That is the topic of my latest Bloomberg column. I am ultimately optimistic, but let me present the case for the negative:
Yet those positives have been in place for a while, and the results are less than earth-shattering. By World Bank estimates, Colombia has a per capita income of slightly more than $16,000, using purchasing power parity standards. For purposes of comparison, Mexico comes in at slightly over $20,000. Argentina is considered to have been an economic failure since the Peronist years, but still has a per capita income exceeding $22,000.
Also troubling is the country’s export profile. After fossil fuels, which have a limited future, the country’s leading exports are coffee, gems and precious metals. None of these is large enough or sophisticated enough or training enough quality labor to push the nation over the top. When it comes to complex manufacturing, the country is lagging well behind Mexico and Brazil, much less South Korea.
A pessimistic view of Colombia would cite the country’s very different geographic regions that have never seen full economic or even political unification. The lack of a fully developed nation-state has been reflected in the country’s ongoing troubles with guerrillas and drug lords. The major urban centers of Bogotá and Medellín are both deep in the interior, surrounded by mountains, and unable to take advantage of major navigable rivers. There is no world-class port or harbor, and except for its connection to the US, the country is inward-looking and has attracted relatively few immigrants, recent Venezuelan refugees aside. The Amazon cuts off Colombia from much of the rest of South America. De facto Colombia has no richer neighbor to pull it up by its bootstraps, Panama being much too small and most of Brazil being too distant. Colombia’s problems also include a recent uptick in troubles with former guerrillas.
I look forward to my next visit to the country…