Phasing out diesel subsidies in Colombia: A social contract perspective on stakeholder consultations

The phase-out of fossil fuel subsidies is politically sensitive and often contested, particularly in countries where fuel subsidies form an integral part of the social contract between the state and society. This paper analyses Colombia's phase-out of diesel subsidies through a qualitative case study, drawing on 32 interviews with stakeholders from government, transport, business, academia, and civil society. Using the social contract as an analytical framework, the study examines actors' perceptions of the phase-out process, with a specific focus on the government's responsibilities under the 3Ps of the social contract (Provision, Participation and Protection) in replacing diesel subsidies. Stakeholders from the passenger and freight transport subsectors view subsidies as an essential Provision within the social contract, particularly in a context of perceived institutional inefficiency and low trust in the government capacity. The government's offer to substitute diesel subsidies with alternative Provisions, such as new technologies in the long term, conflicts with the immediate Protection challenges faced by the sector. To phase out subsidies, the government would need to address the sector's priorities to build trust in its vision for a structural reform and to tackle deep-rooted, structural vulnerabilities in the subsectors that exacerbate dependence on fossil fuels. The study also reveals clientelist structures in Colombia, raising questions about the extent to which other societal groups are involved in the process (Participation) and would require support through mitigation policies (Provision). The study highlights trust-building, inclusive consultation, and structural sector reforms as critical factors in securing public support for subsidy phase-outs.