With 46 million consumers, the third largest GDP in South America ($322 billion, 2011 est.) and a robust free market economy, Colombia is a strong economic force in the region. Investor confidence and commercial ties with major world economies are on the rise. Foreign direct investment (FDI) has increased fivefold and exports have increased fourfold since 2000. Colombia’s economy has been growing steadily and faster than the Latin American average, and the nation is quickly becoming one of the world’s leading emerging economies. In fact, some economists have included it in a new class of growing economies – CIVETS – Colombia, Indonesia, Vietnam, Egypt, Turkey and South Africa, which are characterized by their dynamism and high prospects for growth in the coming decades.
Colombia has a growing and resilient economy. In 2009, while world GDP decreased by 2 percent, the Colombian economy grew by 1.5 percent. In 2011, GDP growth reached 5.9 percent.
Source: World Bank, World Development Indicators (Sept 2011) and Global Economic Prospects (June 2011); Departamento Nacional de Estadística (DANE).
Colombia’s inflation rate is one of the lowest in the region and continues to trend downward. At 3.7 percent, it is near its lowest level in over 50 years. Colombia is one of the few Latin American countries that has never experienced hyperinflation, nor ever defaulted on its debt.
Source: IMF, World Economic Outlook Database, September 2011, *Banco de la Republica, Final data for 2011.
As a result of its positive economic and financial performance, the three most important rating agencies (Moody's, Fitch and S&P) have granted Colombia "Investment Grade" status, highlighting:
Its ability to deal with internal and external shocks;
Long history of timely debt payments;
Increased macroeconomic policy credibility; and
Waning of security concerns.
Foreign Direct Invstment
Colombia’s outstanding economic stability has fostered foreign direct investment, and FDI inflows reached $15 billion in 2011. The United States continues to be the main source of FDI in Colombia.
Source: Banco de la República, Balance of Payments.
According to the World Bank’s Doing Business Report, Colombia is the third most “Business Friendly” country in Latin America and the top reformer in the region. The country also ranks fifth in the world and first in Latin America in terms of investor protection.
Source: Top Reformers Report, World Bank; *Positive figures show improvements in business environment climate.
Trade & Export Growth
The strengthening of economic and commercial relations is a priority for Colombia’s development. As a result, the country has implemented seven free trade agreements (FTAs) with 15 countries. By 2014, it is expected that the country will have implemented FTAs with 49 countries, gaining preferential access to 1.5 billion consumers worldwide. Colombia’s exports have more than tripled since 2000 and exceeded $56 billion in 2011. The United States continues to be the most important destination for Colombian exports.
Source: Proexport and Ministry of Commerce (2011), DIAN.