Colombia plans $6.8 billion pension transfer to state
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An employee counts Colombian pesos in an exchange house, in Bogota, Colombia July 11, 2022. REUTERS/Luisa Gomzalez
BOGOTA, Feb 25 (Reuters) - Colombia's government is seeking to transfer 25 trillion pesos ($6.75 billion) managed by private pension funds to state administrator Colpensiones, according to a draft decree from the labor ministry published late on Tuesday.
The proposal would require Pension Fund Administrators (AFPs) to move certain individual savings account balances to Colpensiones within 15 days of the decree's issuance.
The accounts belong to individuals who switched to the public system during a transition period under a 2024 pension reform now under review by the constitutional court.
The draft decree follows a separate proposal from the Finance Ministry to curb the share of pension assets invested abroad, potentially forcing funds to repatriate up to $30 billion.
Analysts say the measures could push AFPs to increase holdings of domestic government bonds as the administration grapples with a large fiscal deficit.
($1 = 3,703.28 pesos)
(Reporting by Nelson Bocanegra; Writing by Daina Beth Solomon; Editing by Sarah Morland and Brendan O'Boyle)
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