As regards the external situation, there is expected to be a sharp reduction in the current account balance of payments deficit in 2000, followed by a slight increase in the following years because of lower oil exports, but which should in any case be at about 3 percent. This is considered manageable as such a level can be financed through long-term resources and foreign investment. With respect to public finances, reducing the fiscal deficit cannot be postponed any longer and the financial programme envisages a deficit of 3.5 percent in 2000 compared to 4.6 percent in 1999, with further reductions to 2.5 percent in 2001 and 1.5 percent in 2002. However, the symptoms of revival are still incipient and the process of recovery is expected to be slow and entail certain costs. Clear and stable rules and regulations are needed to produce a better business environment and a consequent strengthening of domestic and foreign investment.
Economic stability is also fundamental to encourage savings.
Another aspect linked to economic revitalization that cannot be neglected is the need to generate conditions for the flow of credit to the productive sector. As regards the fiscal situation, the structural reforms to public finances which will be debated in Congress are vitally important. Although the statistics for the wood and furniture sector have not yet been consolidated, everything suggests that this sector maintained its downward contribution to GDP, in part because of the crisis in the construction sector in the last three years, with some 17 percent of construction demand for inputs being for wood products. Within the forest industry processing sector, which includes the wood and furniture and the paper and newsprint sectors, the latter's GDP share is more than double that of wood and furniture. The Colombian pulp, paper and paperboard industry performed better than the industrial average and indeed better than the economy as a whole.