Economic overview
Colombia has worked to overcome its 1990s reputation for narco-trafficking and kidnappings and now is a Latin American economic powerhouse. The oil and mining industries drive Colombia’s economy, although labor strife, currency imbalances and weaker global prices slowed expansion in the first quarter. The economy grew 4% last year and a robust 6.6% in 2011. The government forecasts 4.5% growth this year.
Business travel industry insight
Colombia’s global economic ties have bolstered business travel. In its capital, Bogota, a city of 8 million in the center of the country, airport authorities are constructing a terminal to expand and modernize El Dorado International Airport. The new terminal is scheduled to open in 2014. Several large hotel projects also are under way. Security is not the concern it once was, but business travelers should be cautious—especially in rural areas.
Opportunities
- The government’s currency devaluation efforts have helped the Colombian peso better align with the U.S. dollar. The peso now stands at its lowest level against the dollar since the end of 2011.
- Colombia’s construction sector grew nearly 17% in the first quarter, driving expansion despite the slowdown in oil and mining.
- In addition to natural resources, the country has the geographic advantage of access to both the Pacific and Atlanta oceans.
- Labor, communications and other costs are comparatively low for the region, and that’s encouraging companies to open factories and contact centers in Colombia.
Challenges
- Colombia’s economy grew at its slowest first-quarter rate in four years because of weakness in the manufacturing, oil and mining sectors.
- The country’s infrastructure needs significant upgrades to enable sustained economic expansion.
- Unemployment tops 10%—one of Latin America’s highest rates.
- Workers in operational positions generally speak only Spanish, but multilingual workers are available for most middle- and high-level jobs.
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