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Colombia–Unites States Trade in 2013

In 2013, Colombia ranked 20th as a destination for U.S. exports with USD 18.6 billion.  U.S. exports to Colombia increased 14% compared to 2012 – the highest increase in U.S. exports to one of its top 25 export destinations for the year.  U.S. imports from Colombia dropped 12% in 2013 to USD 21.6 billion according to the U.S. Census Bureau, while U.S. imports worldwide declined by USD 8.5 billion.   

GDP Growth Estimates for 2014

Colombia’s National Planning Department estimates the Colombian economy will grow 4.7 percent this year, based on higher inflows of Foreign Direct Investment and the growth of sectors such as transport, trade, construction, mining, and financial services.  The Colombian Central Bank projects a GDP growth between 3.3-5.3 percent. 

February Inflation 0.63%

February’s inflation was 0.63 percent, 0.19 percent higher than the rate in February 2013.  The accumulated inflation rate for 2014 is above market projections at 1.12 percent.  Education (3.82%), housing (0.61%), health (0.56%), and food (0.51%) had the highest inflation rates in February.




Differences Evolve in Colombian Economy’s 2013 Rank

President Santos has made recent public statements that the Colombian economy is now the third largest in Latin America after Brazil and Mexico.  The Colombian government may have based its statement on a recent Wall Street Journal article, which quotes a study by the British consulting firm Capital Economics.  According to the study, Argentina’s current exchange rate of about eight pesos to the dollar would result in a GDP in 2013 of USD 343 billion.  Colombia’s GDP last year would have surpassed Argentina’s at USD 350 billion, per the study.  Meanwhile, according to International Monetary Fund projections, Colombia’s economy was the fourth largest in Latin America in 2013 with a GDP of USD 369 billion, behind Argentina’s with a GDP of USD 484 billion.

U.S. Dollar Reaches 2009 Levels

As of February 27, the Colombian peso had depreciated 6.6 percent this year to an exchange rate of COP 2,054 to the dollar.  This is the highest exchange rate for the dollar since December 2009.  While total Colombian exports fell 2.2 percent in 2013 compared to 2012, experts predict exports will grow in 2014 due to the devalued peso and stable commodity prices.  The Colombian government expects total 2014 exports to surpass USD 63 billion from USD 58.8 billion in 2013.   

Inequality Levels Improve in Colombia

According to a recent study by the World Bank, Colombia’s inequality levels have decreased.  While Colombia’s Gini coefficient was 0.55 in 2008, it improved to 0.53 in 2012.  The World Bank study also noted that Colombia’s extreme poverty rate was 17.5 percent in 2012, down from 22.5 percent in 2008. 


Colombian Government Launched Oil and Gas Bidding Round 2014

On February 19, the Colombian National Hydrocarbon Agency (ANH) launched the 2014 oil and gas bid round.  With this round, the Colombian government is offering 97 blocks covering 22 million hectares, including 57 for conventional oil, 13 offshore, 19 unconventional oil and shale gas, and 8 coal bed methane.  The bidding terms of reference will be published on April 11, and companies will have until June 11 to submit proposals.  On July 8 ANH will publish the list of qualified proposals and on July 30 the list of winning proposals will be announced and contracts awarded.  For more information please visit:

Record Number of Participants at Colombia’s 50th Business Matchmaking Forum

From February 19 – 20 the Colombian trade promotion agency, Proexport, hosted the biggest business matchmaking forum in the country with almost 4,000 companies, including over 1200 international buyers and 2700 national exporters.  The event was estimated to generate USD $140 million in deals between Colombian exporters and international buyers from over 58 countries.  The Forum had a record number of U.S. companies with 323 participants, including Coca-Cola, Verizon, and Perry Ellis.  This represented the largest delegation from a single country though Canadian companies also had a strong showing with 98 participants.  This matchmaking forum began 17 years ago and now seeks to capitalize on Colombia’s free trade agreements.

 Half the Workforce in Informal Sector

The Colombian National Statistics Department reported that 49 percent of the workforce worked in the informal sector in the fourth quarter of 2013.  The biggest challenge of informal work is the lack of social security, specifically health and pension benefits.  Of those working in the informal sector, 51.9 percent were male and 48.1 percent female.  After more than a decade of double-digit figures, Colombia’s annual unemployment rate in 2013 dropped to 9.6 percent.  Reducing unemployment and informality have been priorities for the Santos administration. 


Colombian Peso Depreciation

The Colombian peso has depreciated 5.2 percent so far this year. According to the Colombian Minister of Finance, Mauricio Cardenas, the peso’s depreciation is good news for the economy as non-traditional exports are expected to grow at a faster rate with the current exchange rate of 2,030 Colombian pesos for one U.S. dollar. .  Minister Cardenas added that the depreciation has not generated inflationary problems.

Colombian Flowers for Valentine’s Day

Colombia is the world’s second largest cut flower exporter after the Netherlands, andthe United States buys 72 percent of Colombia’s total flower production.   For Valentine’s Day 2014, the Colombian flower industry exported 500 million flowers, estimated to be 12 percent of total annual sales.  According to the Colombian National Statistics Department (DANE), between January and November 2013 flower sales totaled USD 1.2 billion, a 4.3 percent increase over the same period in 2012.  Colombia’s flower industry generates 130,000 permanent jobs and it is estimated that the industry creates more than 10,000 temporary jobs just for the Valentine’s Day peak.

 Air Travel Grows 15.8%

Air travel in Colombia continues to grow.  According to the Colombian Civil Aviation Authority, air travel increased 15.8 percent in 2013 compared to recent years mainly due to higher demand for domestic flights.  The total number of passengers increased from 24.7 million in 2012 to 28.6 million in 2014.  The number of passengers on international flights grew by 14.2 percent in 2013 over the previous year.  The main reason for the increase in air travel is lower cost tickets resulting from increased competition.


Pacific Alliance to approve free trade agreement

President Santos and his counterparts from Pacific Alliance member countries (Mexico, Chile, and Peru) will meet in Cartagena on February 10th to hold the Alliance’s VIII Presidential meeting and sign the trade protocol. Once the respective congresses ratify the agreement, 92% of products will be duty free and the remaining 8% of duties will be phased out between 6 and 17 years.  The latter group includes mostly agriculture products such as beans, onions, corn and bananas, but does not include sugar.  As a result of the agreement, Colombia’s National Planning Department forecasts an additional 0.7% GDP growth, 1.4% more investment and 0.9% increased exports.

Colombia and Venezuela enter binational alliance to fight contraband

Ministers of Foreign Affairs of Colombia and Venezuela formed February 6 a binational alliance to fight contraband throughout the border, primarily of fuel, food, personal use products, and cattle.  The strategy consists of information sharing between enforcement authorities, coordinated raids, and long-term collaboration to identify alternative economic opportunities for local populations to discourage smuggling.

Colombian Central Bank maintains interest rate

During its first meeting of 2014, the Central Bank maintained its benchmark interest rate at 3.25%.  The rate has remained the same for ten consecutive months largely due to a controlled inflation rate around 2%.  The target inflation rate for 2014 has been set between 2% and 4%. 


Annual Average Unemployment Rate for 2013 at 9.6%

Colombia’s monthly unemployment rate for December 2013 reached 8.4 percent, bringing the average unemployment rate for 2013 to 9.6 percent.  The 2013 rate is the lowest in more than a decade and achieves the Santos administration’s goal of bringing unemployment below 10 percent.  There are currently 1.9 million people unemployed in Colombia.  The cities with the lowest unemployment in December 2013 were: Bucaramanga (7.7 percent), Bogota (7.9 percent), and Barranquilla (8 percent).



Colombia’s Road Concession Projects Seek Financing

The companies preselected by the Colombian National Infrastructure Agency (ANI) for the first nine concessions of the 4G road infrastructure program received a four week extension to submit their final bid proposals.  The institutions that would potentially finance the projects have said they need more time to study the concessions framework.  The first nine projects will have an approximate cost of USD 5.5 billion out of a total cost of USD 24 billion for the 4G program.  The 4G program will be implemented under the public private partnership (PPP) model and will require private companies to cover up to 25 percent of the cost of projects.  Much of that investment must be done before construction.  The nine initial projects are expected to be awarded during the first half of 2014.

 AES Corporation Seeks to Invest in Colombia

The U.S. AES Corporation may invest in Colombia’s power generation sector through AES Gener, an electricity producer and distributor in Chile in which AES Corporation owns a majority stake.  The Colombian government hopes to raise USD 2.5 billion with the sale of its 57 percent stake in ISAGEN, the state-owned energy generation company.  AES Gener’s CEO, Luis Felipe Ceron, stated the full investment may be too large for the company, which is interested in purchasing even a small share of ISAGEN.  According to press reports, the U.S. company DUKE Energy may also participate in the purchase of ISAGEN.  ISAGEN produces approximately 19 percent of Colombia’s total power. 


Industrial Production for November 2013 -0.6%

In November 2013, the manufacturing sector’s real output decreased 0.6 percent compared to November 2012.  Twenty-three of the 44 industrial subsectors recorded decreased production, with precious and nonferrous metals (-33.8%), vehicles (-23.6%), and the printing industry (-22.5%) showing the largest decline.  During the first 11 months of 2013, the manufacturing sector’s real output decreased 2.2 percent compared to the same period in 2012.  The industrial sector has been lagging since November 2012, but is expected to improve in 2014 according to the economic think tank Fedesarrollo.

Colombian Cement Company Invests in the U.S.

The Colombian cement company Argos announced its acquisition of the Newberry cement production plant in Florida, expanding its participation in the U.S. market.  Argos also signed an agreement with Vulcan Materials Company, the largest U.S. producer of construction materials, and will acquire USD 720 million in Vulcan Materials Company assets in the state of Florida.  With these latest investments, Argos will have a total production capacity in the United States of 20 million tons of cement and 17 million cubic meters of concrete per year.  The transaction must still be approved by U.S. authorities.

Colombian Government Issues USD 2 Billion 30-Year Bonds

The Colombian government made a sovereign debt issuance of USD 2 billion in 30-year bonds with a 5.65 percent interest rate.  This was the largest sovereign bond issuance made ​​by a Latin American country with such a long term maturity and the lowest interest rate ever for a 30-year Colombian bond.  The Colombian government may use the funds raised to service its external debt.  The favorable terms of this transaction were a result of the positive outlook for the Colombian economy and investor confidence in the country’s stable macroeconomic management. 


Record Sales of U.S. Agricultural Products to Colombia

Colombia’s agricultural imports from the United States reflected an increase of 37 percent from January-November 2013 compared to the same period in 2012, according to the Colombian government.  Imports during this 2013 period accounted for approximately USD 1.3 billion.  Rice had record sales of USD 48 million, an increase of 370 percent compared with 2012.  During the same period, pork imports showed an increase of 70 percent, frozen potatoes an increase of 110 percent, and chicken imports were up 46 percent. 

Colombia’s GDP Growth for 2014

According to the World Bank’s recent report on Global Economic Prospects, Colombia’s GDP is expected to grow 4.3 percent in 2014.  The World Bank predicts Colombia will have the fourth highest GDP growth in Latin America after Peru (5.5 percent), Bolivia (4.7 percent), and Paraguay (4.6 percent).  The report forecasts a 2.9 percent GDP growth for Latin America.

 Colombia’s Natural Gas Reserves Reach 15 Years

According to the Ministry of Mines and Energy, Colombia has enough natural gas to supply the country’s needs for the next 14-15.7 years.  Colombia currently has 5.7 trillion cubic feet of natural gas reserves, according to a report published by the Colombian Natural Gas Association (Naturgas).  As of September 2013, Colombia had seven million residential customers in 710 municipalities connected to natural gas, equivalent to 64 percent of Colombian households.


Colombian Macroeconomic Round Up (updated January 14, 2014)



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