LONDON (Reuters) - Colombia hopes to lop three zeros off the country’s peso currency, a step that might be implemented as soon as mid-2014 when the current presidential term ends, finance minister Mauricio Cardenas said on Monday.
The peso currently trades around 1900 per dollar, making it the smallest-value unit in Latin America after Paraguay’s guarani. But President Juan Manuel Santos mooted redenominating it when he took office in 2010.
“It’s a very important item on the agenda of President Santos and we are figuring out which is the right time for presenting that deal to Congress,” Cardenas told Reuters editors in an interview.
“I can tell you I have ready on my desk a draft bill of what we will present to Congress to get rid of three digits, three zeros...that’s something we would do when we consider what is the appropriate time.”
Foreign investors in Colombia often struggle with amounts that stretch to 12 zeros and are often confused about whether values are in billions or trillions.
Cardenas declined to give a concrete time frame for the step, but indicated it could happen during the current presidential term which ends in 2014. Once the measure goes to parliament, it should be approved quickly, he said.
“It’s something we will do, we’ve been working on it. It will just make life easier for everyone,” he added.
Developing countries that have slashed zeros off their currencies in the past include Mexico in 1993, Russia in 1998, Turkey in 2005 and Ghana in 2007. In the developed world, France redenominated the franc in 1960.
Cardenas said there was support for redenomination but some critics were worried about the cost of printing new banknotes. Others feared losing out because of the rounding up of prices in the newly-denominated currency.
Reporting by Sujata Rao and Carolyn Cohn; editing by Ron Askew