The economy of Colombia is the fourth largest in Latin America as measured by gross domestic product. Colombia has experienced a historic economic boom over the last decade. Throughout most of the 20th century, Colombia was Latin America’s 4th and 3rd largest economy when measured by nominal GDP, real GDP, GDP (PPP), and real GDP at chained PPPs. Between 2012 and 2014, it became the 3rd largest in Latin America by nominal GDP.
As of 2018, the GDP (PPP) per capita has increased to over US$14,000, and the actual gross domestic product at chained PPPs increased from US$250 billion in 1990 to nearly US$800 billion. Poverty levels were as high as 65% in 1990 but decreased to under 30% by 2014 and 27% by 2018. They had decreased by an average of 1.35% per year since 1990.
Petroleum is Colombia’s main export, representing over 45% of Colombia’s exports. Manufacturing represents nearly 12% of Colombia’s exports and grows at around 10% yearly. Colombia has the fastest-growing information technology industry worldwide and the longest fibre optic network in Latin America. Colombia also has one of the largest shipbuilding industries in the world outside Asia. Modern industries like shipbuilding, electronics, automobile, tourism, construction, and mining, grew dramatically during the 2000s and 2010s.
However, most of Colombia’s exports are still commodity-based. Colombia is Latin America’s second-largest producer of domestically made electronics and appliances, following Mexico. Colombia had the fastest-growing major economy in the western world in 2014, behind only China worldwide. Since the early 2010s, the Colombian government has shown interest in exporting modern Colombian pop culture to the world (which includes video games, music, films, television shows, fashion, cosmetics, and food) to diversify the economy and entirely change the image of Colombia. This has inspired a national campaign similar to the Colombian Wave.
The number of tourists in Colombia grows by over 12% every year. Colombia is projected to have over 15 million tourists by 2023.
Small and Medium-Sized Enterprises (SMEs) represent an essential part of the Colombian economy, although they are not well documented in official statistics. In particular, there is insufficient periodic data on their characteristics, evolution, or overall contribution to the economy – in most cases, SMEs tend to be bundled with micro-enterprises in official statistics.
The actual size of the market is understated due to informality. Lack of access to finance has been cited as an important problem in recent surveys. However, there are significant differences in perceptions as to the size and causes of the financing gap. While there is strong evidence to support its existence following the 1999 crisis, the significant growth of this market in recent years raises some questions as to whether such perceptions remain valid.
One of the lessons of the last few years is that banks will expand SME lending on their own accord – despite the presence of essential constraints – when they perceive the attractiveness of this market and have begun to saturate easier (in terms of business model) market segments such as corporate and consumer lending. However, to ensure the sustainable growth of this market, continued solid macroeconomic performance and a stable and consistent policy framework in the financial sector have been identified as important considerations.