1. Colombia’s Competitiveness Challenge: finding new engines of growth
Daniel Gómez Gaviria
Head of Competitiveness Research
World Economic Forum
March 28, 2017

2. Agenda World Economic Forum International Context
Main feature of the Colombian Economy
Challenge: productivity
Main competitiveness gaps
Competitivenss Agenda and productive development policy

3. International Context

4. Economic recovery in the United States…
USA Growth rates
Source: Bureau of Economic Analysis y WEO abril de 2016.

5. Weaker dynamism in the euro-zone
Euro-zone growth
Source: IMF – WEO april 2016.

6. End of the commodity super cycle
Commidity Index
(Base = 100 Jun 2011)
Source: World Bank Commodity Price Data (Pink Sheet).

7. Depreciation of Latin American currencies
Real exchange rate index(Base 100 = june 2014)
Jun-2014
Source: Bloomberg.

8. Falling growth rates: the “new normal”
Economic Growth(%)
Emerging Markets
China
Latin America
Source: IMF – WEO april 2016.

9. Main feature of the Colombian Economy

10. Colombia has transitioned from a low to a middle income economy
GDP per capita
(International Dollars, PPP)
Source: IMF and World Bank

11. Poverty has fallen at record rates….
Monetary Poverty
Extreme Monetary Poverty
Source: Colombian National Institute of Statistics. DANE.

12. But growth is falling… Quarterly growth Annual Growth
Source: DANE- MINCIT

13. All sector of the economy have been affected…

14. …affecting external accounts
Current Account
Source: Ministry of Trade, Industry and Tourism, OEE.

15. Why didn’t exports respond to the sharp depreciation of the peso?

16. Colombian exports according to technological content
Fuente: DANE - DIAN. Cálculos OEE - MINCIT

17. Challenge: productivity

19. Main source of problem: productivity
Relative income, TFP and Factor accumulation
15% 6%
10% 5%
-5%
-10%
-15%
-20%
18%
-25%
-23%
-30%
-35%
1960
1965
1970
1975
1980
1985
1990
1995
2000
2005
2010
Income
TFP
Factors
Source: Fernández-Arias E “Productivity and Factor Accumulation in Latin America and the Caribbean: A Database (2014 Update).”

20. The problem of growth does not come from low factor accumulation

21. Main competitiveness gaps

22. The factors and institutions that determine the productivity of a country. The level of productivity, in turn, sets the level of prosperity that can be achieved by an economy.

23. Conceptual Framework

24. Main competitiveness gaps in Colombia

25. Colombia in the GCR

26. How to prioritize?

27. Competitiveness agenda and productive development policy

28. A set of policies: National Development Plan, Competitiveness Agenda, CONPES 3866 Productive Development Policy

29. An institucional framework: National Competitiveness System

30. Thank you!
Daniel Gómez
@dgomezco