Colombia

Colombia is a country in northwestern South America, shaped by tropical forests, the Andes Mountains, and numerous coffee plantations. Colombia is the fourth-largest country in South America and one of the most densely populated countries on the continent.

General information

The official name of the country is the Republic of Colombia. The state occupies an area of ​​1,138,910 km2 (27th in the world). The population is about 52,628,104 people (as of 2024).

Mestizos make up 58% of the total population of Colombia. In addition to them, the country is also inhabited by representatives of the Caucasian race - 20%, mulattoes (descendants of blacks and Europeans) - 14%, blacks - 4%, descendants of mixed marriages of Indians and blacks - 3%, Indians - 1%.

The majority of Colombian citizens profess Christianity - about 95.7%. Traditional religions have also been preserved in the country; Among the migrants are Muslims, Hindus, and Buddhists.

The official language of the country is Spanish, which is spoken by almost all residents of the country (99.2%), with the exception of some Indian tribes. In total, there are 65 surviving Indian languages ​​in Colombia, but their number is decreasing every year. English is the official language in the department of San Andrés y Providencia. The languages ​​and dialects of the ethnic groups of Indians are also official in their territory.

The currency of the country is the Colombian peso.

Bogotá (Santa Fe de Bogotá) is the capital and largest city of Colombia. It is the largest economic center of the country and one of the most important economic centers of South America. The total GDP of the capital is about 86 billion US dollars, which is a quarter of the GDP of all of Colombia. The headquarters of most Colombian companies are located in Bogotá. The city is also the most important industrial and financial center of Colombia, where the headquarters of most of Colombia's private banks, the Bank of the Republic and others are located.

Medellín is the second most important city in Colombia. It is called the industrial capital of the country. The city has a modern, highly developed diversified economy, the basis of which is:

• ferrous metallurgy
• textile industry
• production of building materials
• food industry
• petrochemicals
• banking
• service sector

The city is home to the headquarters of the largest financial and industrial group in Colombia, Grupo Empresarial Antioqueño, which creates 5.5% of the country's GDP, and in general, Medellin creates 11% of Colombia's GDP, being the second most important economic center of the country after the capital. Medellin has become a popular tourist destination (the third in the country after Cartagena and Bogota). Flower growing and export play an important role.

Barranquilla is an industrial, port city and municipality located in northern Colombia. It is the largest port and industrial city in the Colombian Caribbean. Despite the fact that Barranquilla is located 15 km from the sea and stands on a river, this city has become a major port relatively recently. Seabed regulation measures with the simultaneous construction of the Barranquilla harbor contributed to the transformation of this city into the largest port in Colombia. From here, Colombian coffee is exported by sea to all countries of the world. In addition to coffee, important export products include textiles, cement, and chemical products.

Cartagena de Indias or simply Cartagena is the fifth largest city in Colombia, a major port on the Caribbean coast. Cartagena has a modern diversified economy, being the third most important economic center of the country. The main industries are:

• Tourism (the main tourist destination of Colombia)
• Industry (primarily petrochemicals, oil refining, production of building materials)
• Services and trade
• Logistics (the main port of Colombia)
• Construction

There are several free economic zones with preferential taxation and customs administration in the city and its environs.

In territorial and administrative terms, Colombia is divided into 32 departments and the capital district of Bogotá. They are in turn subdivided into municipalities (1122), some of which fall under the category of district. In addition, there are so-called provinces, this word unites such similar entities as districts, regions and subregions.

History, geography, culture, mentality

Before the arrival of the first European colonizers in South America, the lands that are now part of the Republic of Colombia were inhabited by the Muisca Indians, or Chibcha. With the arrival of Europeans in South America, the world of the Muisca ceased to exist. The Spaniards, who began to develop new territories, founded the first European city in Colombia in 1525 and named it Santa Marta.

Just 11 years later, the colonizers decided to develop the lands of the recently discovered continent and set off on a campaign up the river, which they called Magdalena. The troops led by Gonzalo de Quesada went deep into the Indian territory and soon subdued the local population. In 1538, de Quesada founded a new city on the site of a former Muisca fortress called Bacata, which was named Santa Fe de Bogotá. In parallel with de Quesada's troops, new lands were being developed by the Spaniards under the command of Sebastian de Belalcazar, who were moving to the southern part of the Andes along the Cauca River. He became the founder of such cities in the Indian territory as Cali and Popayán. In gratitude for their discoveries and achievements, the monarch of Spain appointed de Quesada governor of the newly conquered lands with the center in the city of Santa Fe de Bogotá, which the conquistador called New Granada. Belalcazar headed the territories located in the valley of the Cauca River.

In 1718, the Spanish Crown announced the entry of New Granada, which included, in addition to Colombia, Ecuador, Venezuela and Panama, as a viceroyalty into the Empire. In 1815, after the return of the legitimate monarch to power in Spain, the Crown attempted to regain control over New Granada. Military detachments began to arrive here to restore order and establish the power of the king.

Four years later, Simon Bolivar defeated the Spanish troops at Boyaca, and New Granada became known as Greater Colombia. Bolivar became the first president of the new state. In 1886, the country was renamed the Republic of Colombia.

The beginning of the last century began with another split in the country. The reason for this was the refusal of the Colombian government in 1903 to grant permission to the United States to build a canal in Panama that would connect the Atlantic and Pacific Oceans.

Oil deposits were explored and discovered on Colombian territory. Gold mining, tobacco and coffee exports became important sectors.

After the conservative Laureano Castro came to power in 1949, a dictatorship was established in the country. A guerrilla movement of dissenters arose, and an internecine war lasted for 10 years. By the 1960s, Colombia had already begun a period of recovery, and its economy quickly took a leading position in all of South America.

Colombia borders Brazil and Venezuela to the east, Ecuador and Peru to the south, and Panama to the west. It shares sea borders with Costa Rica, Nicaragua, Honduras, Jamaica, Haiti, and the Dominican Republic. It is washed by the Caribbean Sea to the north and the Pacific Ocean to the west. In the west of the country, the Andes stretch from north to south, dissected by river valleys. In the east, there is a plateau crossed by tributaries of the Amazon.

According to the Constitution of Colombia, the foundation of the nation is culture "in its various manifestations." The fusion of European, Indian, and African-American cultural traditions is reflected in music, literature, and other forms of art. Numerous musical and dance styles are widespread in the country: cumbia, vallenato (north of the country), curulao (west), salsa, joropo (eastern plains). Festivals and carnivals are popular, of which the carnival in Barranquilla and the "Carnival of Blacks and Whites" in Pasto are included in the UNESCO list of intangible cultural heritage of humanity.

Since Colombia is a historically multinational country, the local population is characterized by extraordinary tolerance, friendliness, and the ability to absorb different cultures. It is a mixture of many Indian (and still existing), European (primarily Spanish) and African traditions and customs.

Many cultural traditions of the pre-Columbian era are still preserved in the country. Indian influence is still noticeable in works of folk art, sculpture, fabrics, music and dance.

The surviving temples, statues and ceramics testify to the richness of the Indian culture, the collection of gold items made by ancient masters of pre-Columbian America amazes with its skill and elegance.

The art of the colonial period is represented mainly by church architecture, religious paintings and statues of saints. The Nobel Prize winner Gabriel García Márquez brought worldwide fame to Colombian literature.

Power

Colombia is a presidential republic with a unitary form of government. The current Constitution of the country was adopted on July 5, 1991.

The head of state and government is the president, elected for four years.

The parliament is the Congress of the Republic of Colombia. It consists of the Senate (108 seats) and the House of Representatives (188 seats), the leadership of which is re-elected annually on July 20.

Economy

Colombia has one of the most dynamically developing economies in the region. This agro-industrial country has large reserves of minerals, in particular, oil, gas, coal, iron-nickel and copper ores, gold and platinum. Colombia accounts for about 90% of the world's emerald production. The leading branches of the agricultural industry: production of coffee, sugar, tropical fruits, flowers, tobacco, rice, corn.

Colombia supplies oil, coal, gas, ferronickel, emeralds, clothing, fabrics, coffee, bananas, flowers to foreign markets. Colombians import industrial equipment, mineral fertilizers, household goods.

The mountainous nature of most of Colombia, along with the accompanying climatic changes in various vertical zones, allows for the cultivation of an unusually wide range of both tropical and temperate crops, from bananas and sugar cane to wheat, barley and potatoes. Coffee has long been the backbone of Colombia's economy, commanding high prices on the world market and accounting for about half of all legal exports. However, the coffee trade has always been sensitive to price swings.

Domestic cotton supplies Colombia's large textile industry. Other minor crops include tobacco, sesame, African oil palms, cocoa, peanuts (groundnuts), grapes, soybeans, and citrus.

During the colonial period, the economy was based almost entirely on gold mining, manufacturing for export, and domestic consumption.

Private enterprise dominates the economy, with direct government involvement limited to industries such as railroads, oil, and telecommunications. The government promotes economic stability and encourages private enterprise through indirect measures such as a favorable tax system and credit for new industries.

Colombia has an abundance of non-renewable resources, including gold, coal, and oil. Its renewable resources include fertile agricultural land and rivers that are increasingly being used to generate hydroelectric power.

Gold deposits, particularly in the west-central part of the country, have been important since colonial times. In some areas, gold-bearing gravels also contain silver and platinum.

The coal deposits of La Guajira are the largest in northern South America. Ferronickel reserves are located along the San Jorge River, and there is a large copper deposit in western Antioquia. The Cordillera Oriental has long been an important source of rock salt, marble, limestone, and especially the highly prized Colombian emerald (the country is the world's largest producer of emeralds).

Oil deposits have long been exploited in the Magdalena and Catatumbo river valleys, and major new deposits were discovered in the Llanos and Amazon in the late 20th century.

Colombia has more hydroelectric potential than any other country on the continent, and hydroelectric power plants generate about three-quarters of the country's electricity; however, severe droughts (especially in 1992–93) have occasionally interrupted service, and additional thermal power plants have been built in many areas. Colombia has the fourth-largest economy in Latin America, and is part of the CIVETS and a member of the UN, WTO, OAS, Pacific Alliance, and other international organizations. The country participates in more than 15 international trade agreements and alliances, including Mercosur. Colombia also has a strategic partnership with the United States.

Business climate

Colombia’s business climate has improved significantly in recent years, thanks to strong economic growth, regulatory reforms, and openness to foreign investment.

Colombia has a comprehensive legal framework for business and foreign direct investment, which includes binding provisions arising from its membership in the Andean Community of Nations and the WTO, as well as other free trade agreements and bilateral investment treaties.

Colombia’s economic liberalization reforms in the early 1990s created a strong framework for foreign direct investment (FDI): it provided national treatment for foreign investors, eliminated controls on the remittance of profits and capital, and allowed foreign investment in most sectors.

Colombia imposes the same investment restrictions on foreign investors as it does on domestic investors. In general, foreign investors can participate in the privatization of state-owned enterprises without restrictions. All FDI related to the establishment of a commercial presence in Colombia requires registration with the Superintendence of Corporations (Supersociedades) and the local Chamber of Commerce. Under equal conditions during tender processes, Law 80 of 1993 provides that national bids shall have priority over foreign bids. Assuming equal conditions among foreign bidders, preference shall be given to those with major Colombian national labor resources, significant national capital and/or better conditions for facilitating technology transfer.

Investment climate

Colombia has reached a historic peak in foreign direct investment (FDI), recording US$17.4 billion in 2023. This growth underlines the country’s attractiveness for sustainable and diversified investment, especially in key sectors such as tourism, infrastructure and renewable energy.

Investment highlights:

1. The second investment destination in Latin America and the Caribbean.

Colombia has established itself as the second most attractive location for investment projects in the region, with US$1.03 billion invested from 2018 to 2023, creating 4,714 jobs. This positioning reflects the sustained confidence of international investors and the growing importance of Colombia in the Latin American market.

2. Significant recovery of international tourism.

Since 2019, Colombia has seen a 35% increase in international arrivals, reaching a historical record in 2023. This recovery is driven by growth in nature and cultural tourism, with the United States, Mexico and Spain as key markets. Colombia is becoming an attractive destination for a wide range of traveler profiles.

3. Advances in connectivity and infrastructure.

Colombia has invested in improving connectivity and accessibility through the Tourism Master Plan (PMTI). Recent airport projects have increased capacity for arrivals, while investments in 363 km of roads, 1,518 km of railways and 87.5 km of metro lines contribute to efficient intermodal connectivity, significantly improving access to strategic tourist destinations.

4. UNESCO Recognition and Biodiversity.

Colombia is the second most biodiverse country in the world, boasting 17 UNESCO-recognized cultural heritage sites. In addition, four villages have been included in the prestigious list of “Best Tourism Villages” by UN Tourism. These international distinctions enhance the country’s natural and cultural tourism capabilities, positioning Colombia as a unique destination committed to preserving culture and the environment.

5. Leadership in Green Investment.

Colombia has the third-largest sustainable energy capacity in Latin America, making it ideal for green tourism projects. It is also the fourth most attractive emerging market for renewable energy investment and ranks fourth in Latin America for LEED-certified projects, promoting green building practices in the tourism sector.

In addition, according to the World Economic Forum’s Energy Transition Index, Colombia is the third-largest economy in the Americas capable of delivering self-sufficient, affordable, and high-quality energy in a sustainable manner. Colombia is also positioned as a key player in the development of sustainable buildings. As of March 2023, the country was the fourth-largest market in Latin America for Leadership in Energy and Environmental Design (LEED)-certified projects, with 503 projects certified and in the certification process.

6. Attractive incentives for tourism investment.

Colombia offers attractive fiscal incentives for tourism projects, including VAT exemptions, special income tax rates of 20% in free zones, and a reduced income tax rate of 15% for new developments for ten years. These incentives apply to ecotourism, agritourism, substantial renovations, and research and innovation projects, highlighting the country's commitment to attracting sustainable and high-return tourism investment.

Business and investment support structures

Colombia is actively developing its business and investment support infrastructure to attract foreign capital and stimulate economic growth. Here are the main structures and programs that support entrepreneurs and investors:

1. Government agencies.

ProColombia. The main organization dedicated to promoting foreign investment, tourism and exports. It provides:

• Market analysis.
• Investment advice.
• Assistance in finding partners.

MinCIT (Ministry of Trade, Industry and Tourism). Responsible for developing policies that promote economic development and international trade.

Banco de la República (Central Bank of Colombia). Manages monetary policy and provides financial services, including data for investors.

2. Financial support.

Bancóldex. National Bank for Business and Foreign Trade. Provides loans to small and medium-sized businesses on preferential terms.

Venture capital funds. Colombia supports investment through venture capital funds such as Grupo Bolívar and ColCapital, which focus on innovative startups.

3. Programs and Initiatives.

Ruta N (in Medellin). This is an innovation hub that supports tech startups and investors through training, accelerators and grant programs.

Innpulsa Colombia. A national initiative to develop entrepreneurship aimed at supporting innovative companies and startups.

4. Free Economic Zones.

Colombia provides advantages for businesses through Free Trade Zones (Zonas Francas), including tax incentives and simplified bureaucratic procedures.

5. Private structures and accelerators.

Endeavor Colombia. Works with entrepreneurs, providing mentoring, funding and connections.

Startupbootcamp FinTech. An international accelerator active in Colombia.

These structures and programs make Colombia a competitive place for business, especially in the fields of technology, agriculture and manufacturing.