Saturday, June 24, 2017

Colombian economy 33

Published in Colombian economy Written by June 15 2017 0

The International Monetary Fund (IMF) announced in a report issued May 31 that Colombia’s economy is starting to rebound – and it’s performing much better than its neighbors following the oil-price collapse nearly three years ago.

As a result, real gross domestic product (GDP) growth would rebound to 2.3% this year, up from 2.0% last year, according to the report.

Inflation as measured by consumer price index (CPI) is expected to fall to 4.5% this year, down from 7.5% last year, while current-account deficit is seen dropping to 3.8% of GDP, down from 4.4% last year, according to the report.

“In 2016, Colombia continued a remarkably smooth adjustment to a combination of large external and domestic shocks, with economic growth outpacing regional peers and achieving further improvements in poverty and inequality,” according to the report.

While GDP growth slowed in 2016 versus 2015 due to falling oil revenues, weak demand from neighbor countries and higher inflation, “Colombia faces a favorable outlook underpinned by the peace agreement and the structural tax reform together with the authorities’ infrastructure agenda,” according to the report.

“Economic activity will rebound slightly this year as investment will strengthen boosted by reduced corporate taxation and confidence stemming from the peace agreement.

“Non-traditional exports are gaining steam in part due to ongoing efforts to reduce trade barriers and this will contribute to bring the current account deficit to its equilibrium level.

“Medium-term growth will be driven by economic diversification away from oil, which will benefit from the infrastructure agenda and the peace agreement that will improve ompetitiveness and regional development.

“Risks to this outlook are to the downside with the main near-term risk stemming from the still large (but moderating) external financing needs. Domestically, while the banking system appears sound and broadly resilient to shocks, some pockets of corporate vulnerability have emerged.

“On the upside, a faster-than-expected implementation of the peace agreement could strengthen medium-term growth even more.

“Going forward, inclusive growth will depend more on diversification supported by structural reforms including on improving infrastructure, streamlining regulation, easing trade barriers and strengthening the efficiency of public expenditure. The tax reform will boost medium-term inclusive growth by allowing a strengthening in public investment and social spending,” IMF concluded.

IMF’s near-term outlook is for a “gradual growth pickup,” according to the multilateral agency.

IMF “projects growth to increase to 2.3% in 2017 as the economy gradually diversifies away from commodities. Lower inflation will partly offset the drag on private consumption from the VAT [value-added tax] increase while investment is expected to pick up in the second half of the year.

“Credit growth will be subdued as lending standards tighten in response to somewhat weaker corporate financial strength and due to softening consumers’ credit demand. Medium-term growth of about 3.5% will be underpinned by non-commodity exports, infrastructure spending, and improved confidence stemming from the peace agreement.

“The current account deficit is projected to narrow further in 2017 and gradually converge to its medium-term equilibrium. Additional import compression due to sluggish domestic demand, improved tourism receipts, and growing non-traditional exports will reduce the deficit to 3.8 % of GDP in 2017,” the report concludes.

 

Published in Colombian economy Written by April 04 2017 0

The latest report from Colombia’s economic statistics agency (DANE) shows that Antioquia’s exports rose 14.7% year-on-year in the first two months of 2017 -- and Antioquia likewise continues to surpass all Colombian departments in total share of exports, at 19.4%.

Published in Colombian economy Written by March 13 2017 0

Thanks to the Colombian government’s recent tax reform law (see Medellin Herald on December 29, 2016), Wall Street bond rater Fitch has just decided to upgrade Colombia’s debt-risk outlook to “stable,” up from its former “negative” rating.

Published in Colombian economy Written by February 24 2017 0

Colombia’s national economic statistics agency (DANE) announced February 22 that gross domestic product (PIB in Spanish initials) grew 2% year-on-year in 2016, down from 3.1% in 2015.

Published in Colombian economy Written by February 14 2017 0

Colombia’s national economic statistical agency -- Departamento Administrativo Nacional de Estadística, DANE -- reported February 14 that its latest monthly manufacturers’ survey (Encuesta Mensual Manufacturera, EMM) shows a strong industrial rebound for full-year 2016.

Published in Colombian economy Written by January 23 2017 0

The International Monetary Fund (IMF) and the World Bank this month issued nearly identical 2.6% and 2.5% growth projections for Colombia gross domestic product (GDP) in 2017.

Published in Colombian economy Written by October 20 2016 0

The Colombian-American Chamber of Commerce (Cámara de Comercio Colombo Americana) on October 20 hailed recent advances in the “Plan Vallejo” regulatory and reporting scheme that covers imports and exports into-and-out-of Colombia.

Published in Colombian economy Written by October 19 2016 0

Colombia’s monthly manufacturing index (“EMM” in Spanish initials) rose 9.4% year-on-year in August 2016 -- the latest month for which statistics are available -- according to an October 19 report from the national statistics department (Departamento Administrativo Nacional de Estadística-DANE).

Published in Colombian economy Written by August 23 2016 0

Colombia’s national statistics agency (Departamento Administrativo Nacional de Estadística, DANE) announced August 22 that exports from various free-trade zones (“zonas francas”) soared 85.7% year-on-year in June 2016, boosted by favorable peso-to-dollar exchange rates.

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Medellin Herald is a locally produced, English-language news and advisory service uniquely focused upon a more-mature audience of visitors, investors, conference and trade-show attendees, property buyers, expats, retirees, volunteers and nature lovers.

U.S. native Roberto Peckham, who founded Medellin Herald in 2015, has been residing in metro Medellin since 2005 and has traveled regularly and extensively throughout Colombia since 1981.

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