Santos Taps Yale-Educated Ocampo for Colombia Central Bank Board

(Bloomberg) -- Colombian President Juan Manuel Santos on Tuesday appointed Jose Antonio Ocampo, a former finance minister who now teaches at Columbia University, to the country's central bank board to replace Cesar Vallejo.

Perhaps Colombia's best-known economist, Ocampo, 64, currently teaches at Columbia University's School of International and Public Affairs in New York. He holds a doctorate in economics from Yale University and has co-authored books and papers with Nobel laureate Joseph Stiglitz. Santos announced Ocampo's appointment through his Twitter account. Ocampo didn't reply to a request for comment

Ocampo, who also previously served his country as head of the National Planning Department and as agriculture minister, is perceived as a “dovish” economist, according to Sergio Olarte, an analyst at BTG Pactual's Colombia unit. Much of Ocampo's published work focuses on the need for policies to limit the adverse effects of commodities cycles on developing nations.

“He has said in the past that slightly higher inflation could be tolerated without sacrificing economic growth,” Olarte said in a phone interview. Olarte sees Ocampo as someone who's probably more favorable to lower rates.

Ocampo has argued for a more “active” use of the exchange rate and suggested that a tax on commodities exports could mitigate the deindustrialization caused by real exchange rate appreciation during the oil and mining boom.

The central bank last week unexpectedly cut its key interest rate to 7.25 percent after consumer confidence fell to the lowest level in at least 16 years and inflation slowed. It was the third straight decision that economists surveyed by Bloomberg had failed to forecast.

Central bank Governor Juan Jose Echavarria has said policy makers can still hit the 3 percent inflation target, plus or minus one percentage point, by the end of the year from the current 5.47 percent.

Santos last week appointed Gerardo Hernandez to the central bank's board to take the place of Carlos Gustavo Cano.

To contact the reporter on this story: Oscar Medina in Bogota at omedinacruz@bloomberg.net.

To contact the editors responsible for this story: Vivianne Rodrigues at vrodrigues3@bloomberg.net, Robert Jameson