Night of the Budget Battle: How Congress Reclaimed Power in Bogotá

On the evening of September 23, Colombia’s lawmakers transformed a routine vote into a high-stakes showdown over democracy and debt.

In Bogotá’s grand chamber, legislators challenged President Gustavo Petro’s original COP 556.9 trillion ($121 billion) budget and approved a trimmed COP 546.9 trillion ($119 billion) plan.

They cut COP 10 trillion ($2.2 billion) from planned tax hikes on beer, fuel, gambling and hybrid vehicles, averting another decree-driven budget crisis by reclaiming their constitutional role.

Representative Olga Lucía Velásquez, known for bridging partisan divides, led the proposal that sat between the government’s COP 556.9 trillion ($121 billion) request and the opposition’s COP 530.6 trillion ($115 billion) offer.

Finance Minister Germán Ávila negotiated through the night to secure support. Their compromise acknowledges Colombia’s urgent fiscal squeeze—a 7.1 percent GDP deficit in 2025 and a 61 percent debt ratio—while safeguarding critical social programs.

Investors punished Colombia’s fiscal strain this summer. Rating agencies S&P and Moody’s downgraded the country’s sovereign debt, warning that weakening fiscal rules and rising deficits threaten debt sustainability.

The downgrade raised Colombia’s borrowing costs and underscored the stakes for both sides. This decisive moment reshaped the balance between executive power and legislative oversight.

Lawmakers now face raising COP 16.3 trillion ($3.5 billion) through tax reform or confronting deeper cuts and another decree. As presidential elections loom, this episode underscores Colombia’s tightrope walk between fiscal responsibility and democratic process.

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