The fourth largest coffee producing country in the world, with Eje Cafetero (the coffee region) being pronounced a UNESCO World Heritage Site in 2011, Colombia presents an attractive prospect for doing business in. Though Colombia has been in the grips of internal conflict for more than 50 years the landmark peace agreement between the government and the FARC in 2016 promises to be a turning point in the nation’s political stability.
With one of the best macroeconomic performances in the Latin American region, the Colombian economy has steadily grown circa 3% per annum, save for the last 3 years, achieving only 1.7% in 2017, largely as a result of the drop in oil prices and subsequent devaluation of the Colombian Peso. However, forecasts now predict a gradual upturn in the economy for the coming years rendering doing business in Colombia a possible wise move for expanding companies. The major industries are oil and gas, mining, financial and professional services, and agriculture. The foreign commerce and customs legislation focuses on facilitating customs operations for imports, exports and the transit of good. Similarly the Colombian Exchange Regime promotes the internationalisation of the economy through foreign investment. Be aware, though, that the cost of trading across border is far higher than in most Latin American and Caribbean countries.
Perhaps the greatest obstacle to doing business in Colombia, corruption, remains an ever-present problem, as it continually places poorly in the world rankings from Transparency International. Bribery and other corrupt practices are not uncommon amongst business dealings and therefore it is important to be aware of a lack of transparency. Furthermore excessive red tape and soaring tax burdens could potentially impede on successful business. Other challenges include a low level of proficiency in English and the high cost of cross-border trading, though the Government has now committed itself to improving this corporate environment.
The World Business Culture website will aid and those considering doing business in Colombia to navigate the potential dangers of their business ventures in order to maximise successful outcome.