reached an irreversible phase. What is your opinion on this matter?

Today, as President of the Fund, I have a duty in the financial area and is to promote home ownership for Colombians. I have been in the Congress of the Republic eight years, and by the time I got to be President of the Chamber and having the opening session on my charge, conversations on peace had already been taking place secretly for a year, and I have to say that either from my position as a Congressman or today here, I have always believed in the process. Imperfect as it could be, I think that no peace or process could never be consolidated through a rifle but at a negotiation table, where obviously differences can be discussed and reach agreements. I think that we are at an irreversible stage, even when details were known by the Colombian people –such as the fact that their leader was taken down-, the FARC guerrillas still maintain the desire for peace. For me that was a definitive sign of spirit and peace intention towards laying down their arms and reinstating to civilian life, and that is really important. I simply express my complete support and agreement on the way that this process has been managed.

Colombia has one of the largest base growth in Latin America, and in this regard the World Bank has placed the country as one of the most interesting economies to invest in the region in occasion of its 2014 edition of ‘Doing Business’. Fortune, also places it among the seven most interesting to invest around the world. Where do you see Colombia in 2018?

Newsweek and other publications have been placing us and seeing our progress for the past six or seven years, and has appointed us as one of those internationally relevant emerging business economies. And this is all due to a process of bilateral negotiations, an orthodox and judicious management of the economy, inflation control and increased per capita income of Colombians, which already stands at an average of 8,000 dollars. This is not only about macroeconomic indicators, it is also about the country's infrastructure. Colombia has an irregular, really complex geography, and we realized that if didn’t have routes and settled infrastructure, we would hardly be competitive. Currently, we are taking improvements in access, airports, waterways and roads, which of course gets our country in the best of conditions, for both importing and exporting our products. Bilateral agreements are the ultimate way when they are all about negotiating how both parties could benefit and I think this formula has achieved great results. I see Colombia in 2018 as the leading country in Latin America, with one of the highest rates of economic growth in the continent. We could even compare with many countries in the world, in Asia, in Africa or Europe. Maybe truly exceptional conditions are being given for Colombia to no longer be just a promise of emerging country, but a country that begins to affect world’s business and economic development.

You are investing 790 billion, with Vice President Vargas Lleras as a general coordinator for this process. How is infrastructure going to improve Colombia’s competitiveness?

I think what drives President Santos to work for peace in this country is his true and authentic love for the Colombian people and the territory. I do not say this because I work as an officer of this government, but because I have witnessed his devotion to these goals through many years since he was Minister and now as President of the Republic. A country cannot be able to achieve peace by simply signing a document, but when it also reaches equity, equality between its inhabitants and to accomplish all that, economic development is required. And if we have adequate economic development, we will create better conditions for coexistence and that is what we call peace. President Santos before as Minister and now has always understood this reasoning and said: if we do not insist on investing in infrastructure, in development, we would hardly grow on competitiveness, there is no doubt about it. The improved roads are not meant to drive faster, they are conceived so goods could get to different destinations in a more secure, appropriate and prompt way, either they are for export or import. This kind of infrastructure policy generates employment, given the workforce needed to build all these projects and preserve them. Also development comes up along the sides of the roads, cities and everything that is being built. So I do believe that President Santos will be remembered not only for achieving peace, but for consolidating the development and peace in the country, which is of course possible through infrastructure improving.

Housing is the largest employment generating industry, last year it reached a record figure and its growth rate is expected to keep on expanding for the next years. What is your appreciation on this business?

I find this first semester incredibly dynamic, and this is because building houses involves all of the social development that is generated when a person who never had the opportunity of acquiring a house becomes owner of a home. But there is also alternative development when appliances, housing are purchased. This has definitely pulled and will continue for years to come. I believe that the country's growth will continue to be double-digit and that is what we are betting our expectations on. There is a great inequity in the country, and we can make the difference and end this situation by encouraging private property as an elementary goal.

We would like to ask for your description on this matter and get to know what it means to the Fund the recently achieved rating.

To the Fund it means the trust of one and a half million affiliates, the confidence in the way that we are running their resources and the certainty that we are doing whatever possible to turn that savings into house property. I am very satisfied with all the changes we are going through at the Fund given the fact that we are the second savings management company and that means a great responsibility to keep on managing the Colombian workers resources and turn them into housing and education.

During the term of your tenure, what challenges and responsibilities is the Fund assuming?

We have the responsibility of keep on supporting the country’s housing infrastructure goals. It is 400,000 houses, and we have along with the Government a commitment in developing 25% of them in the next four years, which means a total of about 75,000 homes. We are now facing a housing deficit of nearly 750,000 units, which we are gradually cutting down.

What is the importance you give the National Savings Fund as an equity generating actor?

Equity is peace, social harmony. That is why all of our efforts are directed not to present a balance sheet that shows our coffers full at the year-end, but to say how much we contributed to the country equity building through housing ownership or access to decent education.

Poverty is actually reducing, these rates are continuously improving. As the President of the National Savings Fund, what kind of opportunities do you think that the growth of middle classes is going to bring to Colombia?

First, I would like to say that just one Colombian living in extreme poverty is too much. That means that this struggle has no end and that we have to keep it up until none of our citizens left out of decent education, nutrition, life and that is an everyday job, our mission and goal. The National Savings Fund purpose is to create the necessary mechanisms working all together with different state agencies such as the National Prosperity Department, National Planning, Ministry of Education, Ministry of Housing, seeking to guarantee housing for all those that have been relegated from that benefit until now.

You became a key player in order to achieve the goal of making out of Colombia the most educated countries in Latin America by 2025. What importance does the National Savings Fund have to the support education through the education credits you endow?

We are now developing a new education program, which will be announced by the President any time soon. We do not subsidize education, we actually finance it through a credit line that constantly challenges us to guarantee the lowest interest rate in the market. Currently we are in the second position right after the public entity, ICETEX, and we are going to continue working on reducing those rates so more Colombians have access to education.

What is the importance you confer to the team? What would you say are the strongest attributes of the human group behind the National Savings Fund? What is yet to improve?

The Fund is based on a wide commitment with all the Colombians because we know what the social mission of the Fund itself is. This mission is about the effort in being able to deliver equity, education, housing, to our affiliates. Our potential is brought by love and commitment to that mission. We have to improve in deliver a better service. We deal with the social pyramid base, the poorest people in this country and I think that the less opportunities our affiliates have, the better is the service we should afford them.

You are also focusing on the international diaspora through the program called “Colombians Abroad”, what importance does the National Savings Fund have for all those Colombians that love their country but are still living in foreign places?

It is a huge challenge. The program has not been officially launched yet but it already counts with over 200 Colombians saving abroad and have assigned three housing credits. I have great hopes on this program, given that it mainly aims to make it easier to all those Colombians that want to come back to be able to enjoy their capital and patrimony once they have returned to the country. It is not easy either economically, but this effort will be continued while we consider it vital the way we do.

The main commercial partner and also historical geopolitical ally is the United States. What possibilities do you see to diversify and intensify those relations?

Many years ago Latin America was seen as America’s backyard. I think that given all the way we have come in cultural dialogue, it becomes apparent that richness and prosperity are generated when we work jointly. What I have always felt is a great collaboration between the two countries fighting against drug trafficking, against terrorism and trying to achieve peace. For me it is fundamental that the United States have an ambassador in the negotiations: that does not mean to be intrusive given that violence and war in Colombia affect the whole continent. So, the destiny of this relationship is to keep on working like brothers the way Colombia and America always did, it is a bond that never could be broken.

Colombian diaspora in the United States is about 1.3 million people. What possible paths do you see for Miami and Colombia relationships?

We live in a global village and we will be increasingly connected each day. Human resources exchange is permanent and that is because we are completely connected. At the same time, and thanks to that connection, businesses and opportunities rise on both sides of the tie. 




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