Colombia’s government has declared an economic emergency in response to the catastrophic 7.4-magnitude earthquake that struck the country’s west, leaving widespread destruction and prompting urgent action from authorities. President Abelardo de la Espriella, who took office just days before the disaster, announced the measure at his first press conference since taking power. It allows the executive to issue decrees with the force of law, adjust taxes and create new institutions to speed recovery in the hardest-hit regions.
Information from the latest official figures, the earthquake has caused 265 confirmed deaths, left 496 people missing and injured 3,494, while affecting more than 25,800 families. The president outlined immediate steps, including the creation of the Fondo Milagro, also called the Fondo Patria Milagro in government communications, to channel recovery financing. The fund’s basic areas of intervention include housing, economic reactivation, structural safety and the demolition of unsafe buildings.
The fund was created in September and began operating on 7 October 2026. On 22 October, the government announced an initial 624.656 billion Colombian pesos, about US$196.1 million, from a World Bank loan. The broader response also includes 377 billion pesos for economic assistance administered by the National Unit for Disaster Risk Management, 826 billion pesos from the Ministry of Housing for urban and rural housing improvements and new construction, and 2.7 trillion pesos in tax relief.
More than 332 billion pesos is earmarked for 7,385 housing interventions. In coordination with the National Federation of Coffee Growers, more than 256 billion pesos is designated to improve 5,000 homes and build 1,070 new ones; a separate 50 billion pesos is allocated for the demolition of damaged buildings. In Cali, the program includes 155 subsidies of 157,581,450 pesos each to help households buy new or used homes. The housing plan combines repairs and replacement homes with the removal of unsafe structures.
Economic recovery measures include 4.6 billion pesos for 920 grants of 5 million pesos each to small businesses and productive activities affected by the earthquake. The Ministry of Housing has also announced 2 billion pesos to support entrepreneurs and businesses in Cali and Valle del Cauca. The government has outlined a 1.7 trillion-peso reconstruction pipeline for the following two months, including about 836 billion pesos for new housing, home improvements and related development. Private-sector contributions have surpassed 1 trillion pesos, with companies and their foundations administering those projects under government monitoring.
De la Espriella emphasized that the country’s fiscal situation remains strained but insisted resources would go to the areas most in need. The emergency declaration, which follows an earlier disaster status announced on Monday, grants the government broader powers to act swiftly on tax and bureaucratic matters. The approach echoes the response to the 1999 earthquake in the same region, when then-President Andrés Pastrana established a similar legal structure and created the FOREC fund. The fund helped rebuild more than 136,000 homes and relocate thousands of families.
Political figures from both the ruling party and the opposition have supported the move, citing the scale of the tragedy as sufficient grounds for the emergency. The declaration must still be reviewed by the Constitutional Court, which earlier this year overturned a similar measure by former president Gustavo Petro under different circumstances. Humberto Tobón, a former manager of a regional administrative and planning body, has criticized the handling and timing of recovery funding. He said the Fondo Milagro was created on 17 September, while government reporting dates its creation to 9 September and says it became operational on 7 October.
Tobón also said the Finance Ministry sought access on 12 August to a US$200 million emergency credit negotiated in June 2025 by the previous government. He said the funds entered a Citibank account on 13 August and were incorporated into the national budget in September. The government argues that the disaster’s unprecedented scale justifies exceptional powers, and the president has pledged to act within constitutional and legal boundaries.
The recent earthquake also highlights the seismic risk in western Colombia. Earlier this week, a powerful tremor was felt in major cities like Bogotá and Medellín, prompting emergency evacuations and raising concerns about the country’s preparedness for such events. The current emergency measures are intended to address immediate humanitarian needs and the longer-term challenge of reconstruction.
Colombia’s legal structure allows the president to declare a state of economic emergency in cases of grave public calamity, enabling rapid intervention when normal legislative processes would be too slow. The measures’ effectiveness depends on swift implementation and oversight, particularly given the scale of the crisis. In the coming weeks, the government will have to coordinate aid and manage resources as it works to restore stability in the affected regions.
