Economical overview
Colombia has a diverse and strong economy. It
has traditionally been based on agriculture, but the
industry is well developed. In recent decades,
large-scale exploitation of oil and coal has also
occurred. However, this development has been hampered by
civil war, and drug trafficking and smuggling are in
parallel with the legal economy.
Reduced violence and peace talks (see Current policy)
have contributed to good economic growth and increased
investment. The picture of Colombia has changed in part,
from war-torn drug states (see Modern History) to
attractive investment and tourism destinations. But
major challenges remain, with, for example, large income
gaps, unfair land distribution and lack of
infrastructure. The security situation also continues to
pose a constant challenge.
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Countryaah.com:
Major imports by Colombia, covering a full list of top products imported by the country and trade value for each product category.
Coffee, tobacco and bananas were early Colombia's
major export products. A strong industrial base was
built up when Colombia long protected its own production
through high tariffs and other import barriers. For a
quarter of a century until 1997, Colombia had
uninterrupted growth. In Latin America, the country was
alone about it and about not needing debt relief in the
1980s.
In the early 1990s, trade policy changed. Customs
were lowered, foreign investors were given favorable
terms, the economy was liberalized and many large state
companies were sold out. Consumption increased and
growth accelerated. Inflation, which was above 30
percent, began two decades of steady decline.
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Abbreviationfinder.org: Check this abbreviation website to find three letter ISO codes for all countries in the world, including COL which represents the country of Colombia.
IMF loans
Gradually, the economy slowed down, and in 1999 GDP
fell. The currency, the peso, was allowed to flow
freely, and inflation was attacked. A slow recovery of
the economy followed. Loans from the International
Monetary Fund (IMF) came against the promise of reduced
budget expenditures, increased tax revenues, sales of
more state-owned companies and increased trade with the
outside world.
President Álvaro Uribe (2002–2010) tightened the
economy. He raised some taxes to be able to increase
military efforts against the guerrillas while reducing
the budget deficit. Security improved in the cities, and
more investors dared to invest in Colombia. In addition,
oil prices rose during Uribe's time in power (see
Natural Resources, Energy and Environment).
GDP has generally increased since the turn of the
millennium and was positive even in 2008–2009, which was
the worst year of the global financial crisis. When the
economy showed signs of slowing down after 2011, the
central bank responded with Latin America's lowest
interest rate and President Juan Manuel Santos's
(2010–2018) government presented a stimulus package of
SEK 16 billion.
Changing prices
The fluctuations in world market prices for important
export products such as oil, coal and nickel have a
major impact on the economy. The dependence on oil and
coal has led to problems in recent years, as world
market prices for both have fallen sharply. The coffee
has also lost value while bananas have become an
important export product. Colombia also sells a lot of
cut flowers - not least roses - and cotton, sugar and
tropical fruit are significant in exports.
Colombia signed a free trade agreement with the
United States in 2006. The agreement ended up in the US
congress because of concerns over violence against trade
unionists in Colombia (see Labor Market). In May 2012,
the agreement came into force but was followed by major
protests in Colombia (see Calendar), where many feared
that small farmers and small-scale industries would be
eliminated.
Since August 2013, Colombia also has free trade
agreements with the EU. For the EU too, the lack of
protection for the unions was a sensitive issue. The EU
negotiated the right to some transparency and inspection
of conditions. But trade unions in Colombia are
skeptical and say that the state does not live up to its
commitments, and that the security situation in the
country is still very poor. The EU agreement was also
followed by extensive protests (see Calendar).
Illegal activities
Illegal trafficking in cocaine and marijuana covers
several billion dollars a year. The drug is smuggled out
of Colombia with mainly the US as a market. In return,
large quantities of goods are smuggled into Colombia as
part of money laundering from trafficking in drugs,
weapons and people. The smuggling damages the legal
business and makes Colombia's normal economic
development difficult.
According to experts, the value of money laundering
can be as high as $ 17 billion annually, which is more
than 5 percent of GDP and more than foreign direct
investment.
FACTS - FINANCE
GDP per person
US $ 6,651 (2018)
Total GDP
US $ 330 228 million (2018)
GDP growth
2.7 percent (2018)
Agriculture's share of GDP
6.3 percent (2018)
Manufacturing industry's share of GDP
11.3 percent (2018)
The service sector's share of GDP
57.8 percent (2018)
Inflation
3.6 percent (2019)
Government debt's share of GDP
52.2 percent (2018)
External debt
US $ 124,364 million (2017)
Currency
peso
Merchandise exports
US $ 44,373 million (2018)
Imports
US $ 49,583 million (2018)
Current account
- US $ 12 908 million (2018)
Commodity trade's share of GDP
28 percent (2018)
Main export goods
oil, carbon briquettes, coffee, gold, cut flowers
Largest trading partner
USA, China, Mexico, Brazil
2008
July
Betancourt among exempt prisoners
The army exempts Ingrid Betancourt (see June 2007), three
Americans and eleven soldiers and police held hostage by Farc. The Colombian
military has been able to track hostages using US satellites and can implement
the exemption by pretending to be relief workers.
May
Farc founder dies, new leader appointed
The guerrilla announces that founder Manuel Marulanda has died in a heart
attack. New leader will be Alfonso Cano.
AUC leaders are handed over
About ten leaders of the wounded right-wing militia are handed over to the
United States where they are charged with drug crimes and money laundering. This
probably means that the militia leaders will not be charged with human rights
violations and thus will not reveal more about contacts with leading
politicians. President Uribe says AUC leaders have broken the peace agreement
and continued to direct their criminal activities from prison.
March
Air attack against Farc in Ecuador
Colombian military bombs a guerrilla camp in Ecuador, very close to the
border. At least 17 rebels are killed, including one of Farc's leader Raúl
Reyes. This creates a diplomatic crisis with both Ecuador and Venezuela.
January
Chávez secures the release of prisoners
Venezuelan President Hugo Chávez, who for several months has mediated between
the government and Farc, manages to get the left guerrilla to release six
prisoners, including two politicians who have been held captive for six to seven
years.
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