Doing Business in Colombia. U.S. Department of Commerce International Trade Administration

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1 Doing Business in Colombia

2 Colombia at a Glance 3 rd largest population in Latin America Strategic geographical location Among top 50 tourism destinations in 2009 Language: Spanish (official) Literacy Rate: 94%

3 Why Colombia? An Economic Miracle Until 2009, positive economic growth Political stability Major projects Labor - Educated - Motivated

4 Why Colombia? An Economic Miracle Well managed foreign debt Frequent travelers to U.S. and Europe U.S. products preferred Growing population Photo: New El Dorado Airport

5 Why Colombia? GDP and GDP Per Capita Growth % % % % 0.00% GDP Growth GDP per capita -2.00% % % 0 Asia crisis Internal political and economic crisis ATPDEA Begins Source: DANE/IMF *GDP per capita (nominal value)

6 Why Colombia? An Economic Miracle (e) GDP (US$ bn) GDP per capita (US$) Exports (US$ bill) FOB Imports (US$ bill) FOB 2,192 2,888 3,614 3, GDP (%) 3% 6.8% 8.2% 1.5% GDP and GDP per capita Source: FMI Source: Trade Source: DANE/Comunidad Andina CAN- GDP % Source: DANE

7 Past vs. Present 1990 s Today Low investment rates Informal business management practices Security concerns Sustained investment in human resources and IT Improved Corporate Governance - Standards, CSR Improved Security

8 Past vs. Present 1990 s Today Corruption Protectionism Non- export orientation More transparency Economic liberalization Diversification of Exports

9 Challenges Social Economic Obtain a peaceful solution to the internal conflict Defeat corruption in official agencies High displacement rate Reduce poverty Large informal economy Bureaucracy and red tape Sluggish judiciary Tax evasion SMEs lack access to credit

10 Market Trends 2009 GDP growth will be flat or -1.5% Colombian Multinationals moving into Peru Acceptance of UL standards Growing internet use China/India influence growing

11 Market Trends: FTA Negotiations Agreements implemented: Andean Community (CAN) (Ecuador, Peru, Bolivia) Mercosur (Argentina, Brazil, Paraguay, Uruguay) Mexico Chile Negotiations closed: Central America Triangle (Honduras, El Salvador and Guatemala) Canada European Free Trade Association EFTA (Switzerland, Norway, Iceland and Liechtenstein) USA Current Negotiations: European Union

12 Democratic Republic Presidential and Congressional elections: May 2006 Headlines Government Will he run again? Results: Alvaro Uribe Vélez 62.2% Carlos Gaviria 22.04% Last Municipal Elections: Oct 2007 Next Presidential Elections: May 2010

13 Headlines Security Improving U.S. hostages released July 2, 2008!!! 2008 homicide rate lowest in 19 years In last 5 years, kidnapping reduced by 72%, homicides reduced by 37%, terrorist attacks reduced by 63% By 2008 government demobilized total of 47,000 paramilitary members Attacks on public infrastructure nearly eliminated

14 Best Prospects Equipment Oil and Gas Construction Mining Medical Telecommunications Plastics and Resins

15 Best Prospects Equipment/Agricultural Products Safety and Security Food Processing and Packaging Agricultural Products : Processed foods Cotton/ yarns Wheat/corn/soy/ oilseeds

16 Best Prospects Services Construction and Engineering Consulting/Legal Distribution Energy Insurance IT

17 Major Projects TransMilenio Bogota Refinery Modernization Ports Cartagena, Salgar, Buenaventura Infrastructure Ruta del Sol, satellites (3) Telecommunications National Broadband Plan

18 Market Practices Upcoming Trade Shows 2009 Waste Expo 2009 June 9-11, Las Vegas, NV InfoComm 2009 June 17-19, Orlando, FL NPE2009: The International Plastics Showcase June 22-26, Chicago, IL FIME August 12-15, Miami, FL PACK EXPO International 2009 October 5-10, Las Vegas, NV SIMA/AAPEX (Auto Equipment Exhibition) November 2-5, Las Vegas, NV for trade shows in Colombia

19 Market Practices Trade Missions 2009 State of Louisiana: March 2009 Americas Linkage: April 2009 SME Congress: May 2009 State of South Carolina: August 2009 State of Alabama: September 2009

20 Market Practices Tips for Success in Colombia Check the Clinton List /OFAC website Contact the FCS at the Embassy Identify partners/background check Use situational awareness for security Arbitration clauses in contracts

21 Contact Us Margaret Hanson-Muse Commercial Counselor US Commercial Service Bogotá Unit 5120 APO AA Tel: (571) Fax: (571)

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