April 2010
AGENDA


¿Where are we coming from?

       ¿What are we doing?

  ¿Where are we going next?
OUTSTANDING PERFORMANCE OF THE
      COLOMBIAN ECONOMY
COLOMBIA AND WORLD GDP GROWTH (%)
                    2000 – 2010
 8%                                                     ...
FDI IN COLOMBIA IS THREE TIMES GREATER THAN
               SEVEN YEARS AGO
                                               ...
EXPORTS TRIPLED

                                              Exports, 2000 – 2010
    40.000                            ...
INTERNATIONAL VISITORS IN COLOMBIA DOUBLED

                                               Tourism, 2000 – 2009
 2.000    ...
DURING 2009, COLOMBIA WAS ONE OF THE BEST
     ECONOMIC PERFORMERS IN THE REGION
                                         ...
VIOLENCE LEVELS ARE DECREASING
         SURPRISINGLY
HOMICIDE RATE PER 100 THOUSAND INHABITANTS
            REDUCED TO A HALF
                                          Homicid...
BOGOTÁ, SAFER THAN
        WASHINGTON, ATLANTA and MIAMI
                                          Homicides per 100,000 I...
THE BEST THING ABOUT COLOMBIA IS ITS
           HUMAN CAPITAL
WE HAVE THE FASTEST GROWING LABOR FORCE IN LATIN AMERICA
                             Labor Force Growth, 2007-2008       ...
ACCORDING TO THE IMD, COLOMBIA HAS THE SECOND BEST
                   ENGINEERS IN LATIN AMERICA
                         ...
ACCORDING TO THE IMD, COLOMBIA'S LABOR
REGULATIONS HINDER BUSINESS ACTIVITIES IN LATIN
             AMERICA THE LEAST
    ...
MAJOR ADVANCES IN EDUCATION
COLOMBIA OFFERS A QUALITY BASIC AND SECONDARY EDUCATION AND
                   ITS COVERAGE IS ON THE RISE
               ...
THE NUMBER OF GRADUATES FROM POST-GRADUATE
 PROGRAMS ROSE 72%, VOCATIONAL TECHNOLOGY
   PROGRAMS ROSE 44% AND UNDERGRADUAT...
OUR CONNECTING FLIGHTS ARE CONSTANTLY
             ON THE RISE
IMPROVING CONNECTIVITY: MORE AIR TRAVEL
                AGREEMENTS
                                                       ...
A COUNTRY THAT PROTECTS THE
      ENVIRONMENT
COLOMBIA IS THE NINTH COUNTRY IN THE WORLD AND THE FIRST IN
       THE REGION IN PROTECTING THE ENVIRONMENT
              ...
OUR COUNTRY HAS THE SECOND LOWEST CO2 EMISSIONS
                      Carbon Dioxide Emissions
                           ...
¿Where are we coming from?

       ¿What are we doing?

  ¿Where are we going next?
FROM PREFERENTIAL ACCESS TO 233 MILLION
 CONSUMERS IN 2002 TO ACCESS TO 1.46 BILLION
            CONSUMERS IN 2010
2002


...
IN 2010, COLOMBIA WILL BE NEGOTIATING 19 INTERNATIONAL
 INVESTMENT AGREEMENTS (IIA) WITH 39 COUNTRIES AND 21
  DOUBLE TAXA...
COLOMBIA, AN OPEN COUNTRY TO THE WORLD

 2010




Note: Highlighted countries are those in which Colombia has already an a...
COLOMBIA: THE MOST “BUSINESS FRIENDLY”
 COUNTRY IN LATIN AMERICA, ACCORDING TO THE
             WORLD BANK (2010)
        ...
ACCORDING TO THE WORLD BANK ON “DOING
BUSINESS, 2010" COLOMBIA IS THE FIRST COUNTRY
IN LATIN AMERICA THAT BEST PROTECTS IN...
THE MOST COMPETITIVE FTZ’S IN LATIN AMERICA: 15%
INCOME TAX AND ALLOWS SALES TO THE LOCAL MARKET

         15% income tax....
76 FREE TRADE ZONES
                                                                                 Free Trade Zone Appro...
PERMANENT FREE TRADE ZONES (PFTZ)
Several firms installed in a FTZ already established

Requirements for industrial firms ...
SINGLE-COMPANY FREE TRADE ZONES (SCFTZ)
A single firm can get all FTZ advantages by installing itself in
                 ...
SINGLE-COMPANY FREE TRADE ZONES (SCFTZ)
A single firm can get all FTZ advantages by installing
            itself in any p...
NEW SCFTZ REGIME IN FIVE PROVINCES OF
               SOUTHERN COLOMBIA

                          Characteristics
        ...
COLOMBIA OFFERS LEGAL STABILITY CONTRACTS TO
       GUARANTEE INVESTMENT PROJECTS

                 Investments over US$1....
OTHER INCENTIVES BY SECTOR: INCOME TAX
      EXEMPTION FOR UP TO 20 YEARS
                        • Exemption for 30 years...
¿Where are we coming from?

       ¿What are we doing?

  ¿Where are we going next?
POTENTIAL WORLD CLASS SECTORS
PRODUCTIVE TRANSFORMATION PROGRAM
   "GOVERNMENT - PRIVATE SECTOR"
 Encourage and improve pr...
BPO&O
Competitive
                       • Call center agent cost: USD 441/month
  Operational Cost


                       • 2...
IT SERVICE &
SOFTWARE
Competitive        • The lowest labor cost in LATAM: up to 284% for
  Operational Cost       System Engineering careers.

...
HEALTH TOURISM
• Eye laser surgery Innovation
  Innovation      • Pioneer Program in reproduction immunology
                  • 1st pace...
COSMETICS AND
PERSONAL CARE
PRODUCTS
World Leader
                  • The second largest country in number of species of plants
in Biodiversity

   Human      ...
BIO-FUELS
•Single enterprise Fee Trade Zone.
 Tax Incentives     • Income tax exemption on late yield crops during ten
             ...
FORESTRY
Land Availability   •17 M ha (42 M acres) suitable for timberland


    Diversity        • More than 10 forestry species w...
AUTOMOTIVE
Dynamic Industry        • Colombian exports of auto parts increased by 46% in (06-08)


  Excellent geo-
economic position...
Electric
Power
Energy       • Best energy infrastructure in Latam. (IMD)
                 • Third country in future energy supply in Lata...
TEXTILES, APPA
REL, FASHION
AND DESIGN
• Over 100 years of experience
Experience in     • Coltejer founded in 1907
textile market    • Tejicondor and Fabricato (...
INFRASTRUCTURE
PUBLIC INFRASTRUCTURE PROJECTS ACCOUNT FOR US$ 21
                     BILLION

                  • Projects to the constr...
GRAPHIC
COMMUNICATION
INDUSTRY
• Global production process consisting of pulp
                         production (U.S. $ 29,300 million), production of
...
CONCLUDING REMARKS




   In the last few years, Colombia has experienced a marked
                 improvement in its mac...
CONCLUDING REMARKS




  Colombia has achieved a solid structural growth, based on an
      increase in the investment rat...
CONCLUDING REMARKS




   The country has guaranteed its external funding for 2009
    trough multilateral institutions su...
CONCLUDING REMARKS




   Colombia is aggressively negotiating trade and investment
      agreements expanding its markets...
CONCLUDING REMARKS




  The Colombian Government is committed to generating the
       most favorable conditions for dome...
www.inviertaencolombia.com.co · www.colombiaespasion.com · www.mincomercio.gov.co
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Presentacion invierta en colombia abril 2010

  1. 1. April 2010
  2. 2. AGENDA ¿Where are we coming from? ¿What are we doing? ¿Where are we going next?
  3. 3. OUTSTANDING PERFORMANCE OF THE COLOMBIAN ECONOMY
  4. 4. COLOMBIA AND WORLD GDP GROWTH (%) 2000 – 2010 8% 7,5% 6,8% 7% 6% 5,7% 5% 4,6% 4,7% 4% 3,1% 3% 2,2% 2,5% 2,5% 2,5% 2% 1% 0,4% 0% -1% -2% -3% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009* 2010* Colombia World Source: DANE (National Accounts), DNP, EIU (Market Indicators & Forecasts) Note: * EIU forecast to the World Note: Last update March 25rd, 2010 4
  5. 5. FDI IN COLOMBIA IS THREE TIMES GREATER THAN SEVEN YEARS AGO FDI, 2000 – 2010 12.000 US$ Millones 10.600 10.252 10.000 8.500 7.201 8.000 6.000 4.000 2.134 2.000 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010* Variation 2008-2009: -32% *Forecast EIU. Source: Banco de la República
  6. 6. EXPORTS TRIPLED Exports, 2000 – 2010 40.000 US$ Millones 37.626 35.282 32.852 35.000 30.000 25.000 20.000 15.000 11.975 10.000 5.000 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010* *EIU Forecast Source: DANE (Departamento Nacional de Estadísticas) 6
  7. 7. INTERNATIONAL VISITORS IN COLOMBIA DOUBLED Tourism, 2000 – 2009 2.000 Thousand Visitors 1.700,5 1.600 1.451,0 1.200 661,1 800 400 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Note: Includes cruise Source: DAS (Departamento Administrativo de Seguridad) 7
  8. 8. DURING 2009, COLOMBIA WAS ONE OF THE BEST ECONOMIC PERFORMERS IN THE REGION Exports FDI -12,7% Colombia -10,0% Colombia -16,7% Peru -22,0% Chile -20,2% Chile -23,7% Mexico -20,6% Argentina -24,1% Brazil -21,2% Mexico -36,0% Peru -22,7% Brazil -51,6% Argentina* -35,9% Venezuela -74,0% Venezuela Tourism Colombia 10,7% Brasil 5,8% Perú 3,9% Source: Official sources of each country, World Tourism Organization and México** -6,7% LatinFocus Chile -11,3% Export: Variations in FOB between 2008 and 2009 FDI: Variation FDI flows between I Half 2008 and I Half 2009 Argentina** -13,1% Tourism: Variation number of foreign visitors between 2008 and 2009 Venezuela** -17,5% *Variation between I Quarter 2008 and I Quarter 2009 **Variation between January-August 2008 and Jan-August 2009 8
  9. 9. VIOLENCE LEVELS ARE DECREASING SURPRISINGLY
  10. 10. HOMICIDE RATE PER 100 THOUSAND INHABITANTS REDUCED TO A HALF Homicides per 100.000 Inhabitants, 2000-2009 75 62,7 65,8 65 55 44,6 45 35,4 33,0 35 25 15 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Source: Ministry of Defense 10
  11. 11. BOGOTÁ, SAFER THAN WASHINGTON, ATLANTA and MIAMI Homicides per 100,000 Inhabitants 2008 120 107 100 80 60 40 40 29 17 18 18 19 20 21 22 20 5 10 3 4 0 Source: Bogotá Chamber of Commerce, based on information issued by AméricaEconomía Intelligence and the Bogotá Metropolitan Police; FBI
  12. 12. THE BEST THING ABOUT COLOMBIA IS ITS HUMAN CAPITAL
  13. 13. WE HAVE THE FASTEST GROWING LABOR FORCE IN LATIN AMERICA Labor Force Growth, 2007-2008 World Country (Percentage Variation) Ranking Colombia 3,0% 5 Colombia Venezuela 2,7% 8 Venezuela Argentina 1,5% Chile 1,4% 25 Argentina Brazil 1,3% 27 Chile Peru 0,8% 29 Brazil Mexico 0,4% 38 Peru 48 Mexico 0,0% 0,5% 1,0% 1,5% 2,0% 2,5% 3,0% 3,5% WE HAVE THE SECOND MOST QUALIFIED LABOR AVAILABLE IN THE REGION Availability of Qualified Labor, 2009 World Chile 5,66 Country Ranking Colombia 5,49 29 Chile Argentina 5,04 32 Colombia Mexico 4,6 37 Argentina Brazil 4,58 45 Mexico Peru 3,92 46 Brazil Venezuela 2,67 55 Peru 0 1 2 3 4 5 6 57 Venezuela Rating Source: IMD World Competitiveness, 2009. Ranking among 57 countries.
  14. 14. ACCORDING TO THE IMD, COLOMBIA HAS THE SECOND BEST ENGINEERS IN LATIN AMERICA Qualified Engineers, 2009 World Country Chile Ranking 7,26 Colombia 5,97 7 Chile Argentina 5,81 30 Colombia Brazil 5,32 32 Argentina Mexico 5,04 41 Brazil Peru 4,99 43 Mexico Venezuela 4,92 44 Peru 48 Venezuela 0 1 2 3 4 5 6 7 8 COLOMBIA IS THE COUNTRY WITH THE BEST QUALITY EDUCATION IN SCIENCE AND MATHEMATICS IN THE REGION High Quality Education in Science and Mathematics in World Latin America, 2009 Country Ranking Colombia 3,56 39 Colombia Argentina 3,35 44 Argentina Venezuela 2,95 48 Venezuela Chile 2,91 49 Chile Brazil 2,71 Mexico 51 Brazil 2,58 Peru 2,23 53 Mexico 54 Peru 0 1 2 3 4 Rating Source: IMD World Competitiveness, 2009. Ranking among 57 countries. World Economic Forum, Executive Opinion Survey 2008, 2009
  15. 15. ACCORDING TO THE IMD, COLOMBIA'S LABOR REGULATIONS HINDER BUSINESS ACTIVITIES IN LATIN AMERICA THE LEAST Hindering of Business Activities by Labor Regulations in Latin America, 2009 World Country Ranking Colombia 4,27 31 Colombia Mexico 4 36 Mexico Chile 3,8 42 Chile Brazil 3,63 45 Brazil Peru 3,47 47 Peru Argentina 2,81 56 Argentina Venezuela 1,17 57 Venezuela 0 1 2 3 4 5 Rating Source: IMD World Competitiveness, 2009. Ranking among 57 countries.
  16. 16. MAJOR ADVANCES IN EDUCATION
  17. 17. COLOMBIA OFFERS A QUALITY BASIC AND SECONDARY EDUCATION AND ITS COVERAGE IS ON THE RISE Basic and Secondary Education Coverage, 2002-2008 11.500.000 92% 11.000.000 90% 88% 10.500.000 86% 10.000.000 84% 9.500.000 82% 9.000.000 80% 2002 2003 2004 2005 2006 2007 2008* Total Enrollment Coverage Rate OVER THE LAST 7 YEARS, THE COVERAGE OF HIGHER EDUCATION HAS RISEN 57%, WHILE THE NUMBER OF STUDENTS ENROLLED HAS INCREASED BY 44% Higher Education Coverage, 2002-2008 1.500.000 40,0% 1.200.000 30,0% 900.000 20,0% 600.000 10,0% 300.000 0,0% 2002 2003 2004 2005 2006 2007 2008 Students Enrolled Coverage Rate Note: Coverage indicates that the percentage of children that are supposed to be at a certain level are actually at that level. Basic and secondary education are primary and high school, while higher education is the university level. * Data forecasted based on the enrollment report to June 30, 2008. Preliminary data subject to modification Source: Ministry of Education
  18. 18. THE NUMBER OF GRADUATES FROM POST-GRADUATE PROGRAMS ROSE 72%, VOCATIONAL TECHNOLOGY PROGRAMS ROSE 44% AND UNDERGRADUATE PROGRAMS ROSE 9% Graduates Per Level of Education, 2002-2008 250 (in Thousands) 15,4 9,7 200 13,2 8,1 17,9 8,4 84,9 94,4 150 9,2 84,3 101,6 89,1 92,5 100 77,3 50 122,1 122,5 104,1 78,9 66,9 85,5 60,5 0 2.002 2.003 2.004 2.005 2.006 2.007 2.008 VO-TECH UNDERGRADUATE POTS-GRADUATE Source: Ministry of Education
  19. 19. OUR CONNECTING FLIGHTS ARE CONSTANTLY ON THE RISE
  20. 20. IMPROVING CONNECTIVITY: MORE AIR TRAVEL AGREEMENTS United Kingdom Portugal Spain France Belgium Holland Switzerland Luxemburg Germany Cuba Italy China Dominican Republic Dutch Antilles United States Arab Emirates French Antilles Mexico Singapore Aruba Costa Rica South Korea Panama Venezuela Surinam Ecuador Signed Agreements and Memorandums of Peru Understanding (31) Bolivia Brazil Agreement under Negotiation (1) Chile Argentina Since the year 2000, international flights to Uruguay Colombia have increased by 120%, totaling 5600 flights per month on average in 2008. Source: Ministry of Commerce, Industry and Tourism
  21. 21. A COUNTRY THAT PROTECTS THE ENVIRONMENT
  22. 22. COLOMBIA IS THE NINTH COUNTRY IN THE WORLD AND THE FIRST IN THE REGION IN PROTECTING THE ENVIRONMENT Environmental Performance Index, 2008 World Country Colombia 88,3 Ranking Chile 83,4 9 Colombia Brazil 82,7 29 Chile Argentina 81,8 35 Brazil Venezuela 80 38 Argentina Mexico 79,8 45 Venezuela Peru 78,1 47 Mexico 0 20 40 60 80 100 60 Peru Rating COLOMBIA HAS THE ENVIRONMENTAL LAWS THAT LEAST AFFECT COMPANY COMPETITIVENESS Hindering of Business Activities by Environmental Laws World Country Ranking Colombia 5,87 Mexico 5,77 31 Colombia Peru 5,63 34 Mexico Venezuela 5,50 42 Peru Argentina 5,15 43 Venezuela Chile 4,86 50 Argentina Brazil 4,78 53 Chile 0 1 2 3 4 5 6 54 Brazil Rating Source: Environmental Performance Index 2008, Yale University. IMD World Competitiveness, 2009, Ranking among 57 countries
  23. 23. OUR COUNTRY HAS THE SECOND LOWEST CO2 EMISSIONS Carbon Dioxide Emissions World (Metric Tons) Ranking Country Peru 27,9 Colombia 59,4 7 Peru Chile 59,8 21 Colombia Argentina 148,7 22 Chile Venezuela 149,2 31 Argentina Brazil 332,4 32 Venezuela Mexico 416,3 42 Brazil 47 Mexico 0 100 200 300 400 500 COLOMBIA'S ENTREPRENEURS STRIVE TOWARD SUSTAINABLE DEVELOPMENT World Country Ranking 23 Colombia 27 Chile 32 Brazil 46 Peru 47 Mexico 51 Venezuela 57 Argentina Rating Source: IMD World Competitiveness, 2009. Ranking among 57 countries.
  24. 24. ¿Where are we coming from? ¿What are we doing? ¿Where are we going next?
  25. 25. FROM PREFERENTIAL ACCESS TO 233 MILLION CONSUMERS IN 2002 TO ACCESS TO 1.46 BILLION CONSUMERS IN 2010 2002 2010 ACN 25
  26. 26. IN 2010, COLOMBIA WILL BE NEGOTIATING 19 INTERNATIONAL INVESTMENT AGREEMENTS (IIA) WITH 39 COUNTRIES AND 21 DOUBLE TAXATION AGREEMENTS (DTA) WITH 22 COUNTRIES 2010 IIA (13 Countries) DTA (16 Countries) In Force: Peru (2003), Spain (2007), Switzerland (2009). In Force: Spain (2008), Peru-Ecuador-Bolivia (2004) and Chile (2009). Signed: Peru (deepening), China (2008), India (2009), China, Belgium Signed: Switzerland (2007), Canada (2008) and Mexico (2009). and Luxembourg (2009) and U.K. (2009). In Negotiation: Germany, Netherlands, India, USA, Belgium, Czech In Negotiation: Germany, France, South Korea (not sign Republic, Korea, Japan, France and Venezuela yet), Kuwait, Japan.
  27. 27. COLOMBIA, AN OPEN COUNTRY TO THE WORLD 2010 Note: Highlighted countries are those in which Colombia has already an agreement in force, signed, under negotiation, or planned for the near future, concerning Free Trade, double taxation and Investment.
  28. 28. COLOMBIA: THE MOST “BUSINESS FRIENDLY” COUNTRY IN LATIN AMERICA, ACCORDING TO THE WORLD BANK (2010) Doing Business Ranking Variation, 2007-2010* World Country (Change in positions) Ranking (2010) Colombia 42 37 Colombia Peru 9 49 Chile Panama 4 Mexico 51 Mexico -8 Brazil -8 56 Peru Paraguay -12 77 Panama Venezuela -13 114 Uruguay Ecuador -15 Costa Rica -16 118 Argentina Argentina -17 121 Costa Rica Chile -21 124 Paraguay Uruguay -50 129 Brazil -60 -40 -20 0 20 40 60 138 Ecuador Source: Top Reformers Report, World Bank 177 Venezuela *Positive figures show improvements in business environment
  29. 29. ACCORDING TO THE WORLD BANK ON “DOING BUSINESS, 2010" COLOMBIA IS THE FIRST COUNTRY IN LATIN AMERICA THAT BEST PROTECTS INVESTORS Strength of Investor Protection, 2010 Colombia 8,3 World Country Ranking (2010) Peru 6,7 5 Colombia Mexico 6,0 20 Peru Chile 6,0 41 Chile Brazil 41 Mexico 5,3 73 Brazil Panama 4,7 109 Argentina Argentina 4,7 109 Panama Venezuela 2,3 178 Venezuela 0 2 4 6 8 10 Rating Ranking made up by 183 countries Source: Doing Business, 2010 (World Banck)
  30. 30. THE MOST COMPETITIVE FTZ’S IN LATIN AMERICA: 15% INCOME TAX AND ALLOWS SALES TO THE LOCAL MARKET 15% income tax. No import duties. Benefit from international trade agreements. Can also sell in domestic market. Permanent (PFTZ) Free Trade Zones Single-Company (SCFTZ) New regime in southern Colombia
  31. 31. 76 FREE TRADE ZONES Free Trade Zone Approved Single - Company Free Trade Investment commitments Zone Permanent Free Trade Zone Total Investment (USD 5.880 Million) Direct Jobs 44.475 Indirects Jobs 93.016 Investment executed so far Total Investment (USD 1.985 Million) Direct Jobs 5.017 Indirects Jobs 21.354 Source: Ministry of Trade, Industry and Tourism. The investment amounts required to obtain the Free Trade Zone status are calculated in Minimum Monthly Legal Wages (M.M.L.W). This information is presented in dollars using a US$1 = COP 2,000 exchange rate. For 2010, the M.M.L.W is COP 515.000. The M.M.L.W, as well as the exchange rate are subject to variations. 31
  32. 32. PERMANENT FREE TRADE ZONES (PFTZ) Several firms installed in a FTZ already established Requirements for industrial firms of goods and services Total Assets Investment Ammount Minimum direct jobs generation (US$) (US$ Million) 0 – 129,000 0 0 129,008 – 1.28 Million 0 20 1.28 – 7.72 Million 1.28 30 More than 7.72 Million 2.96 50 Source: Ministry of Trade, Industry and Tourism. The investment amounts required to obtain the Free Trade Zone status are calculated in Minimum Monthly Legal Wages (M.M.L.W). This information is presented in dollars using a US$1 = COP 2,000 exchange rate. For 2009, the M.M.L.W is COP 515.000. The M.M.L.W, as well as the exchange rate are subject to variations. Back
  33. 33. SINGLE-COMPANY FREE TRADE ZONES (SCFTZ) A single firm can get all FTZ advantages by installing itself in any place in Colombia Investment (US$ FTZ type AND direct jobs Million) Goods (1) 38.62 150 2.57 – 11.84 500 Services (2) 11.84 – 23.69 350 23.69 or more 150 Services – Ports (3) 38.62 20 SCFTZ Agribusiness (1) Each additional investment of US$ 5.9 million reduces 15 jobs of requirement. In any case, there must be generated at least 50 jobs. (2) For health services companies, 50% of jobs may be vinculated, not direct. (3) 50 indirect jobs can replace 20 direct jobs. Exchange rate: US$ 1 = COP 2,000. Minimum Monthly Legal Wages (M.M.L.W.) for 2010 is COP 515,000. Back M.M.L.W. and Exchange Rate are subject to changes.
  34. 34. SINGLE-COMPANY FREE TRADE ZONES (SCFTZ) A single firm can get all FTZ advantages by installing itself in any place in Colombia Investment (US$ FTZ type Or related jobs to the production Million) Agribusiness 19,31 500 Subsectors which are eligible for FTZ status under agribusiness requirements Biofuels Meat and Fish Oil and grease products from vegetables and animals Dairy products Legume and fruits, prepared or preserved, tea, soup, vinegar, sauces and yeast* Coffee * According to the national statistics this products classification is called “products not classified previously”. Back Exchange rate: US$ 1 = COP 2,000. Minimum Monthly Legal Wages (M.M.L.W.) for 2009 is COP 515,000. M.M.L.W. and Exchange Rate are subject to changes.
  35. 35. NEW SCFTZ REGIME IN FIVE PROVINCES OF SOUTHERN COLOMBIA Characteristics •Huila, Caquetá, Putumayo, Nariño and Cauca •No distinction between types of SCFTZs •Benefits are valid until April 30, 2010 •Time limit to execution of 100% of investment is 2 years. Requirements Investment And Direct Jobs US$ 1.2 50 Back Million
  36. 36. COLOMBIA OFFERS LEGAL STABILITY CONTRACTS TO GUARANTEE INVESTMENT PROJECTS Investments over US$1.84 million* (150.000 T.U)** Conditions Investor pays 1% premium based on the amount of the investment. 0.5% in unproductive periods. Period Up to 20 years maximum. Signed 62 legal stability contracts approved, 48 legal stability contracts contracts signed *The investment requirement is calculated with an exchange rate of COP $ 2000 = 1 USD. It is responsibility of the investor to calculate the investment requirement at the moment of submitting the application for the Legal Stability Agreement. ** One Tax Unit equivalent COP$ 24.555 or US$ 12,2 36
  37. 37. OTHER INCENTIVES BY SECTOR: INCOME TAX EXEMPTION FOR UP TO 20 YEARS • Exemption for 30 years for companies that build or restyle Tourism hotels before 2018. Eco-tourism Eco- • Exemption for 20 years starting from 2003. • Exemption for 10 years after the start of production in crops Late yield crops planted between 2003 and 2013. • Permanent exemption for investment in new forest Forestry plantations, sawmilling and timber plantations. • Publishing of books, magazines, booklets or collections of Editorial scientific or cultural characteristics are exempt until 2013. • Exemption for 10 years for products manufactured in New medicinal Colombia with high scientific and technological research products and software content, starting from 2003.c • Exemption for 15 years for sale (by the generators) of Renewable energy electricity based on wind resources, biomass or agricultural waste. • Exemption for 15 years starting from 2003 to provide River transport services in slabs and boats with net weight below 25 tons.
  38. 38. ¿Where are we coming from? ¿What are we doing? ¿Where are we going next?
  39. 39. POTENTIAL WORLD CLASS SECTORS PRODUCTIVE TRANSFORMATION PROGRAM "GOVERNMENT - PRIVATE SECTOR" Encourage and improve production of Promote development of competitive products & services NEW & EMERGING ESTABLISHED SECTORES SECTORS 39
  40. 40. BPO&O
  41. 41. Competitive • Call center agent cost: USD 441/month Operational Cost • 27,000 biz grads and 13,000 engineers per year. Human Resource • Seven cities > 500,000 inhabitants. • Neutral Spanish accent • USD 1 billion market, growing 42% in the last High growing market three years. • Reliable & redundant internet infrastructure: 5 Infrastructure submarine cables 212.5 Gbps capacity. • Free Trade Zone regime: 50% off Income Tax Business Environment and sales to the local market. Back
  42. 42. IT SERVICE & SOFTWARE
  43. 43. Competitive • The lowest labor cost in LATAM: up to 284% for Operational Cost System Engineering careers. Human Resource • 13,000 engineering and technical graduates from IT-related fields per year. • A growing market of US$ 270 billion: almost 12,5% in 3 years. High growing market • Datamonitor considers Colombia to be a Tier 2 country in L.A. • US$ 4 billion expected investment in Infrastructure telecommunications for 2010. • Computer prices under US$1,000 without VAT • National Government programs to enhance Business Environment competitiveness and development in this specific industry. Back
  44. 44. HEALTH TOURISM
  45. 45. • Eye laser surgery Innovation Innovation • Pioneer Program in reproduction immunology • 1st pacemaker of the world Business • First Latin American country to do business, according to Doing Business 2010 ranking - World Bank Environment • 4 consecutive years as one of the top 10 reformers in the world • Health system is the best in Latin America and number 22 in the world. • Colombia spent 7.5% of GDP on health and 13.9% of public spending Infrastructure • More than 600 weekly flights to Colombia connecting North, Central and South America and Europe Human Resources • 3,000 general doctors undergraduate per year • Hospital San Vicente de Paul (Antioquia) 1 Free Trade Zone – status granted • Clinica Portoazul (Barranquilla) -1 free trade zone approved ( Free Trade Zone pending status recognition) • Clinica Los Nogales (Bogota) , Promotora de la Laguna (Antioquia), Sociedad Medica de Sabaneta (Antioquia) - 3 clinics (in process to be recognized as a free trade zone) Back
  46. 46. COSMETICS AND PERSONAL CARE PRODUCTS
  47. 47. World Leader • The second largest country in number of species of plants in Biodiversity Human • More than 200.000 professionals and 30.000 technicians available Resources to work in the sector • In the last 6 years exports has tripled, arriving to US$735 million Export and a positive trade balance of US$ 300 million Platform • Trade Agreements with 44 countries reaching to cover 1.2 million consumers. • The highest female participation in the workforce in Latam (44.6%) Female Labor • Colombian women cosmetics pocket share duplicates the Participation European women (as proportion of their income). Fourth Market in Latin • 2008 Production: USD 2,361 M; CAGR 4.4% in the last 6 years. America • The masculine market is expected to grow 20% per year. Back 47
  48. 48. BIO-FUELS
  49. 49. •Single enterprise Fee Trade Zone. Tax Incentives • Income tax exemption on late yield crops during ten years • 16,5M ha (6.1 M acres) suitable for biofuel Land Availability production. • World’s fifth palm oil producer. (3,6 MT.) Raw Materials • Highest sugar productivity in the world. (12,78T/crop Availability year) • E20 B20 by 2020. • Ethanol local consumption (490M liters), supplied only Internal Demand in a 66% by local production • Biodiesel local consumption (55M liters) supplied in 20% • 34M Ha (85 M acres) available for agricultural and Environment & livestock development. No need to cut down rain forest Food vs. Fuel • Green seal” production (environmental and social practices). Back 49
  50. 50. FORESTRY
  51. 51. Land Availability •17 M ha (42 M acres) suitable for timberland Diversity • More than 10 forestry species with high value added • Photosynthesis throughout the year Production • Higher yield species advantage • Shorter life cycles • Weather advantages Biotechnology and • High quality forestry germplasm base with plant material genetic production capacity of 52,000 ha (131,000 acres) per development year • High quality forestry germplasm base with plant material Tax Incentives production capacity of 52,000 ha (131,000 acres) per year Back 51
  52. 52. AUTOMOTIVE
  53. 53. Dynamic Industry • Colombian exports of auto parts increased by 46% in (06-08) Excellent geo- economic position • Access to a Motor Vehicle Fleet of over 37 million units (FTAs) Qualified and competitive cost • Annually purchase over U$600 million in auto parts to local for human producers resources • The production of vehicles increased by 46%.(02-08) Recurso Humano • Automotive industry workers salary cost : 1.73 US$ /hour (2007) • Deposits enabled for transformation or assembly assure free custom duties for auto parts and material Advantages • Well-known auto parts companies are established in Colombia (12) Back
  54. 54. Electric Power
  55. 55. Energy • Best energy infrastructure in Latam. (IMD) • Third country in future energy supply in Latam. Infrastructure (IMD) Structure of • All entities in one system. (SIM) Energy Sector • 2nd country with best access to water in Latam • 742,725 watersheds Hydro-energy • 52,075 m3 /seg per year potential • Annual rainfall of 3,000 mm • Precipitation of 1,313 km3 • Average yield of 58 lt/seg/ km2 • Daily Average of 4.5 Kwh/m2. Solar-energy • Six Colombian states are above 1,200 Kwh/m2/year potential and 3 above 1,600 kwh/m2/year. Geothermal • More than 300 hot springs potential Back 55
  56. 56. TEXTILES, APPA REL, FASHION AND DESIGN
  57. 57. • Over 100 years of experience Experience in • Coltejer founded in 1907 textile market • Tejicondor and Fabricato (founded in 1920) • Colombia has the infrastructure to produce and export. Infrastructure • fibers, yarns, wovens and apparels . • There are more than 800,000 direct and indirect jobs . • Textiles exports´ share is 2.8% of the total exports and 12% of non Textile exports traditional exports. • Imports of raw products reached 81% of the total textile and Imports apparel products in 2008 Back
  58. 58. INFRASTRUCTURE
  59. 59. PUBLIC INFRASTRUCTURE PROJECTS ACCOUNT FOR US$ 21 BILLION • Projects to the construction, operation and maintenance Carreteras of main access roads of the country: • “Autopista de las Américas” Road Concession: 800 km of existing roads • “Autopistas de la Montana” Road Concession: Total length 1000km Puertos y • New ports development: Aguadulce (USD 103 M) and Aeropuertos Contecar (USD 297 Million) • Integration and Concession of Northeast Airports (USD 107 Million) Ferrocarriles • "Central Railway System“ Railway Concession: 1.045 km, estimated investment of USD 895 million Back 59
  60. 60. GRAPHIC COMMUNICATION INDUSTRY
  61. 61. • Global production process consisting of pulp production (U.S. $ 29,300 million), production of Sector paper and board (U.S. $ 87,000 million), design, printing and other graphic services (U.S. $ 582,000 million) and Marketing (NA) • Composed by Packaging and Labels (U.S. $ 238 million), advertising and commercial ($ 419 million), Editorial (U.S. $ 230 million), and newspapers and periodicals (ND). Industry in Colombia • Average annual income of $ 40 million in large players segment. • Annual growth above 11%, quite remarkable when compared with global industry growth (2.7%) • Exports grew 10% from 2006 to 2008. • Leading exporter of books in Latin America. International Trade • Second largest exporter in Latin America after Mexico • Only country in Latin America with a significant positive trade balance Back
  62. 62. CONCLUDING REMARKS In the last few years, Colombia has experienced a marked improvement in its macroeconomic performance, internal security and stability for businesses. As a result social indicators have improved dramatically.
  63. 63. CONCLUDING REMARKS Colombia has achieved a solid structural growth, based on an increase in the investment rate and higher productivity levels
  64. 64. CONCLUDING REMARKS The country has guaranteed its external funding for 2009 trough multilateral institutions such as IADB, WB and CAF.
  65. 65. CONCLUDING REMARKS Colombia is aggressively negotiating trade and investment agreements expanding its markets and becoming more attractive to investors.
  66. 66. CONCLUDING REMARKS The Colombian Government is committed to generating the most favorable conditions for domestic and foreign investment instruments such as the free-trade zones regime and legal stability contracts.
  67. 67. www.inviertaencolombia.com.co · www.colombiaespasion.com · www.mincomercio.gov.co
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