Ministry of Finance: Colombia GDP to Grow by 2.7% This Year and 3.4% in 2019

The Colombian government expects the nation’s gross domestic product (GDP) to grow by 2.7% with a stronger second half of the year, Finance Minister Mauricio Cárdenas said this week.

This figure is in line with an identical recent forecast from the central bank and represents a significant improvement from the disappointing 1.8% registered in 2017.

Cárdenas projected 3.4% in 2019 in the first full year under the new government of the new president who will be elected tomorrow in Colombian presidential election. In 2020, the nation will continue its recovery with 3.6% growth, according to Ministry of Finance projections.

For 2018, the ministry expects the financial services sector to help drive growth, with the industry registering a projected 6.1% growth that will help make up for contraction in both the mining and construction sectors.

Due to ongoing uncertainty surrounding the election, oil prices, and the overall economic situation in Colombia, projections for economic growth this year have differed significantly.

While virtually all analysts expect better results than 1.7%, domestic research organizations ANIF and Fedesarrollo have forecast growth rates of just 2.3% and 2.4% this year, respectively.

On the higher end, the World Bank and International Monetary Fund (IMF) started the year with predictions of 2.9% and 3.0%, respectively. In May, however, the IMF dropped its projection to match the 2.7% now expected by the Ministry of Finance and Banco de la República.

For 2019, the IMF has projected 3.3% growth, the Bogotá-based Fedesarrollo has forecast 2.8%, and the Colombian central bank has projected 3.7%.

Photo: Colombian Finance Minister Maurcio Cárdenas. (Credit: World Economic Forum)