WEEKLY REVIEW OF THE COLOMBIAN ECONOMY December 31 – January 4
Colombian Minimum Wage Increase Set at 4.02% for 2013
The Colombian government did not reach an agreement with labor unions and the private sector in negotiations on the minimum wage increase for 2013. President Santos issued a decree that unilaterally set the increase at 4.02%.
Oil Production Hits 1 Million Barrels Per Day
President Juan Manuel Santos announced that Colombia hit one million barrels per day of oil production for the first time. On December 29, 2012, the country produced 1,015,000 barrels of oil. Of note, however, is that the one million barrels was oil production for one day, not the administration’s goal of one million barrels as an average daily production for the month.
Unemployment Rate in November 2012 reached 9.2%
The 9.2% unemployment rate was the same as November 2011. According to the Colombian National Statistics Department, DANE, there were approximately 2,140,000 people unemployed in November 2012.
For complete information please visit - http://bit.ly/VojeLO
NATURAL GAS SECTOR IN COLOMBIA – BUSINESS ROUNDTABLE 2012
This is a great opportunity for U.S. companies to contact the major companies producing, transporting, marketing and distributing natural gas in Colombia. Buyers and suppliers of goods and services involved in the industrial and commercial chain of natural gas will meet at the Hotel Marriot in Bogota, Colombia on November 15 and 16. The event is hosted by Naturgas (http://www.naturgas.com.co)
Detailed information: http://bit.ly/RRP4Rr
Contact:
Jonathan Martínez, Ruedadenegocios-agendas@naturgas.com.co
Tel. (57-1) 7033197 – 8056028 -7030619 – 7030395
Carmenza Porras, cporras@naturgas.com.co
Tel. (57) 310 – 8849594
Investment Potential Sectors in Colombia
Biofuels
- Income tax exemption for ten years.
- 6.5 million hectares (16.1 million acres) suitable for biofuel production.
- World’s fifth largest palm oil producer.
- Productivity of 9,000 liters of ethanol per hectare every year.
- Growing market. By 2020, a production of 1.4 billion liters of ethanol and 1.2 billion liters of biodiesel per year.
- Assured demand. In 2020, E20 and B20.
- Creation of a “green seal” to identify the national biofuel production with good environmental and social practices.
Cosmetics
- Market of USD 2.6 million and production of USD 2.4 million.
- Cosmetics exports grew by 23% between 2003 and 2007.
- Country with the second largest flora biodiversity in Latin America.
- Market for men’s cosmetics is expected to grow 20% per year.
- Colombian women cosmetics pocket share duplicates the European average spending.
- More than 242,000 professionals and technicians available to work in the cosmetic industry.
- Manufactured products based on natural ingredients grew 9% between 2003 and 2008.
IT Services
- Over 27,000 IT graduates and 13,000 engineering graduates per year.
- Seven cities with population over 500,000.
- Neutral Spanish-speaking accent.
- Market: USD 1 billion, growing at a rate of 42% for the past three years.
Tourism
- 2.1 million foreign travellers visited Colombia in 2011.
- International tourism annual growth in Colombia (9.73%) more than doubled the worldwide growth (2%).
- Income tax exemption for new or remodeled hotels.
Medical and Health Tourism
- Pioneer Program in reproduction immunology; the first invitro fertilization baby born in Latin America; first pacemaker debveloped in the world.
- Colombia is the second best country for scientific and health infrastructure in Latin America: (IMD, 2008).
- 3,000 physicians and health professionals graduate from college each year.
MAJOR TRENDS IN U.S.-COLOMBIA TRADE: 1st Quarter of 2012
- In the first quarter of 2012, Colombia was the 21st trading partner for the U.S., with approximately $10 billion in total trade. Within the Latin American region, Colombia ranked fourth behind Mexico, Brazil and Venezuela. Total trade with Colombia grew 22% in the first three months of 2012, in comparison with the same period in 2011.
To read more, please click here: MAJOR TRENDS IN U.S.-COLOMBIA TRADE: 1st Quarter of 2012
WEEKLY REVIEW OF THE COLOMBIAN ECONOMY
Colombian Exports Continue to Grow
Foreign Direct Investment (FDI) in Colombia Up 24%
FTA News: Colombia’s ProExport Highlights Business-Matchmaking Events for U.S. Interested Parties
See the full document here: Econ Week in Review, June 4-8
Opportunity for U.S. Exporters of Electricity Generation and Solar Technologies
Colombia’s National Planning Institute for Energetic Solutions (IPSE) has just announced a $500,000 public bid for the purchase, installation and commissioning of the necessary components to complement the existing electricity generation system at the Center for Technological Innovation. The bid emphasizes the use of solar technologies. The project is located in the town of Titumate, Department of Chocó (http://goo.gl/maps/dKdH).
For more information, please see:
https://www.contratos.gov.co/consultas/detalleProceso.do?numConstancia=12-1-79717
Colombia’s Emergence on the Global Economic Stage
Our Analysis: In over 50 international visits since taking office in August 2010, President Santos has promoted Colombia as a business-friendly environment with promising investment opportunities, particularly in the energy and infrastructure sectors, as well as lobbied for Colombia’s entry into the G20, the Organization for Economic Co-operation and Development (OECD), the Asia-Pacific Economic Cooperation (APEC), and the Trans Pacific Partnership (TPP). His trips to Asia, Europe, and within the Western Hemisphere have resulted in foreign investment deals in key sectors as well as advancements of Free Trade Agreements (FTAs) and bilateral investment treaties.
By 2013, Colombia seeks 11 FTAs with over 48 countries. Its FTAs with Canada and Switzerland went into effect last summer and its FTA with the United States on May 15. Free trade agreements with the European Union and South Korea are expected in 2012. Santos’ ambitious trade agenda and economic diplomacy efforts have yielded results: GDP growth in 2011 reached 5.9 percent, unemployment in 2011 stood at 10.8 percent (one percent below 2010 levels), and FDI for 2011 totaled $13 billion, a 50 percent increase over 2010. In 2011, Colombia’s poverty rate fell by 3.1 percent and 1.3 million jobs were created. Most recently, President Santos met with investors in New York City and rang the bell at the New York Stock Exchange to signal to the world that Colombia is open for business.
Economic diplomacy has been a primary objective in over 50 official visits by President Santos since 2010. With a GDP growth of 5.9 percent in 2011, a stable macro-economic environment, and investment grade status, Santos has sought to attract foreign investment in much-needed energy and transportation infrastructure projects. Frequently accompanied by his Transportation and Finance Ministers, his visits have delivered results:
In May, Santos traveled to China where Ecopetrol, Sinochem, and the Development Bank of China announced investments in a pipeline construction project in central Colombia. Santos also promoted Colombian agricultural exports, particularly meat, to Chinese consumers. At the close of his trip, he signed an agreement with Chinese President Hu Jintao to begin considerations for a free trade agreement. During his Asia tour, Santos visited Singapore where he met with government officials as well as business executives, investors, and investment fund representatives to promote opportunities in science, technology, and innovation.
The Government of Japan gave a $250 million credit for small and medium-sized businesses following Santos’ visit there in 2011. The two governments also announced the beginning of an FTA feasibility study. President Santos visited South Korea in 2011 to further FTA talks, which are close to being finished. An agreement is expected to be signed in late June, with implementation set for late 2012/early 2013. During Santos’ trip in South Korea, a multinational steel-making company based in South Korea said it would increase investment in Colombia and a large South Korean conglomerate signed a memorandum of understanding on coal extraction with a Colombian development institute based in Medellin.
Visits to the United Kingdom (UK), Germany, Switzerland, France, and Turkey yielded investment announcements and cooperation agreements as well:
- January 2011 Visit to Switzerland: Deepening of FTA implementation.
- January 2011 Visit to France: Initiation of a financing study by the French Development Agency (AFD) concerning agricultural land rehabilitation and repairs to damaged infrastructure following severe floods in 2010 and 2011; cooperation agreements on geothermal and bio-energy.
- April 2011 Visit to Germany: Agreement on renewable energy cooperation with the International Renewable Energy Agency.
- November 2011 Visit to the UK: Announcement that Foreign Direct Investment to Colombia by the UK would be $3.4 billion in the next 3 years.
- November 2011 Visit to Turkey: Elimination of visas between Turkey and Colombia.
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Information for the above report came from different open-sourced materials, including the Colombian newspaper La Republica.
Colombia Beckons as Investment Opportunity
Our take: For those who couldn’t make the Inside Out event in NYC last week, the below Reuters article highlights a key message from the event: opportunity is here, but infrastructure is lacking. That said, the Colombian government is sponsoring several public-private partnership bids for infrastructure projects. For more information, please visit http://www.inco.gov.co/CMS/#
Regarding the record-levels of FDI for 2011, 80% was related to the extractive industries.
Colombia beckons as investment opportunity – Citi |
| Reuters News by Manuela Badawy 05/25/12 |
| Top officials from the country’s government and major state-owned and private companies were in New York and London promoting investment in Colombia’s markets that have been deemed expensive or difficult to get into. Even with an investment-grade rating and a record of $15 billion poured into the country last year, Colombia still needs to revamp and build much needed infrastructure such as airports, roads all across the country and coastal ports, according to Norena, whose company sponsored the investment promotion gatherings. The Andean country’s economy is expected to grow between 4.5 and 5.5 percent this year but its markets have a long way to go and are in need of global capital to fuel the economy further. Colombia’s free trade agreement with the United States came into effect earlier this month and is in talks with South Korea and Japan. The country has trade agreements with Canada and with most of Latin American countries, and is in negotiations with the European Union. |
| http://www.reuters.com/article/2012/05/25/colombia-investment-idUSL1E8GPDOQ20120525 |
Looking for Government Procurement Opportunities in Colombia?
Here are a few sites that might help you locate the right bid for a public procurement opportunity in Colombia.
Colombian National Navy:
http://www.armada.mil.co/?idcategoria=35616#
The State of La Guajira (northeast Colombia):
Oil and Gas Projects, “Colombia Round 2012”
WEEKLY REVIEW OF THE COLOMBIAN ECONOMY
Colombia’s Poverty Rate Drops in 2011
Colombia’s Oil Reserves Grew 9.8%
The U.S.– Colombia FTA Enters Into Force with Flowers and Harleys
Colombia’s Oil Company-Ecopetrol Overtakes Brazil’s Petrobras as LatAm’s Largest Company in Market Value
See the full document here: Week in Review May 14-18: http://bit.ly/JDkfN1
