| Summary: | This paper presents Colombia’s Review under the Flexible Credit Line (FCL) Arrangement. Colombia has very strong economic fundamentals and policy frameworks anchored by a credible inflation targeting regime, a solid medium-term fiscal framework, a flexible exchange rate, and effective financial sector supervision and regulation. The authorities remain firmly committed to sustain their record of accomplishment of implementing very strong policies and maintain such policies in the future. External risks remain elevated and tilted to the downside. Global financial conditions could become more disorderly with negative effects on commodity prices and growth. An escalation of Russia’s war in Ukraine could disrupt trade and financial flows. Contagion from the international banking sector turmoil could adversely affect economic and financial stability, although continued strong oversight will likely temper these effects. The arrangement under the Flexible Credit Line has and will continue to reinforce market confidence and provide added insurance against external risks
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