Exports were up in the first quarter of 2018 across Latin America, and Colombian exports, with a year-over-year growth in value of 13.9% from the first quarter of 2017, were among the highest risers in the region.
Among large economies, only Chile (up 24.3%) showed a higher increase, according to a new report from the Inter-American Development Bank (IDB). Bolivia (21.9%) and Uruguay (16.1%) also outperformed Colombia.
“After a long period of declining trade, the rise in export volumes is good news,” said Paolo Giordano, coordinator of the report and principal economist for the integration and trade Sector of the Inter-American Development Bank.
While the rise in the price of oil accounts for some of this growth, Colombia also showed improvement in overall export volumes. “Colombia and Argentina managed to increase real exports by 7% each in the first quarter, following a period of relative stagnation in 2017,” stated the IDB report.
This builds on the significant progress Colombia showed last year on export value. “Colombia recorded an export boost of 19% in 2017,” stated the report. “Almost 40% of the variation was driven by sales to Latin American and the Caribbean (24%), in particular to Panama, Bahamas, Mexico, Chile, and Brazil. Foreign sales to China and the rest of Asia recorded remarkable increases of 60% and 56%, respectively, and contributed a fifth of total growth. Three quarters of the expansion were driven by sales of oil due to an increase in prices despite a stagnation of volumes.”
Still, despite the positive figures, the report notes that oil is the primary driver of growth and that growth is merely a sign of gradual recovery and not a return to the boom times from earlier this decade. “Export volumes stand a full 25% below their 2011 peak” region-wide, stated IDB.
The recovery in Colombian exports is also slowing down. Along with much of the region, it started to recover its exports late year, with 18.9% first-quarter growth in 2017 compared to the same period in 2016.
Nevertheless, further encouraging results come in the form of the location that Colombia is sending its goods and services. When breaking the numbers down by destination, Colombia had its best growth in terms of exports to the rest of the region (54.6%), which has been a focus for public officials and various stakeholders in the Andean nation and points to progress in diversifying away from an over-reliance on the U.S. as a trade partner.
This was by far the biggest intraregional increase registered by any country. Ecuador ranked second in this respect, with a 30.6% increase, and the regional average was 16.3%.
The nation also increased its trade figures with the world’s two largest economies. Colombian exports were up 19.1% to China and 8.1% to the United States.
The news wasn’t all positive, however, with a significant decline of 14.0% in exports to the European Union and a drop of 24.8% to the rest of Asia excluding China.
The export figures come in a quarter in which the Colombian economy grew by 2.2%. While this remains below the nation’s potential, according to economic analysts, this is above the disappointing 1.8% full-year annual growth recorded in 2017.
Economic forecasts have varied considerably on how Colombia’s economy will perform in 2018. While all major international and domestic institutions see recovery this year, uncertainty over this month’s presidential election, among other factors, have left the predictions from high-profile groups ranging from 2.3% to 3.0%.
Photo: The Port of Barranquilla, one of the key sites that facilitates Colombian exports. (Photo credit: Puerto de Barranquilla)