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Economic and political overview

Economic Overview

Thanks to its market size, the extent of its natural resources (coffee, emeralds, oil and coal, among others) and a historical reputation as an exemplary debtor, Colombia has experienced stable and solid growth for most of the past two decades. The country’s macroeconomic stability is supported by a strong institutional framework, including a rules-based fiscal system, flexible exchange rate, and inflation targeting. However, economic growth has slowed, with low productivity contributing little to GDP growth. Despite various trade agreements, the country has struggled to diversify exports. Ongoing infrastructure issues, weak education outcomes, and institutional challenges limit Colombia's economic potential. GDP growth was estimated at 1.7% in 2024. While activity gradually recovered, key sectors like construction and manufacturing remained weak, and the mining sector continued to decline. GDP growth is projected at 2.5% in 2025 (IMF), with the economy recovering and nearing its potential growth rate by 2026. Private consumption, strong export growth, moderate import increases, and rising private investment are expected to drive the recovery, as inflation and interest rates decline.

The central government fiscal balance for 2024 was 6.7% of GDP, driven by revenue shortfalls and the failure to implement offsetting spending cuts. Consequently, general government debt to GDP rose to an estimated 58%, up from 53% in 2023 (Fitch Ratings). Due to revenue uncertainty and a weaker-than-expected 2025 outlook, Fitch raised its central government deficit forecasts for 2025 and 2026 to 6.2% and 5.8% of GDP, respectively. Therefore, the consolidated general government debt is expected to rise, reaching 62% of GDP by 2026, so as the interest/revenue ratio, seen at 15.7% in 2025 up from 14.9% in 2024. According to official governmental figures, inflation stood at 5.2% in 2024 and should continue declining to reach the upper band of the central bank's 3% (+/- 1pp) target by end-2025. The current account deficit is expected to widen slightly in 2025 to 2.1% of GDP, up from 1.8% in 2024. Additionally, the central bank has increased reserves to USD 61.9 billion by the end of 2024 to strengthen its external liquidity position.

As per the latest World Bank projections, 31.7% of the population was living below the poverty line as of 2024 (USD 6.85/day 2017 PPP). While inflation has declined, higher prices limit improvements in real incomes and food security. Climate shocks may also impact households, especially in regions like the Caribe and Pacífico. Investing in access to quality education is crucial. The unemployment rate stood at 9.1% at the end of December 2024, the lowest level since 2017. It should be noted, though, that more than half of the Colombian population continues to work in the informal sector. Overall, inequalities are strong throughout the country: Colombia has a Gini coefficient of 54.8, one of the highest in Latin America.

 
Main Indicators 2024 (E)2025 (E)2026 (E)2027 (E)2028 (E)
GDP (billions USD) 418.54427.77445.65466.15488.08
GDP (Constant Prices, Annual % Change) 1.72.42.62.82.8
GDP per Capita (USD) 7,9438,0548,3348,6639,019
General Government Balance (in % of GDP) -4.9-4.4-3.1-2.8-2.7
General Government Gross Debt (in % of GDP) 61.359.759.959.959.8
Inflation Rate (%) 6.64.73.13.03.0
Unemployment Rate (% of the Labour Force) 10.210.09.89.69.5
Current Account (billions USD) -7.41-9.65-10.83-13.23-15.10
Current Account (in % of GDP) -1.8-2.3-2.4-2.8-3.1

Source: IMF – World Economic Outlook Database , Latest data available

Country Risk

See the country risk analysis provided by La Coface.

 

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Main Sectors of Industry

Natural resources are abundant in Colombia. The country has the largest coal reserves in Latin America, and has the second largest hydroelectric potential in the continent, after Brazil. Colombia also has significant amounts of nickel, gold, silver, platinum, and emeralds, as well as large petroleum and natural gas reserves. Due to the climate and the topography of the country, agriculture is extensive and very diversified. Colombia's main crops are coffee, bananas, cut flowers, sugarcane, livestock, rice and corn. However, the share of agriculture in GDP has been falling consistently for over 50 years, as both industry and services have expanded, and it currently represents 8.7% of the GDP. Still, agriculture remains an important source of employment in the country, as it employs 14.4% of the workforce. As reported by the National Administrative Department of Statistics (DANE), in 2024, agricultural, livestock, fishing and forestry activities expanded by 8.1%, contributing 47% to national growth. Colombia's coffee sector grew by 22.5%, reinforcing its status as the country’s flagship product. Livestock expanded by 5.6% annually, accelerating to 6.6% in Q4. Agricultural support services rose by 8.3%, driven by tech and infrastructure improvements.

Colombia is the most industrially diverse country of the Andean Community, with four major industrial centres: Bogota, Medellin, Cali, and Barranquilla. Most industries in the country are driven by agriculture and commodities, with the main industries being textile, chemical products, metallurgy, cement, cardboard containers, plastic resins and beverages. The sector represents 24.6% of the GDP and employs 20% of the workforce, with manufacturing alone representing 11% of GDP, led by the chemical products sub-sector. In 2024, industrial production fell by 1.7% compared to 2023, according to DANE data.

The services sector’s importance has increased in recent years, becoming the backbone of the Colombian economy as it represents 56.9% of the GDP and employs 65.6% of the workforce. Tourism is one of the most important components of the service sector and has been particularly buoyant over the past few years, especially in Bogota, Medellin, Cartagena, Cali, and Barranquilla. Colombia saw a record number of tourists visiting the country in 2024, with around 6.7 million non-residents reported, marking an 8.5% increase y.-o-y (Ministry of Commerce, Industry and Tourism). The BPO sub-sector is one of the most dynamic with a 3.5% contribution to the national GDP. Finally, Colombia's banking sector is also pivotal to the country's economic development, featuring a blend of national and international banks.

 
Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 14.4 20.0 65.6
Value Added (in % of GDP) 9.3 23.1 58.1
Value Added (Annual % Change) 8.0 -1.4 2.0

Source: World Bank - Latest available data.

 
Monetary Indicators 20202021202220232024
Colombian Peso (COP) - Average Annual Exchange Rate For 1 USD 3,693.283,744.244,256.194,325.964,074.43

Source: World Bank - Latest available data.

 

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Foreign Trade

Colombia's foreign trade represents around 40% of the country’s GDP, according to the World Bank’s latest figures. Colombia mainly exports crude petroleum oils (25.4%), coal and solid fuels (16.2%), gold (6.8%), petroleum oils (5.9%), and coffee (5.9%); whereas the country's main imports include petroleum oils (8.2%), motor cars (4.4%), telephone sets (3.7%), medicaments (3.6%), and powered aircraft (3.5% - data Comtrade 2023)

According to data from Comtrade, in 2023, the main export partners were the United States (28.4%), Panama (9.4%), China (5.0%), India (4.8%), and the Netherlands (4.1%); with imports coming chiefly from the United States (25.8%), China (21.6%), Brazil (6.4%), Mexico (4.9%), and Germany (3.7%). Colombia has signed trade agreements with the ANC countries (Andean Community of Nations), the MERCOSUR countries, the Central American and Caribbean countries and the European Union. Along with Mexico, Chile and Peru, Colombia founded the Pacific Alliance in 2012, designed to boost trade relations with Asian emerging markets. The country is also part of numerous free trade agreements with Chile, Guatemala, Honduras, El Salvador, Canada, Mexico, Switzerland, Norway, Iceland, Liechtenstein and the United States. The free-trade agreement with the United States, which came into force in May 2012, has had a particularly large impact on the Colombian economy, given that the United States is the country's biggest trade partner.

In 2023, the country’s goods exports decreased by 13% to USD 49.5 billion, with imports following a slower pace (-18.8% y-o-y) to USD 62.8 billion. As per services, exports stood at USD 15.2 billion against USD 16.6 billion in imports (data WTO). The overall trade deficit was estimated at 4.8% of the country’s GDP, from 7.6% one year earlier (World Bank). According to data from DANA, in 2024, exports totalled USD 49.5 billion FOB, down slightly by 0.44% y-o-y. Non-traditional exports increased to 47.4% of the total, up 4.5 percentage points from 2023. The share of fuel and extractive products dropped from 52.5% to 47.2%, while agriculture and food exports rose to 23.2%, and manufacturing reached 21.3%. Imports amounted to USD 64.1 billion CIF, growing by 2.1% y-o-y.

 
Foreign Trade Values 20202021202220232024
Imports of Goods (million USD) 43,48961,10177,41362,79764,105
Exports of Goods (million USD) 31,00840,28756,99949,54549,564
Imports of Services (million USD) 10,04214,07917,84216,86218,224
Exports of Services (million USD) 5,7037,98513,85415,79517,542

Source: World Trade Organisation (WTO) ; Latest available data

Foreign Trade Indicators 20202021202220232024
Foreign Trade (in % of GDP) 34.140.148.340.437.0
Trade Balance (million USD) -8,870-13,984-12,178-6,808-9,156
Trade Balance (Including Service) (million USD) -13,105-20,001-16,068-7,766-9,551
Imports of Goods and Services (Annual % Change) -20.126.724.0-9.94.4
Exports of Goods and Services (Annual % Change) -22.514.612.53.12.5
Imports of Goods and Services (in % of GDP) 20.523.927.922.620.9
Exports of Goods and Services (in % of GDP) 13.516.220.417.816.1

Source: World Bank ; Latest available data

Foreign Trade Forecasts 20252026 (e)2027 (e)2028 (e)2029 (e)
Volume of exports of goods and services (Annual % change) 3.22.22.72.01.6
Volume of imports of goods and services (Annual % change) 4.24.74.24.04.0

Source: IMF, World Economic Outlook ; Latest available data

Note: (e) Estimated Data

 
International Economic Cooperation
Colombia has signed many international trade agreements, including:

- Latin American Association of Integration - ALADI
- Andean Community - CAN -Colombia, Equator, Peru, Bolivia
- CAN - Mercosur
- Central American and the Caribbeans
- FTA - Free Trade Agreement Colombia and Chile
- FTA Colombia, El Salvador, Guatemala and Honduras
- FTA Colombia, Peru and Canada
- FTA G2- Group of Two - Colombia and Mexico
- FTA Colombia and Peru - EFTA
- FTA Colombia and United States
- Trade Union CAN - UE

Colombia is part of the Pacific Alliance.

For more information consult this link.

 

Main Partner Countries

Main Customers
(% of Exports)		 2023
United States 28.4%
Panama 9.4%
China 5.0%
India 4.8%
Netherlands 4.1%
See More Countries 48.4%
Main Suppliers
(% of Imports)		 2023
United States 25.8%
China 21.6%
Brazil 6.4%
Mexico 4.9%
Germany 3.7%
See More Countries 37.5%

Source: Comtrade, Latest Available Data

 

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Political Outline

Current Political Leaders
President: Gustavo Francisco PETRO Urrego (since 7 August 2022)
Next Election Dates
Presidential: 31 May 2026
Congress: March 2026
Main Political Parties
About 60 political parties are formally recognised in Colombia, but most are not represented in the Chamber of Deputies. The main political parties in Colombia are:

- Social Party of National Unity (UN): centre-right, social liberalism, third way politics
- Democratic Centre (CD): centre-right, social conservatism, economic liberalism
- Conservative Party (PC): centre-right, social conservatism, economic liberalism, Christian democracy
- Colombian Liberal Party (PLC): centre-left, social liberalism, social democracy
- Radical Change Party (CR): centre-right, conservative liberalism
- Alternative Democratic Pole (PDA): centre-left, protectionism, social democracy, democratic socialism
- Independent Movement of Absolute Renovation (MIRA): centre-right to right, conservative liberalism, social conservatism, Christian democracy
- Green Alliance: centre-left, progressivism, pacifism, green politics, green liberalism
- Independent Movement of Absolute Renovation (MIRA): centre-right, communitarianism, social conservatism, Christian democracy

Executive Power
The President is both the Head of State and the Head of Government and holds executive power. The President and Vice President are elected by universal suffrage for a four-year term. They cannot be re-elected for a consecutive term but may run again after sitting out at least one term.
Legislative Power
The Colombian legislature is bicameral. The parliament, called 'Congress', consists of the Senate (upper house) and the Chamber of Deputies (lower chamber). The 108 members of the Senate and the 188 members of the Chamber of Deputies are elected for a period of four years.
 

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