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BOGOTA, May 6 (Reuters) – Colombia’s independent fiscal watchdog will suspend monitoring of public finances and stop issuing \u200clegally mandated opinions in November after the government \u200creduced its operating budget, the committee’s president warned on Wednesday.<\/p>\n
The move could negatively \u200bimpact investor confidence in public debt markets and credit rating agencies’ assessments as Colombia faces fiscal deterioration that has increased its debt burden, analysts said.<\/p>\n
\u2022 The finance ministry allocated the \u200cAutonomous Committee of \u2060Colombia’s Fiscal Rule (CARF) funding for 10 of 12 months this year, an 8% real budget cut \u2060while the ministry’s own operating budget grew 8%.<\/p>\n
\u2022 CARF would first stop monitoring public finances and eventually stop issuing mandatory \u200blegal opinions, \u200bits President Juan Carlos \u200bRamirez told Reuters.<\/p>\n
\u2022 The ministry \u200cassigned CARF a budget of 2.23 billion pesos (about $600,000) for this year.<\/p>\n
\u2022 Operating at minimum staffing levels will prevent functioning in November and December, Ramirez said.<\/p>\n
\u2022 The finance ministry did not immediately respond to a request for comment about the \u200cbudget cut.<\/p>\n
\u2022 President Gustavo Petro, \u200bwhose term ends in August, has \u200bpreviously criticized CARF’s recommendations \u200babout the country’s deteriorating finances.<\/p>\n
\u2022 In late \u200cApril, CARF warned the next government \u200bmust cut \u200bspending by four percentage points of GDP, equivalent to 74.1 trillion pesos ($19.9 billion), to avoid default.<\/p>\n
\u2022 Last year, \u200bthe government suspended \u200cthe fiscal rule for three years to be able \u200bto increase the deficit despite CARF’s recommendation against \u200bdoing so.<\/p>\n
(Reporting by Nelson Bocanegra)<\/p>\n<\/p><\/div>\n