Colombia, a growing Investment Market
Giambrone’s Milan office hosted a meeting with PROCOLOMBIA, the Colombian government’s agency for the promotion of foreign inward investment in Colombia. The objective was to investigate and evaluate the business opportunities between Colombia and Italy, not natural bedfellows, and to see if the investment environment between the two countries offered any commercial opportunities.
Colombia has five distinct regions Caribbean coast; Pacific coast; Amazon; Plains; and the central Andean heartland. It is the fourth largest coffee producer in the world and is also rich in emeralds. The four main industry sectors are oil and gas, mining, financial and professional services and agriculture, including palm oil and cut flowers as well as coffee.
The Colombian economy is steadily growing at 3% per year, however recently this has been seen to slow but the economy is expected to rally later in the year with an anticipated growth rate of 2.5%. Colombia remained within its designated employment rate of 10% in 2018 but has exceeded its projected inflation rate but it is expected that this will fall by the end of the year returning to a forecast of between 3.0% and 3.3%. Colombia achieved accession to both the Organisation for Economic Cooperation and Development (OECD) and has worked hard to apply transparency rules in terms of State Owned Enterprise’s (SOE) good governance and public accountability, and it implemented changes in the tax and pension regulations. The final accession was approved in May 2018.
For investors planning to play the long game, there are opportunities that appear to offer a good return. Colombia has worked hard to develop policies to encourage investment and free trade; as well as incentives to assist trade alliances to flourish. The Political Constitution states that foreign direct investment (FDI) received the same treatment as the local investment with the exception of a limited number of particular situations. Colombia is considered to have one of the most open investment regimes, with a fair and transparent legal framework for FDI. There is no requirement for previous authorization by any national authority, except in some specific cases, other than registration in the Central Bank (Banco de la República). Such registration is required for statistical purposes only. Colombia is also part of several double taxation agreements that prevent investors from being subject to double taxation.
Foreign investors in Colombia are advised to channel their activities through a legal entity, however, they do not need a local partner or investor; with very few exceptions a legal entity can be foreign-owned with no legal restrictions on subsequent repatriation. The Colombian business community is friendly and likes to engage in small talk before getting down to business; any interaction outside the meeting room is regarded as social so there will be no working lunches.
There are many other advantages to investment in Colombia which is positioning itself as a leading destination for investment. For many
reasons, we are glad to formally announce the beginning of mutual support between Giambrone Law and ProColombia Italia. We are sure that this will be the beginning of an association that will facilitate the consolidation of an international market between both countries.
For more information about investment in Colombia please email firstname.lastname@example.org or telephone 020 7183 9482