Economy
From The Report: Colombia 2014
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Despite the global vagaries of the mining business and potential volatility in hydrocarbons, a combination of economic liberalisation, free trade agreements and entry to a variety of trade blocs has assured steady growth for Colombia over the past few years. After expanding 6.6% in 2011 and 4% in 2012, Colombia’s economy experienced a slowdown during much of the first half of 2013, registering GDP growth of just 2.6% in the first quarter. Nonetheless, the sound performance of the construction sector, along with strong public investments, recovery in the hydrocarbons industry and restored consumer confidence, allowed Colombia to finish 2013 with solid growth of 4.7%. While the first quarter of 2014 displayed a slight slowdown, with GDP expanding by just 2.9%, large-scale investments in infrastructure point to continued growth in 2014, with the central bank forecasting GDP to expand by 5%. This chapter contains interviews with José Ángel Gurría, Secretary-General, Organisation for Economic Cooperation and Development (OECD); Enrique García Rodríguez, Executive President, CAF development bank of Latin America; and José Darío Uribe, Governor, Central Bank.
Articles from this Chapter
Construction sector’s performance is supporting continued growth
OBG talks to José Ángel Gurría, Secretary-General, Organisation for Economic Cooperation and Development (OECD)OBGplus
Interview: José Ángel Gurría What kind of impact will the OECD accession process have on the progress of reforms within Colombia? JOSE ANGELGURRÍA: Colombia’s accession process to the OECD will serve as a catalyst for important economic and social reforms on issues such as taxation, health and the environment. The OECD’s 23 committees will be able to use their expertise to make recommendations on how Colombia can move closer to best practices in their respective areas. Membership…
OBG talks to José Ángel Gurría, Secretary-General, Organisation for Economic Cooperation and Development (OECD)OBGplus
Interview: José Ángel Gurría What kind of impact will the OECD accession process have on the progress of reforms within Colombia? JOSE ANGELGURRÍA: Colombia’s accession process to the OECD will serve as a catalyst for important economic and social reforms on issues such as taxation, health and the environment. The OECD’s 23 committees will be able to use their expertise to make recommendations on how Colombia can move closer to best practices in their respective areas. Membership…
Investment in Colombian sovereign debt has regained its popularity despite crises in other emerging marketsOBGplus
Colombian sovereign bonds have once again proven their attractiveness to international investors. The popularity of these instruments has been demonstrated by the interest shown by credit institutions, pension funds, foreign investment funds, and insurance companies, which made significant investments in the country’s treasury securities during a February 2014 issuance. This marked a rebound in demand from institutional investors, who purchased a total of COP1trn ($500m) of government debt that…
Regulatory reforms are being driven by a desire to join the OECDOBGplus
In mid-2013, one of the central objectives set by the government of President Juan Manuel Santos Calderón began to be realised. Colombia first applied to join the Organisation for Economic Cooperation and Development (OECD) in January 2011, and in May 30, 2013 the body’s secretary-general, José Ángel Gurría, formally invited Colombia and Latvia to take the steps necessary for their inclusion in the group of countries. Although Gurría stated that Colombia’s entry into the OECD is feasible…
OBG talks to Enrique García Rodríguez, Executive President, CAF development bank of Latin AmericaOBGplus
Interview:Enrique García Rodríguez What can Latin America learn about economic integration from the history of the EU? ENRIQUE GARCÍA RODRIGUEZ: Europe has made a great political effort over the years. This continuity is one of the factors in the success of the EU’s integration, compared with Latin America whose own efforts since the late 1950s have not been fully sustained. The EU managed to establish strong supranational institutions that can resolve differences among its members.…
OBG talks to Enrique García Rodríguez, Executive President, CAF development bank of Latin AmericaOBGplus
Interview:Enrique García Rodríguez What can Latin America learn about economic integration from the history of the EU? ENRIQUE GARCÍA RODRIGUEZ: Europe has made a great political effort over the years. This continuity is one of the factors in the success of the EU’s integration, compared with Latin America whose own efforts since the late 1950s have not been fully sustained. The EU managed to establish strong supranational institutions that can resolve differences among its members.…
Developing talents: Education and training initiatives aim to boost formal employment for young peopleOBGplus
Between March and May 2014, young people between the ages of 14 and 28 accounted for 32.5% of the working age population, according to the National Department of Statistics (Departamento Administrativo Nacional de Estadística, DANE.) In total, Colombia has about 11.9m young people. Yet factors such as informality, a significant mismatch between educational curricula and the demands of the labour market, and insufficient technical preparation act as barriers to the professional progress of many…
OBG talks to José Darío Uribe, Governor, Central Bank of ColombiaOBGplus
Interview:José Darío Uribe What level of inflation is the central bank aiming for, and what would trigger an interest rate increase? JOSE DARIO URIBE: Levels of inflation in Colombia are at the lower end of the 2-4% target range. We are aiming at the 3% midpoint; currently, inflation is at levels above 2%. Our predictions for inflation vary between 2.5% and 3% based on different scenarios. While we recognise that Colombia's economy has a slightly negative output gap, it is not at a worrisome…
OBG talks to José Darío Uribe, Governor, Central Bank of ColombiaOBGplus
Interview:José Darío Uribe What level of inflation is the central bank aiming for, and what would trigger an interest rate increase? JOSE DARIO URIBE: Levels of inflation in Colombia are at the lower end of the 2-4% target range. We are aiming at the 3% midpoint; currently, inflation is at levels above 2%. Our predictions for inflation vary between 2.5% and 3% based on different scenarios. While we recognise that Colombia's economy has a slightly negative output gap, it is not at a worrisome…
Public-private partnerships begin to pay off despite limitationsOBGplus
In January 2012 the government of President Juan Manuel Santos Calderón issued Law 1508 on publicprivate partnerships (PPPs), better known as the PPP law. More than two years later, the results of the muchtrumpeted announcement have yet to match the fanfare surrounding their launch. The promotion of PPPs could contribute to the development of infrastructure, which is “an absolute necessity in the country”, as Alejandro Arboleda, general manager of Pedro Gómez Infraestructura, a local leader…
A new generation of emerging marketsOBGplus
Emerging markets have commanded the world’s development focus for the past two decades. In particular, four developing countries gained a key position since the start of the 21st century. The retiring chairman of Goldman Sachs, Jim O’Neill, was the first to consider Brazil, Russia, India and China the most powerful emerging markets in 2001 and call them the BRICs. Now these countries are slowing – especially China and Brazil – while new markets arise. Brazil has been downgraded by Standard…
Regional integration has helped strengthen trade tiesOBGplus
The global economic recession that began in 2008 has underlined the significance and strength of emerging markets, and highlighted regions that were previously in the shadows. In addition to developing in their own right, Latin America and South-east Asia rapidly recognised their potential as trade partners. On April 28, 2011 a regional initiative was launched in the Peruvian capital, Lima. The Pacific Alliance (PA) was created with the objective of integrating the economies of Peru, Colombia, Chile…
