A Perspective On Colombia (2009)

Progress and Prosperity as Violence Recedes.

Colombia is a land of immense beauty, wonderful people, and a history they would call “complicated.”  Lately, a dramatic reduction in violence has caused an economic boom, comparing favorably to the difficulties in many other Latin American countries.  For investors, Colombia has an excellent location, vast resources, its government has followed strongly pro-business/pro-development laws and programs, and there is now a burgeoning middle class.  Everywhere you can sense the desire to throw off the past, to be a part of a future.

With all these factors, though, how well is Colombia doing at making the most of the opportunities?  What are the conditions of law and investing in the new environment?   These are the questions we seek to answer here.

On the positive side, as I said, Colombia has long been known for its central location and tremendous natural resources.  Now it also boasts a surging middle class and strong labor pool.   I base this statement on the fact that something like one-fifth of the population has moved above the poverty line over the last decade.    The economy has endured far fewer and less serious shocks and crises than all other Latin American countries.   The central and urban governments have been some of the most stable in Latin America for decades; despite the violence, the ordinary transition of elected governments and leaders has continued, and major social disruptions have not plagued Colombia like they are in Mexico, Venezuela, Ecuador, Bolivia, and Argentina, and as they have plagued Brazil and Chile.

What are the pro-investment/pro-development policies and programs?  How are these programs working?  Who is taking a closer look at things in Colombia?  Read through the Posts and see what you think.

Some answers were clearly on display at the 50th Annual Meeting of the Inter-American Development Bank this spring in Medellin.  Financial and political leaders from Latin America and around the world included heads of state as well as headliners like Bill Clinton, Timothy Geithner, Arnold Schwarzenegger, and People’s Bank of China Governor Zhou Xiaochuan.  Residents of Medellin and Antioquia — “paisas” as they call themselves — hosted newsmakers, and they made news of by showing off a vibrant, beautiful city with a rapidly growing economy.

That is not the Medellin many thought they knew.  Colombia, in fact, is not what many on the outside thought.  Therein lies its opportunity.

All these developments indicate that Colombia is open for business.  Over my ten years of visits, I have seen the country open for travel to the mountain cities, coffee region, and flower farms, as well as the coastal cities, beaches, and parks.

Yet, much progress remains to be achieved.

A Land of Rich Irony.

Colombia, for all its recent success and attractiveness to investors, is still the land of Gabriel Garcia-Marquez’s magical Macondo, a land of many ironies:

• Reformist politicians have achieved much, yet some are under investigation for connections to lawless paramilitary groups.
• Peace and justice legislation and economic and social progress have caused the paramilitaries and Marxist guerrilla movements to fade considerably, yet they have yet to disappear entirely.
• Wealth concentration has changed dramatically in recent years and a genuine middle class is emerging, yet there are millions of internally displaced persons and leading families control much, if a shrinking portion, of the wealth.
• Laws liberalizing private equity funds and foreign arbitration, encouraging free trade zones, promoting legal stabilization and good corporate governance, and adopting more rigorous legal professional standards reflect the dominant recent trend, yet old-fashioned bureaucracy and red tape remain.
• The judicial system has highly qualified members, yet it reportedly has pockets that remain vulnerable to influence and corruption.
• Foreign travel is growing rapidly, but with many excellent tourist facilities, they are playing catch-up.
• Commercial development and industrial investment are, more and more, matched to meaningful social development programs and environmental awareness, yet in mining, forestry, petroleum, and agriculture, as well as labor organization and journalism, much more is needed to come to world-class standards.

These ironies and the speed of country’s transformation make Colombia a rich subject for study, particularly in terms of how law affects enhanced stability, promotion of trade and investment, creation of new infrastructure and development, and transformation of society through peaceful means that displace entrenched violence.

About Me

I am an American lawyer, married to a Colombian, living in New York City.  I have traveled to Colombia frequently over the last ten years. During this time, I have taken an increasing interest in legal and investment issues and opportunities. This website is my way of making a serious independent study of the issues covered here and sharing my learning and perspectives so we can all profit in our own ways.