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Professional services 7

Colombia’s Ministry of Commerce, Industry & Tourism (“MinCit”) and the ProColombia export promotion agency jointly announced January 9 a new “internationalization factory” scheme that aims to expand exports – hence boosting local employment, corporate profits, resulting tax revenues and a better national balance-of-payments situation.

According to MinCit Minister José Manuel Restrepo Abondano, “through this model, entrepreneurs can adopt and improve their management and innovation skills and identify new markets for their products.”

Companies interested in participating in the new scheme may apply at: www.fabricasdeinternacionalizacion.com.co, according to MinCit.

Following registration, “a ProColombia consultant will contact the employer and make a diagnosis of the company to find opportunities for improvement,” according to the Ministry.

“With the accompaniment of ProColombia a work plan will be built, together with the company. The [product and] service lines to be developed will be selected.

“The ProColombia advisor will continually evaluate the evolution of the company to define if it requires an additional service line and/or participate in the promotional activities that ProColombia has designed.”

Qualifying participants must be “legally constituted companies” with a “defined good or service” that “produce or sell Colombian products” and are in certain industrial categories including agriculture, food, textiles and clothing, metalworking, chemicals, life-sciences and high-tech “industry 4.0” sectors, according to MinCit.

Big corporate fleets in and around Medellin and across Colombia increasingly are turning to sophisticated vehicle technologies in order to avoid accidents, cut fuel costs, avoid merchandise damage, monitor driver behavior and improve routing.

Among local fleets employing and/or evaluating novel “Mobileye” and “Ituran” systems are insurance giant Sura, cement maker Cemex, supermarket leader Exito and soft-drinks maker Postobon.

These advanced vehicle/driver/road-status technologies -- created and developed in Israel -- are being marketed in Colombia by Medellin-based Eletech SA.

In an interview with Medellin Herald, Eletech SA operations director Victor Meir Avraham explained the evolution of these technologies -- and their growing applications here in the Colombian market.

While many Colombian fleets employ relatively simple global positioning system (GPS) technologies to track individual vehicle movements, the Mobileye and Ituran technologies go far beyond those.

The more-advanced technologies incorporate sophisticated cameras, warning lights-and-sounds, facial recognition technology (detecting driver distraction and drowsiness), two-way telecom systems for emergency communications, and computer programs that automatically digest and analyze vast amounts of crucial data for relatively easy fleet-management evaluations of driver and vehicle behavior.

Bringing advanced Israeli technology to the Colombian fleet-vehicle market has proven to be a “perfect match” -- with huge growth opportunities on the horizon, Avraham explained.

Mobileye – bought by U.S. computer-technology giant Intel in 2017 for US$15.4 billion (the biggest-ever corporate acquisition in Israeli history) – gave Intel a key entryway into the vast global vehicle market, including the futuristic “autonomous vehicle” business, Avraham said.

The Mobileye technology being offered in Colombia can be used by any sort of vehicle, including cars, trucks, buses and motorcycles, he said.

Mobileye systems for distracted-driver alerts include lane-departure warning, headway monitoring and warning (to avoid tailgating and rear-end crashes), pedestrian collision warning, speed-limit detection and warning, and driver fatigue warnings, he showed.

In-development is a newer Mobileye system that eventually will detect and report potholes in roads, broken traffic lights and other highway infrastructure problems – following which these detections will be sent wirelessly to government highway departments, in real time. The same system eventually will create highway mapping systems that will be useful for the next generation of autonomous vehicles, he added.

Ituran: Telematics, Fleet-Management Analysis

While Mobileye is a stand-alone system on the vehicle, Eletech pairs it with Ituran technology, which (among various features) enables fleet managers to analyze driver and vehicle operations, with dozens of possible plug-in options.

Among the systems that can be run by Ituran is a “pin-type” keyboard that enables recognition of each individual driver of a fleet vehicle.

Yet another system -- termed “safety” -- is like an airplane “black box” that can record all safety issues, accidents and even automatically call the fleet manager operations center to report an accident (if for example the driver is knocked unconscious and hence unable to call).

Another aspect of this technology is a loop-cycle camera system that records what happened inside and outside a vehicle immediately before and after an accident. Those recordings, automatically uploaded to the cloud, can be useful for determining fault in any accident.

A plug-in cell-phone system also can be incorporated for hands-free, two-way communications between the driver and fleet management.

Yet another novel option is a cargo-bay thermometer system for refrigerated transport, which alerts the driver and fleet management of temperature anomalies that could damage goods in transit. This is especially useful for food and dairy transporters, for example.

Another system records fuel consumption, oil consumption and vehicle refueling behavior that can detect poor driving habits -- or possible diversion of fuel into a portable fuel container or another vehicle.

Yet another technology feature issues a mild warning sound for a moderate excess of vehicle speed, and a harsher sound for greater excess speed -- combined with an “eye flash” camera that monitors traffic cameras so that the fleet can avoid costly speeding fines.

The telematics system in these technologies enables a fleet manager to monitor every vehicle in real time, as well as to receive periodic, automated reports on driver and vehicle behavior, including reckless driving, excessive stop-times at pickup/delivery points, questionable refueling, prohibited stops, prohibited routes or prohibited openings of cargo doors.

“Ituran is ‘big data,’ what many call the ‘new gold,’” Avraham explained. “This is what differentiates Israeli technology” from other competitors, he added.

“Every vehicle can generate 10 gigabytes of data each month – every braking event, every acceleration, every turn, every speed, every traffic violation. But most of that is too much data” for practical fleet-manager evaluation.

“So, Ituran turns that 10 gigabytes into 40 or 50 megabytes of useful data, sent to the cloud. Not many companies can do this; it’s high-level telematics and analysis.”

For example, the recent “Vision Zero” pedestrian-accident-reduction initiative (in Europe and especially in Sweden) has been a “huge success” because of telematics analysis, he said.

These technologies gather and analyze city-wide accident data, by day and time-of-day -- and then show the high-risk areas on a computerized, interactive map, so that fleet managers can help design routes to avoid such high-risk areas at certain hours.

These technologies also identify the highest-risk and lowest-risk drivers among the fleets, by automated scoring systems showing which driver too-often drives at excessive speed, or tailgates, or aggressively brakes and steers.

The end-result: computerized “report cards” on each driver, with “green,” “yellow” and “red” computerized colors used to indicate good, mediocre and dangerous behavior. Such reports can help managers coach drivers on better behavior -- and if coaching doesn’t work, then justifiable firings can result.

Since some fleets may employ dozens or hundreds of drivers, such a computerized system can vastly improve over-all fleet operations-- and save vast amounts of management time by enabling early detection of driver-behavior trends that could lead to costly safety problems later.

On a related front, a cell-phone application available with the Ituran telematics system not only enables fleet managers to monitor and evaluate fleet-vehicle drivers, but also could enable individual car owners (such as a parent loaning a car to a son or daughter) to monitor behaviors.

Such technology is already being used in fleet applications here, but it could spread to the general population in future.

Eventually, the Ituran system also potentially could help bring about “usage-based insurance” (UBI) for individual car drivers here --still a novel concept in Colombia, in contrast to its common usage in North America, Europe, Israel and elsewhere, he said.

Colombian car insurance typically is based upon the vehicle value rather than the driver’s actual behavior, he said. In contrast, UBI analyzes personal driver risk, which could prompt insurance companies to offer premium discounts to good drivers, or penalties for poorer drivers.

“We’re trying to implement this with Sura in Colombia – it’s a six-month project, to see what best fits Sura needs for Colombian conditions” for individual car drivers, Avraham said.

“This would revolutionize Colombian transport if it applies to individual car drivers, and not just fleet vehicles,” he added.


A growing list of major local and international companies operating in and around Medellin and throughout Colombia are turning to a novel “Portafolio Verde” (“green portfolio”) consultancy here for projects that are both “green” environmentally as well as financially.

“Portafolio Verde” finds, designs and jump-starts innovative, sustainable environmental and social projects -- some of which can serve as legally required “offsets” to environmental impacts from certain industrial developments.

In a presentation to the recent Proantioquia forum here on sustainable development, Portafolio Verde executive director Alejandro Zapata cited numerous such projects over the 14-year history of the organization.

Among the newest projects are under the umbrella of Portafolio Verde’s one-year-old “Animal Bank” initiative.

“Animal Bank” helps find, develop and finance -- tapping corporate or individual-donor seed money -- suitable biodiversity projects, and then helps train local people and organizations to continue executing such projects.

Also under the “Animal Bank” umbrella is the “Tierras Con Proposito” (“Lands with Purpose”) program, which finds and then matches willing landowners with corporations seeking suitable environmental-impact “offset” projects.

“Through Animal Bank, we seek to support projects focused on conservation and biodiversity, in this way supporting social, environmental and economic development in our region and in our nation,” Zapata explained in his Proantioquia presentation here.

Candidate lands for “Tierras Con Proposito” must have biodiversity and conservation potential.

Such lands would (for example) host natural springs or wetlands; serve as “buffer zones” adjacent to environmentally protected areas; have some strategic importance such as location in highland paramos or tropical dry forest; serve as homes to threatened flora and fauna; and have potential for hosting sustainable forestry, animal husbandry, beekeeping or similarly non-destructive activities on part of the land.

Following Zapata’s Proantioquia presentation, Animal Bank and “Tierras Con Proposito” coordinator Carolina Castaño Restrepo explained to Medellin Herald in a follow-up interview many of the key underlying principles and mechanisms involved in such projects.

If for example some company proposes to develop an industrial or mining project on certain lands that are now legally declared as environmentally sensitive, then Animal Bank would help find a matching, privately-owned parcel somewhere else that either will be purchased by the corporation -- or else extended some type of finance or incentives for “green” preservation or restoration -- of some-or-all of the parcel.

Unless the land is purchased, the original owner could still keep the land -- but then avoid any sort of environmental damage such as logging, mining, cattle grazing or industrial development on specified, dedicated acreage – at very least during the term of the restoration or preservation contract.

In this sort of transaction, Animal Bank could earn a commission on what might be considered something like a real-estate deal. But there’s a difference: the main driver to the transaction is environmental protection rather than conventional “use” of an “offset” property.

“Tierras Con Proposito” could include lands that (for example) currently are partly dedicated to farming or ranching, but with at least part of the land in a natural state -- hence aiding biodiversity and environmental conservation.

One such land cited on the Animal Bank web-site is a former cattle ranch near El Retiro, Antioquia, now considered as having potential for eco-tourism. Another property historically dedicated to ranching in San Pedro de los Milagros, Antioquia, is listed on the web site for potential preservation of native forest and water resources.

While this particular parcel in San Pedro de los Milagros isn’t specifically identified on the Animal Bank web-site as a potential site for conservation of the endangered Antioquia Brush-Finch (Atlapetes Blancae) bird, it’s notable that there is now an extraordinary potato farm near San Pedro de los Milagros that just started offering birdwatching-ecotourism, with high probability of seeing this extremely rare bird at this specific site.

Other potential projects cited on the Animal Bank web-site – but looking for matching partners -- include conservation of the endangered Blue-Billed Curassow (Crax Alberti) bird as well as the endangered Andean Condor (Vultur Gryphus).

Meanwhile, a successful freshwater-turtle conservation/ecotourism project in Cocorna, Antioquia – with project design and management training provided by Animal Bank – has won financial aid from Medellin-based Grupo Argos, a multinational corporate giant in cement, electric power and highway/airport concessions.

Other founding allies of Animal Bank include Canada-based, environmentally responsible gold miner Continental Gold (developer of Colombia’s biggest new gold mine in Antioquia); the “Renting Colombia” vehicle-leasing division of Medellin-based banking giant Bancolombia; Vanderbilt University (USA); Turner Family Center for Social Ventures (USA); and corporate social-responsibility advisor B Lab (USA).

To date, "Tierras Con Proposito" has already registered 150,000 hectares of various farms and ranches in Colombia -- all ready for matching with a suitable corporate project development for environmental “offsets” or (in some cases) possible ecotourism projects.

What’s more, based on projections from the growing popularity of the program, “Tierras Con Proposito” aims to grow to a staggering 11 million hectares registered-and-ready over the next five to 10 years -- all over Colombia -- according to Portafolio Verde executive Alejandro Zapata.

Interested parties in Animal Bank and Tierras Con Proposito potentially could include all sorts of investors (not just big corporations), as program coordinator Carolina Castaño explained to us.

For example: A company, individual or an organization might be interested in developing an ecotourism hotel at a candidate site. Tapping its database, Animal Bank wouldl analyze the proposal and search for a potential, suitable site, which would include follow-up verification of the actual status of flora and fauna for possible ecotourism.

Individuals also can contribute to Animal Bank, as for example through the allied “100 Apasionados por la Fauna” group. Animal Bank asks such individual donors to contribute at least COP$3 million (about US$875 at current exchange rates) per year.

The organization also continuously employs social media, public events and news-organization interviews in order to reach-out to more landowners interested in registering their properties, as well as companies, corporations and individuals interested in collaborating on its many-varied projects.

Medellin-based, national corporate-and-individual risk-management, due-diligence and real-estate investigator Konfirma announced August 29 that its first-half (1H) 2018 revenues grew 45% year-on-year -- and the company expects full-year 2018 revenues to rise about 40% year-on-year.

In an August 29 interview with Medellin Herald, Konfirma general manager Sergio Jaramillo Mejia added that upcoming anti-corruption legislation -- backed by newly elected Colombia President Ivan Duque as well as Colombia’s main political parties – could very well provide a further boost to revenues in future years.

Konfirma has been involved in numerous Colombian “fourth generation” (4G) highway construction projects as a real-estate-value investigator-and-negotiator, including three such projects in Antioquia: “Pacifico 2,” “Mar 2” and “Conexion Norte,” Jaramillo revealed to us.

Beyond highway-corridor, public-transit and transmission-network real-estate services, Konfirma also offers reputational, financial and legal-history investigative services for both individuals as well as companies considering real-estate acquisitions, corporate acquisitions, business launches, employee hires or business partnerships. Investigative services also can probe a candidate company (or an individual) on relevant experience, quality, security and workplace safety.

For foreign investors, Konfirma also has bilingual staff available, Jaramillo told us.

Such specialized services are especially important in Colombia where anyone (qualified or not) can be a real-estate agent, where mortgage insurance isn’t yet available, where Colombian property-ownership laws and enforcement still lack clarity, where fiduciary obligations are weak, where certain properties earlier might have been seized illegally by criminal or guerrilla groups, or where government-dictated land restitutions to prior owners might be underway.

Hence investors can run huge risks by investing in properties, businesses or persons that may have criminal, illegal or irresponsible histories, Jaramillo explained.

One current example is the “Meritage” commercial real-estate development scandal near Medellin, where both Colombian and foreign investors have lost millions of dollars following the seizure of the Meritage property by Colombia’s Attorney General.

That seizure was the result of the property’s alleged ties to mafiosos (see Medellin Herald on February 02, 2018, “Colombia Supreme Court Ruling: Fiduciaries Hardly Protect Real-Estate Investors.”)  Now those investors are suing the Attorney General in an international tribunal, aiming to recoup their lost investments.

While it’s unclear what Corficolombiana (the fiduciary for the Meritage project) did or didn’t do to discover criminal-history issues -- and thus help avoid investor problems with the Meritage project -- it’s conceivable that the sort of “deep” investigations in which Konfirma specializes could have discovered problems in time to avoid investor losses, Jaramillo explained to us.

Unfortunately, Konfirma – Colombia’s largest-such investigative services company, owned equally by the Medellin Chamber of Commerce and by local “e-commerce” specialist Cadena -- wasn’t hired to investigate the Meritage project.

While Konfirma can’t offer guarantees that its “deep” investigations always would discover and hence avoid disasters like Meritage, its investigative techniques and studies nevertheless could give investors greater peace-of-mind than just the routine “certificate of tradition and freedom of the property” (“certificado de tradición y libertad del inmueble”) studies performed by realtors or fiduciaries, Jaramillo added.

Konfirma’s services also include due-diligence on companies seeking to bid on government-supervised or regulated projects, such as the “4G” highways and electric-power transmission corridors. Such services include investigations into experience and qualifications, as well as possible money-laundering, bribery, terrorism links or other legal problems that might involve candidate companies, individuals, potential employees, suppliers and counter-parties, he explained.

While Konfirma may be best-known for its government- and corporate-client services -- with some 112 such clients so far in 2018 -- the company also offers investigative services for even the smallest investors, such as those considering buying an apartment or house, he added.

One such corporate client – Colombian fiduciary Fiduprevisora – recently tapped Konfirma to investigate health-insurance plan options for a national teacher’s organization. That investigation analyzed more than 205,000 documents and helped the organization guide its decisions, according to the company.

For various clients, in 2017 alone, Konfirma analyzed 460,000 data sources -- and discovered that nearly 25,000 (4.8%) of individuals or counter-parties investigated presented reputational or legal risk, he revealed. Unfortunately, in Colombia, “there’s a relatively high level of illegal activity,” which puts investors at greater reputational and business risk, he said.

What’s more, corruption is now estimated to be robbing Colombia of an estimated 8% of gross domestic product (“PIB” in Spanish initials) – money that could better be directed for all sorts of social improvements including education, health and infrastructure, he added.

Since its launch eight years ago in Medellin, Konfirma has since expanded its operations to some 40 major and smaller cities in Colombia (including Bogota) and is now planning expansions to nearby South and Central American markets, initially in conjunction with expansion plans by Colombian-based companies, he said.

Among its numerous major corporate clients here are EPM, Isagen, ISA, Metro de Medellin, Sura, Proteccion, Bancolombia, AngloGold Ashanti, Antioquia Gold, Coninsa Ramon H, Exito, Argos, Goodyear, Grupo de Energia de Bogota, PIO, Comfama, Agencia Nacional de Infraestructura and ANDI (Colombia’s national industrial trade association), according to Konfirma.

Medellin’s novel “Ruta N” high-tech development center next to Universidad de Antioquia now boasts that it’s hosting some 135-odd companies from 22 countries (see http://distritomedellin.org/hacer-parte/) that have chosen to locate inside Ruta N itself or nearby.

Medellin’s novel “Ruta N” high-tech development center next to Universidad de Antioquia now boasts that it’s hosting some 135-odd companies from 22 countries (see  http://distritomedellin.org/hacer-parte/) that have chosen to locate inside Ruta N itself or nearby.

While a growing number of foreigners are investing in real estate or other types of businesses in metro Medellin, some have found that the process of transferring relatively large amounts of investment funds from the U.S. or other countries can be frustratingly complex, time-consuming – and even costly.

About Medellin Herald

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.

Medellin Herald welcomes your editorial contributions, comments and story-idea suggestions. Send us a message using the "contact" section.

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