Colombia Peace Process 2026: ELN, FARC and Investor Risk

RioTimes Deep Analysis | Series: Latin America Guide

Colombia’s most ambitious peace initiative in a generation is running out of time. As President Gustavo Petro enters the final stretch of his term — which ends in August 2026 — his signature Paz Total (Total Peace) policy faces collapsed talks with the country’s oldest guerrilla force, stronger dissident factions, and a presidential election season that will define the country’s security trajectory for years to come.

When Petro took office in August 2022 as Colombia’s first-ever leftist president, he promised what no previous administration had attempted: simultaneous peace negotiations with every major armed actor in the country — guerrillas, drug-trafficking paramilitary successors, and urban gangs alike. Three and a half years later, the balance sheet is complicated, and the clock is running down.

Total Peace rests on a legal framework Petro signed in November 2022, allowing the government to negotiate simultaneously with rebel groups and reach justice arrangements with organized crime structures. The policy envisions land redistribution, a shift away from forced coca eradication, tax and welfare reform, and ultimately national pacification. In principle, it was designed to address the root causes of violence — inequality, lack of state presence, and the illicit economy — rather than simply defeat armed groups militarily. Early results were encouraging: violence between security forces and armed groups dropped roughly 28% in Petro’s first two years, according to ACLED analysis. But critics warned the ceasefires were being exploited — and the data proved them right.

ELN Negotiations Status: Ceasefire, Collapse, and Cautious Reopening

The National Liberation Army (ELN), founded in 1964 as a Marxist insurgency, is Colombia’s oldest active guerrilla force and the most significant test of Total Peace. The Petro government achieved a historic milestone in June 2023: a yearlong bilateral ceasefire — the longest the ELN had ever agreed to in its six-decade history — which ran until August 2024. During that period, clashes between the ELN and security forces fell to historic lows.

The process broke down catastrophically in January 2025. ELN fighters clashed violently with a dissident FARC faction in the Catatumbo region near the Venezuelan border, leaving more than 100 civilians dead and displacing roughly 55,000 people. Petro declared a state of emergency, said the ELN had “chosen the path of war,” and formally suspended peace talks, pivoting instead to active combat operations against the group.

By late 2025, signals of a possible thaw emerged. In October, Petro announced it was “time to reinitiate contact” with the ELN. In December, ELN commander Antonio García told Reuters the group was willing to resume talks — but not on a “clean slate,” insisting previously agreed frameworks must be honored. The outstanding issues include a full suspension of hostilities, an end to ELN kidnappings, and financing the peace process through a multi-donor fund. Cuba and Norway, the primary guarantor nations in previous rounds, remain available as mediators.

As of early 2026, formal talks have not resumed. In February 2026, the ELN issued a unilateral ceasefire ahead of March congressional elections — a tactical gesture, not a negotiating breakthrough. Peace Commissioner Otty Patiño stated the government’s position clearly: “The ELN must alter its approach, rethink its strategies, and fundamentally transform its criminal operations.” According to Reuters reporting on Patiño, the door remains ajar, but there is no timeline for resumption. The ELN counts an estimated 6,200 members — including combatants and support networks — and is designated a terrorist organization by both the US and the European Union.

One constructive development: in April 2025, the Comuneros del Sur — a 200-to-300-member ELN splinter group in Nariño Department — agreed to progressively disarm and replace 5,000 hectares of coca with legal crops, marking the first time in the entire Total Peace process that an armed group actually laid down weapons, according to WOLA. The community-driven, “agree and implement immediately” model used in Nariño has been cited as a potential template for future localized processes.

FARC Dissident Groups: EMC Fractures and Segunda Marquetalia

The Estado Mayor Central (EMC) — FARC fighters who refused to sign the 2016 Havana Accords — presents a different and arguably more intractable challenge than the ELN. Under the command of alias “Iván Mordisco” (Néstor Gregorio Vera Fernández), the EMC has expanded significantly since the original peace deal, now numbering an estimated 3,200 to 4,000 fighters and controlling large stretches of southern and eastern Colombia, including drug-trafficking routes into Brazil and Venezuela.

Initial ceasefires and talks with the EMC in 2023–2024 showed promise, but internal divisions proved fatal. A more dialogue-prone faction led by alias “Calarcá” (Alexander Díaz Mendoza) was willing to advance negotiations, while Mordisco’s faction prioritized military operations and rejected the political terms being discussed. The split became untenable in April 2024, when Mordisco walked away from the peace table entirely and intensified attacks on security forces — including makeshift armed drone strikes that killed civilians, a tactical escalation documented by ABColombia. Calarcá’s faction remains in active dialogue with the government, while Mordisco’s structure is subject to full military operations.

By early 2026, ACLED data showed Colombian military operations had killed at least six EMC fighters in joint army-air force-navy operations in Vaupés department targeting Mordisco’s structure, along with 18 fighters in Ituango, Antioquia. The EMC retaliated with a 35% surge in violent incidents in March 2026 compared to February, with 78% of nationally recorded armed clashes involving the EMC. A bounty of up to 5 billion pesos (~$1.2 million) has been placed on Mordisco’s capture.

In January 2026, Reuters verified a video in which Mordisco called for guerrilla unity among all FARC factions and the ELN to confront what he called US interventionism — a rhetorical escalation framed partly around US military activity in Venezuela. Colombian Defense Minister Pedro Sánchez dismissed the appeal as a strategy to protect Mordisco from military targeting.

Segunda Marquetalia, the second major FARC dissident faction founded by former FARC chief negotiators who rearmed in 2019, presents a separate challenge. Talks with the government were suspended at the end of 2024 following a schism within the group, according to the Washington Post. In March 2026, Colombia’s Attorney General’s office secured arrest warrants for seven Segunda Marquetalia members in connection with the assassination of presidential pre-candidate Miguel Uribe Turbay in June 2025 — a killing that directly poisoned the political environment ahead of the 2026 election.

Economic Impact: PDETs, Rural Development, and the Cost of Conflict

The 2016 FARC peace accord created the Territorial Focus Development Programs (PDETs) — a 15-year, $25 billion framework targeting 170 municipalities in the most conflict-affected regions. In a significant advance, Colombian Congress approved and Petro signed into law on February 12, 2026, a bill extending PDETs for a further ten years to 2037, ensuring resources continue under future governments, according to Justice for Colombia. Structural poverty in the 170 PDET municipalities has fallen from 39.8% in 2018 to 24.4% in 2024 — a meaningful but still insufficient reduction given the 12.9-percentage-point gap that remains versus the national average.

Against these gains, the macro-level economic cost of conflict remains severe. Colombia’s conflict costs an estimated 3% of GDP annually in lost productivity, security spending, and foregone investment. The oil sector is particularly exposed: key pipelines in Norte de Santander and Arauca traverse active conflict zones and have faced decades of ELN bombing campaigns. Per Argus Media, Colombia’s mining and hydrocarbon sector contracted 6.2% in 2025 — its seventh consecutive quarterly decline — partly reflecting deteriorating security conditions in key producing regions.

Private investment has been equally affected. Gross fixed capital formation fell to 16% of GDP in 2025 — down from a peak of 24.1% in 2007 — and foreign direct investment fell 14.1% in 2025, with non-oil, non-mining FDI collapsing 27.3%, per Banco de la República data cited by The Rio Times. Business groups point to regulatory uncertainty and physical insecurity as the primary deterrents — not interest rates alone. On the positive side, tourism has been one of the few sectors to benefit from post-2016 openings: the original FARC accord catalyzed significant visitor growth to previously inaccessible regions, a trend that remains fragile but real.

The cocaine economy remains the structural underpinning of armed group financing. Petro’s shift away from forced eradication toward voluntary substitution coincided with coca cultivation reaching a record 253,000 hectares by 2023. The ELN taxes coca farmers and traffickers; the Mordisco EMC controls processing routes; the Gulf Clan — Colombia’s largest criminal organization — dominates wholesale trafficking along the Caribbean coast. Armed groups have used ceasefire periods to consolidate territorial control over coca-producing areas, according to ACLED, making any lasting peace contingent on a credible alternative to the illicit economy.

Investor Risk Assessment: Sectors, Flashpoints, and the Election Variable

The risk landscape for foreign investors in Colombia in 2026 is shaped by three converging factors: a suspended peace process, a contested presidential transition, and elevated fiscal stress. Colombia’s sovereign bonds are rated below investment grade by Fitch (BB, December 2025), S&P (BB, June 2025), and Moody’s (negative outlook) — a downgrade sequence that has raised borrowing costs and, per The Rio Times, has analysts warning a fourth downgrade is probable in the April–May 2026 window unless the election produces a credible fiscal commitment.

Regional flashpoints in 2026 include: the Catatumbo area (Norte de Santander), the site of the January 2025 massacre and ongoing multi-actor conflict; the Pacific coast departments of Chocó and Nariño, contested by the ELN, Gulf Clan, and EMC splinter groups; and the Amazon basin departments of Vaupés, Guaviare, and Caquetá, which remain active theaters of Mordisco’s EMC operations and coca-trafficking competition. Projects or supply chains in these departments face elevated operational risk regardless of the peace process’s overall trajectory.

The 2026 presidential election is the most consequential near-term variable. The first round is set for May 31, with a potential runoff on June 21. Leftist Senator Iván Cepeda leads polls at 35% after consolidating the progressive bloc — including the endorsement of Senator Clara López, who dropped her own candidacy in April 2026. Centrist Claudia López (no relation) and conservative Paloma Valencia of the Democratic Center are competing as market-oriented alternatives. A market-oriented successor committing to fiscal consolidation, BanRep independence, and reopened investment pathways in energy and mining would likely reduce sovereign spreads and revive FDI. Continuation of the current policy mix without a credible fiscal anchor would deepen existing concerns. Petro is barred by the constitution from consecutive re-election; he leaves office in August 2026 regardless of outcome.

Key Events Timeline: 2025–2026

Looking Ahead: What the Colombia Peace Process Means for Investors and Expats

For investors and expats monitoring the colombia peace process, the most important takeaway is that the current period of elevated uncertainty is likely to persist through at least mid-2026 and possibly longer depending on who wins the presidency. The structural case for Colombia — demographics, natural resources, Pacific Alliance membership, US and EU free trade agreements, and a growing digital economy — remains intact. What is under pressure is the institutional framework governing the next cycle of investment and security.

A durable ELN peace deal alone would meaningfully reduce the risk premium on energy infrastructure. ELN attacks on the Caño Limón–Coveñas pipeline system have been a recurring cost for the oil sector for decades; a verified ceasefire tied to a decommissioning timeline would be a positive catalyst for Ecopetrol and foreign energy operators alike. Tourism, which boomed in previously closed regions after the 2016 FARC deal, would benefit similarly from a stabilized security environment, particularly along the Caribbean coast and the coffee region.

The paradox that ACLED identified — Total Peace reduced state-versus-armed-group clashes while allowing armed groups to grow stronger overall — underscores the limits of ceasefire-only diplomacy. Any successor government committed to lasting security will need to pair political dialogue with genuine economic alternatives in conflict zones, accelerated PDET implementation, and a credible counter-narcotics strategy that does not simply cede coca territory to armed groups under substitution programs.

The fundamental tension in Colombia’s 2026 peace calculus is unchanged: the country has the institutions, the civil society, and the international support required to achieve lasting peace. What remains elusive is the combination of political will, coherent strategy, and armed group willingness to genuinely demobilize rather than use negotiations as a tactical pause. Whether that combination emerges under the next administration will be the defining question of the decade for Latin America’s third-largest economy.