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Cablegate: Colombia: Report On Fiscal Transparency

VZCZCXYZ3054
RR RUEHWEB

DE RUEHBO #0838/01 0652255
ZNR UUUUU ZZH
R 052255Z MAR 08
FM AMEMBASSY BOGOTA
TO RUEHC/SECSTATE WASHDC 1685
INFO RUEHCV/AMEMBASSY CARACAS 0054
RUEHLP/AMEMBASSY LA PAZ MAR LIMA 5979
RUEHZP/AMEMBASSY PANAMA 1349
RUEHQT/AMEMBASSY QUITO 6630

UNCLAS BOGOTA 000838

SIPDIS

SENSITIVE
SIPDIS

EEB/IFD/OMA FOR ASNOW AND RFIGUEROA; WHA/EPSC FOR PMAIER

E.O. 12958: N/A
TAGS: EAID ECON PREL PGOV CO
SUBJECT: COLOMBIA: REPORT ON FISCAL TRANSPARENCY

REF: STATE 16737

1. (U) The following information responds to request in
reftel.

Colombian Government Efforts
----------------------------
2. (SBU) Under the administration of President Alvaro Uribe,
the Colombian government (GOC) has made significant progress
on increasing accountability and transparency. Nevertheless,
a lack of institutional capacity, narcotics-trafficking and
guerrilla violence, remain a threat to Colombia's long-term
democratic security, financial standing, and ability to
attract and maintain foreign investment.

3. (SBU) The GOC has taken significant steps to streamline
government procurement, increase transparency in public
expenditure, and ensure accountability in government
programs. In 2003, the GOC launched the "Colombia Online'
program, aimed at improving transparency, efficiency, and
clarity in procurement practices by making public the terms
of reference of bidding processes, eliminating onerous
registration costs, and updating inventories and accounting
information in real time. Today, the Unified Contracting
Portal (Portal Unico de Contracion) website
(www.contratos.gov.co) contains detailed information on all
scheduled government bids. Under Law 80, the GOC has
eliminated exemptions to open and full competitions,
incorporated public audiences in the award process, and
mandated preliminary studies to evaluate the viability of
works.

4. (SBU) The GOC also makes public on the internet both the
approved national budget as well as amendments to the budget
made during the fiscal year. The published data includes
both revenues and expenditures, in detail with regular
updates. The GOC tax administration has implemented an
extensive program since 2005 to improve the efficiency,
transparency and effectiveness of its collection system. Due
in part to this effort, the GOC recorded a 14 percent
increase in tax revenues in 2007.

5. (SBU) In 2007, the Presidential Anti-corruption Program
launched the Visible Audits Program aimed at involving
beneficiaries and local governments in the review of public
investments in health, potable water, education and housing.
The GOC held more than 150 public audiences countrywide in
2007 with a similar number planned in 2008. This initiative
has succeeded in improving the transparency and efficiency of
these investments, as well as allowed the identification of
specific cases of corruption.

6. (SBU) The GOC continues to move forward with other
measures that promote transparency, including its March 2007
announcement to join the Extractive Industries Transparency
Initiative (EITI) and the successful partial privatization of
the state-owned hydrocarbons company Ecopetrol. Amid these
measures at the national level, the central government has
begun strengthening efforts in increase accountability at the
departmental and municipal levels where a significant portion
of revenues are transferred under constitutional mandate and
where narcotics-trafficking and guerrilla violence remain a
threat to local governments and populations.

IMF Reporting
-------------

7. (SBU) The IMF has reported periodically on Colombia's
compliance with standards and codes covering transparency,
including in the areas of data dissemination, payments
systems, fiscal expenditures, and securities regulation.

U.S. Assistance
---------------

8. (U) The U.S. Agency for International Development (USAID)
supports the government's commitment to fiscal accountability
and transparency through diverse projects aimed at
institutional strengthening, increased public awareness and
improved internal controls. Between 2000 and 2006,
USAID/Colombia's Transparency and Accountability Program
supported the design and implementation of standards for
public entities to ensure the effective implementation of
internal controls.

9. (U) The USAID Transparency and Accountability Program has

supported 500 citizen oversight groups, through micro-grants,
and the creation of 6 participation centers to monitor
provision of public of public services and works. In
cooperation with the National Planning Department, USAID is
currently providing technical assistance for two pilot
efforts of Results-Based Budgeting for two Colombian
government agencies: the Colombian Family Welfare Institute
(ICBF) and the Colombian National Highway Institute (INVIAS).
Both agencies included this budgeting methodology in their
2008 budget final decree.
Brownfield

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