Edwin Maldonado, director of the Valle del Cauca Inter-union and Business Committee, talks about the effects that the national strike has generated in the region and the tax and financial requests they made to the Government.
May 28 marks one month since the national strike began as a consequence, in principle, of the disagreement with the announcement of the tax reform project promoted by the Ministry of Finance. This reform was the trigger and the engine of a social outbreak that has also been motivated by the pandemic, unemployment, poverty and various decisions of the government of President Iván Duque.
Cali is the main scene of the mobilizations. Dozens of protests and demonstrations have taken place there, as it is worth mentioning that the capital of Valle del Cauca was one of the hardest hit cities in terms of poverty growth. According to the most recent data on monetary poverty revealed by DANE, this indicator in the city went from 21.9% to 36.6% between 2019 and 2020.
During the sessions, Valle del Cauca has also been a space for protests, human rights abuses and, in general, violence unprecedented in recent history, something that has been increasing the outrage of citizens. At another point are the businessmen of the region, victims of looting, vandalism and blockades, who ask for negotiations to return to normality and thus avoid the closure of businesses and the increase in unemployment.
Companies from the southwest of Colombia asked the Government, by means of a letter, signed by the Union Council, the Inter-union Committee of Nariño and the Inter-union and Business Committee of Valle del Cauca, to take a series of measures to alleviate the impacts that the national strike has had. about companies in this region.
Also read: Businessmen from the southwest of Colombia ask for new deadlines for taxes
We spoke with Edwin Maldonado, director of the Valle del Cauca Inter-union and Business Committee, which brings together more than 26 representative unions, 18 companies, six Chambers of Commerce and two compensation funds, to find out the requests they make to the Government, the losses and effects from the national strike and plans for reactivation.
According to the Valle del Cauca section of Fenalco (the merchants’ union), the national strike has left losses of $ 1.2 billion in the commercial sector of Cali. What losses do you record?
Unfortunately, the productive sector, which is mostly made up of MSMEs (98%), was already very affected by COVID-19. Now, with this national strike, losses of approximately $ 100,000 million a day are reported.
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Follow the news of El Espectador on Google NewsSpecifically, what are the effects that the blockades have generated in the region?
There is an impact due to business losses, not being able to move merchandise, vandalism, looting, theft and the closure of many companies. Around 42% of the companies are not working, either because the workers do not reach them, they cannot produce products or offer their services. Only about 12% of companies have been able to work fully and the rest are working at half machine. The situation is worrying, because access to goods and services that are of general interest and basic to society is being affected.
The affectation translates into not being able to mobilize products, produce and access raw materials. It is a complete closure. At the beginning there was a problem with the fuel, which has already been improving; but the supply of food products, access to medicines and the possibility of going to appointments have also been affected. We are concerned, more than the amount of the resource, the impact on the rights of people to health, mobility and work.
What consequences will these effects have on Valle del Cauca?
We believe that these losses will be reflected in the possibility of much more job loss. It may be around 200,000 jobs that are lost in the short term, taking into account that 7% of the companies in the department have stated that they are at risk of closing.
Blockades are registered in various areas of the region. What is the situation in Valle del Cauca?
We have some critical points blocked, such as access to the southwest, Cauca and Nariño. Access to Buenaventura, which is a port through which more than 50% of Colombia’s import cargo moves, affects not only the Valley but the entire country, which has not been able to get cargo. Several shipping companies announced that they will not be able to continue providing their services until the port issue is resolved. It is very worrying.
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For a company, especially a small one, doing export business is difficult because it can last between six months and a year. Those businesses are being lost because they can’t meet customers. It is still not possible to have complete control over the Buga point, which is a very important corridor because it gives access to the south of the department, to Cali, to the interior of the country and to the port of Buenaventura.
Many companies are affected and we are concerned that this crisis affects smaller companies that do not have capital, financing capacity, and the most vulnerable people, who with the increase in the prices of some basic products find it very difficult and is risk the food security of the population.
Where is the situation most critical?
Cali has been the epicenter of many acts of vandalism, looting and even burning. Blockades have been widespread, but the most serious road closures have been Cali, Buenaventura, Yumbo, Buga and Cartago. In Cauca and Valle del Cauca, problems have arisen on farms that have been vandalized and looted.
Can we speak of sectors more affected than others?
All sectors have been affected. The construction and tourism sectors have been the hardest hit by COVID-19 and are now unable to work. Our concern and the alert we want to make is about the sectors related to the food industry, health and medicines, because they are essential products. It is not that they are the most affected, but that they are a priority for the population.
There have also been problems of raw materials, worker mobility, product shipping, among others …
On the one hand, the workers do not arrive. On the other hand, the raw materials do not arrive and you cannot have the finished product. And what is achieved cannot be mobilized. It is a complete blockage of the productive apparatus. There are many examples: in construction, around 30,000 people, in the Metropolitan Area alone, have not been able to work because there is a work stoppage.
So the humanitarian corridors haven’t worked?
No. There must be a total opening of the mobilization of Valle del Cauca, because it is a very diverse department. Many economic sectors were trying to recover employment and dynamics, but this process was stopped abruptly.
What does the Inter-union and Business Committee, which groups together dozens of companies, as well as other production unions in that region, ask?
The first thing we want is for the dialogues between the government and the organizers to come to fruition and to reject the blockades, which are a form of violence, and any act of vandalism and looting. It is important that they stop this violence and allow the mobilization of people and merchandise. From the business sector we are willing to contribute so that all sectors of society participate in the construction of joint solutions to the justified needs that many sectors of the population have and that it is necessary to attend to them.
By means of a letter you asked the Government for new deadlines for the payment of taxes to alleviate the impacts that the national strike has had on companies in the region …
As of the opening, we could talk about the need for shock measures. Companies can no longer support cash flow to meet many tax court obligations. It is necessary a stimulus, support or quick relief to postpone or have discounts in this matter and a special financing plan is required for the Colombian southwest. We were already affected by COVID-19, many companies could not access sources of financing and those that did, are going to find themselves in trouble.
We need a package to improve the financial conditions of companies and that does not affect their borrowing capacity later on. There are companies that were left without capital because their premises were destroyed. They are conditions of difficult recovery.
In addition to the support measures that exist, a broader subsidy and support for the payment of social security and workers’ payroll is necessary in our region because we do not want more jobs to be lost with the blockades.
How did the national strike affect the process of economic reactivation in which the companies in the region were coming?
We were in a slow economic reactivation process. Now with the strike, which has been concentrated in the Colombian southwest, the reactivation stopped and the cash flow problems of the companies increased. If they don’t sell, they don’t produce, they can’t have an income.
If unemployment is lifted, what would be your proposals for economic reactivation?
You have to do a good job to meet a felt need of young people, who are the most mobilized. There may be many needs, but deep down there is the need to have a source of employment. A public-private joint must be made, so that young people can access entrepreneurship or employment opportunities. The needs of the productive sector must also be understood and, in this way, train many young people so that they can respond and have the opportunity for formal employment. For these opportunities to occur, the productive sector has to be up and running and companies have to exist to respond to the demands of society.
Another complementary proposal is to advance to another stage of COVID-19 so that isolation measures are not so restrictive and thus many sectors can be reactivated.
How do you read the strike from the Inter-union Committee?
We understand that the country has been dragging some structural and social problems, there is inequity and that cannot be ignored. As a result of the pandemic, the gaps in youth employment, gender and structural problems became more evident, the indignation and dissatisfaction of the people grew. But this outrage must be worked on in democratic terms and in dialogue to find joint solutions. This strike, although it has reasons, became something different that borders on crime, vandalism and affects the rights of others.
In addition to those you have already mentioned, what other impacts can blockages have on the business sector?
There are many impacts that cannot be measured. We do not want jobs to be lost, but there is a risk. We do not want national and international businesses to be lost. There is a risk that customers who do not have a supply from their suppliers in Valle del Cauca may decide to find other suppliers in other countries. Many companies are going to be affected in their productivity chain because they do not have raw materials, they cannot produce and this affects their reactivation, which may not be rapid.
