Friday, January 13, 2012

World Bank guest speakers

Joe Jones interacts with World Bank guest speakers Geoffrey Bergen and Lars Moller, who called in from Bogota for the class's first session on political, cultural and historical contexts to Colombian development. Veronica Gonzales Stuva and faculty adviser John Ciorciari listen in. (January 13, 2012)

World Bank country economist for Colombia, Lars Moller, discusses current economic conditions in Colombia. Some of the trends are positive: GDP growth projected at more than 7%, unemployment down by a percentage point, substantial foreign direct investment. But overall unemployment is still high, and huge socioeconomic inequalities and government corruption hamper progress.

Bergen and Moller said that the Colombian government's capacity to raise taxes is impeded by an amazingly limited system. The threshold for Colombians to pay income taxes is $45,000, and even then the first 25% is exempt. Out of 44.7 million citizens, only about 800,000 pay income taxes. Clearly, this limits the government's efforts to deliver on social services. Another huge obstacle: the country's severely underdeveloped transportation infrastructure.

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