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Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia The Colombian Economy.

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Presentation on theme: "Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia The Colombian Economy."— Presentation transcript:

1 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia The Colombian Economy

2 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Main facts 2 Population: approx. 46.5 million Surface area: 1,141,748 Km2 Official language: Spanish Capital city: Bogotá D.C.

3 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Index 1.GDP 2.Unemployment, Poverty and Inequality 3.Inflation and Monetary Policy 4.Fiscal Policy 5.Mining, energy, and infrastructure 6.Trade, foreign investment, and tourism 3

4 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Historical GDP Growth (%) 4 Source: World Development Indicators Historically, Colombia has exhibited a moderate, relatively constant rate of GDP growth. The only recession observed during the past decades occured in the year 1999.

5 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia GDP per capita (current US dollars) 5 Source: International Monetary Fund

6 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia GDP Growth in the Last Decade 6 Source: DANE Colombian GDP grew 5,9% 2011. Annual GDP Growth (%) 1,7% 2,5% 3,9% 5,3% 4,7% 6,7% 6,9% 3,5% 1,7% 4,0% 5,9%

7 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia GDP Growth by Regions 7 Source: International Monetary Fund The emerging markets have had higher GDP growth than advanced economies throughout the last decade. Moreover, Colombia resisted the global crisis better than the rest of its region. Annual GDP Growth (%)

8 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Composition of GDP by Demand 8 Source: World Development Indicators Composition of GDP by Demand, 2011 (% of GDP)

9 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia GDP Growth – Demand Side 9 Annual Growth in 2011-IV (%) Annual Growth in 2011 (%) Current GDP growth is led by a strong private demand. Source: DANE

10 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Household Consumption 10 Household Consumption, Annual Growth (%) Household consumption, which represents almost two thirds of Colombian GDP, decelerated during the past global crisis. However, it is now growing at pre-crisis levels. Source: DANE

11 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Composition of GDP by Supply 11 Composition of GDP by Supply, 2011 (% of GDP) Source: DANE

12 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia GDP Growth – Supply Side 12 Annual Growth in 2011-IV (%) Annual Growth in 2011 (%) Source: DANE All the sectors of the economy expanded during 2011.

13 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Mining 13 Source: DANE, ANH Mining, Annual Growth (%) The mining activity has been going through a boom during the past years, due mainly to higher oil production. Oil production (kbpd)

14 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Commerce 14 Source: DANE Commerce, Annual Growth (%) The commercial sector experienced a fast recovery following the global crisis and is currently growing at pre-crisis levels.

15 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Industry 15 Source: DANE Industry, Annual Growth (%) The manufacturing industry is also expanding, but at a slower rate than before the crisis.

16 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Index 1.GDP 2.Unemployment, Poverty and Inequality 3.Inflation and Monetary Policy 4.Fiscal Policy 5.Mining, energy, and infrastructure 6.Trade, foreign investment, and tourism 16

17 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Unemployment 17 Unemployment Rate (%) Source: DANE Colombias unemployment rate increased slightly during the global crisis, but has been recovering since. General Participation Rate (%)

18 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Poverty 18 Source: National Planning Department Incidence of Poverty (%) Poverty in Colombia remains elevated, but has been falling during the decade. The Government expects to reduce the incidence of poverty to 32% and extreme poverty to 9,5% by 2014. Incidence of Extreme Poverty (%)

19 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Inequality 19 Source: National Planning Department Gini Index* Income inequality is still elevated and has not changed much in the past decade. *: The index varies between 0 (total equality) and 1 (total inequality).

20 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Index 1.GDP 2.Unemployment, Poverty and Inequality 3.Inflation and Monetary Policy 4.Fiscal Policy 5.Mining, energy, and infrastructure 6.Trade, foreign investment, and tourism 20

21 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Central Bank Colombia has an independent central bank, Banco de la República, in charge of maintaining price stability. The central bank adopted inflation targeting in 1999. 21

22 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Annual Inflation (%) 22 Annual inflation currently stands within the central banks inflation target range (2% to 4%). Source: Central Bank

23 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Index 1.GDP 2.Unemployment, Poverty and Inequality 3.Inflation and Monetary Policy 4.Fiscal Policy 5.Mining, energy, and infrastructure 6.Trade, foreign investment, and tourism 23

24 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Fiscal Balance (% of GDP) 24 Source: Ministry of Finance Colombia has a relatively low fiscal deficit.

25 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Gross Public Debt (% of GDP) 25 Source: Ministry of Finance

26 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Main Reforms: Fiscal Sustainability The concept of Fiscal Sustainability has been included as one of the criteria in the Political Constitution of Colombia. From now on, the economic aspect will have a weight on the government spending decisions. This way, the government will be able to satisfy the citizens fundamental rights not just in the present but also in the future. 26

27 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Main Reforms: Fiscal Rule The Fiscal Rule intends to institutionalize the governments fiscal discipline. Superavitary income must be saved, and will be used to reduce the public debt or as countercaclical spending. The structural deficit must be below 1% by 2022. 27

28 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Main Reforms: Royalties The Royalties coming from the exploitation of oil and mining will have a better administration. Resources will be distributed to the regions where they are most needed, and will be used to finance proyects with regional impact. 10% of the resources will be destined to the Science, Technology, and Innovation Fund. Royalties amounted to EUR 2,860 million in 2011, and are expected to reach EUR 3,971 million in 2012. 28

29 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Index 1.GDP 2.Unemployment, Poverty and Inequality 3.Inflation and Monetary Policy 4.Fiscal Policy 5.Mining, energy, and infrastructure 6.Trade, foreign investment, and tourism 29

30 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Coal production (million tonnes) 30 Source: UPME, Ministry of Foreign Affairs *: Year to date until Q3 2011. Colombia is the largest producer of coal in Latin America and the 10th largest in the world.

31 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Renewable Energy In 2008, Colombias renewable energy production was 46,403 GWh in hydro generation, 590 GWh in solid biomass, and 54GWh in wind generation. Colombias geographical diversity makes it well suited to renewable energy production: – The Magdalena, La Guajira, San Andrés and Providencia are well suited to solar energy production. – Empresas Públicas de Medellín (EPM) has put the first windfarm into operation (Jepirachi) in the Guajira, with 15 turbines providing 19.5 MW to the National Grid. – 1.5 million tonnes of sugarcane biomass and 450,000 tonnes of rice husks biomass could potentially be used for energy production. 31 Source: Ministry of Foreign Affairs

32 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Distribution of power generation in Colombia 32 Source: XM

33 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia New concessions Current concessions New infrastructure 2012-2020 RUMICHACA NEIVA VILLAVICENCIO PUERTO GAITAN POPAYAN CALI SOGAMOSO B/MANGA CHACHAGÛÍ ESPINAL ARMENIA IBAGU E TUNJA PTO. SALGAR CÁQUEZA CALERA SOPO LA PAILA BUENAVENTURA STDER. QUILICHAO YOPAL TAME ARAUCA SISGA EL SECRETO MOCOA CARTAGO PLANE TA RICA LA YE TOLUVIEJO CRUZ DEL VISO CARRETO PONEDERA LA PAZ SAN JUAN BUENAVISTA CUESTECITAS BARBOSA AGUACLARA OCANA MANIZALES VILLET A MEDELLIN BOGOTA BARRANCAB. REMEDIO S Pto. Arimena EL TIGRE PTO BERRÍO Santa fé de Ant. Bolombolo Tres Puertas Camilo C Tunel de Occidente Over 6,000 km of new roadways will receive concessions: Approx. USD 80 billion Source: National Infrastructure Agency

34 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Index 1.GDP 2.Unemployment, Poverty and Inequality 3.Inflation and Monetary Policy 4.Fiscal Policy 5.Mining, energy, and infrastructure 6.Trade, foreign investment, and tourism 34

35 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Overall Trade Balance (USD Million) 35 Source: DANE

36 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Trade with Germany Exports to Germany experienced an annual growth of 67.8% in 2011, reaching USD 419 million (0.7% of total exports during the period). Imports from Germany experienced an annual growth of 33.6% in 2011, reaching USD 2,215 million (4.1% of total exports during the period). 36 Source: DANE

37 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Trade with Germany 37 Trade Balance with Germany (USD Million) according to DANE There is a significant difference between bilateral trade figures published by the authorities of Colombia (DANE) and Germany (DESTATIS), as Colombia reports exports according to port of destination and Germany according to country of origin. In 2011, DANE reported exports of Colombia to Germany of USD 419 million (EUR 325 million), whereas DESTATIS reported imports of Germany from Colombia of EUR 1,571 million. According to German figures, Colombia has been traditionally within the top three providers of carbon to Germany.

38 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia 3838 Free Trade Agreements In 2012, Colombian exporters will have a market of around 850 million consumers around the world. Source: Ministry of Commerce, Industry, and Tourism

39 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Foreign Direct Investment Of the total stock of Foreign Direct Investment of Germany in the rest of the world, 0.07% has gone to Colombia. In 2010, 0.01% of total FDI in Colombia came from Germany. 39 Source: OECD, Central Bank

40 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Tourism in Colombia 40 Source: Ministry of Commerce, Industry, and Tourism Number of tourists entering Colombia (thousands) 2011 was a record year for tourism in Colombia. Close to 1.6 million tourists visited the country, a record amount and a 7,3% increase with respecto to the previous year.

41 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Tourism from Germany 41 German tourists visiting Colombia Last year, 41.166 Germans visited Colombia, an increase of 39,3% with respect to 2010. In 2011, Germany became the second biggest source of tourism to Colombia from the European Union, second only to Spain. Source: Ministry of Commerce, Industry, and Tourism

42 Embassy of Colombia in Germany Ministry of Foreign Affairs - Republic of Colombia Contact data José Alzate Beauftragter für Wirtschaft und Handel Botschaft der Republik Kolumbien j.alzate@botschaft-kolumbien.de +49 30 26396110 42


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