“Today’s designation targets members of Los Urabeños who have endeavored to expand the violent drug trafficking organization’s international influence,” said OFAC Acting Director John E. Smith.  “Treasury will continue to aggressively expose and disrupt the global financial and distribution networks of Los Urabeños and its illicit supporters.”

Los Urabeños has recently endeavored to extend its drug trafficking and money laundering operations to Europe.  

On May 31, 2013, President Obama identified Los Urabeños (also known as Clan Usuga) as a Significant Foreign Narcotics Trafficker pursuant to the Kingpin Act.  Los Urabeños is currently the largest BACRIM (banda criminal or criminal group) operating in Colombia.  It is organized as a network of smaller, loosely affiliated groups engaged in cocaine and arms trafficking, money laundering, extortion, and drug debt collection.  Numerous members of the group utilize go-fast vessel operations to move drug loads between Colombia’s Caribbean coast and various locations throughout Central America and Mexico. Additionally, Los Urabeños has recently endeavored to extend its drug trafficking and money laundering operations to Europe.

The individuals designated today include Victor Alfonso Mosquera Perez (a.k.a. “Negro Mosquera”), who is involved in controlling narcotics trafficking operations for Los Urabeños from Colombia to Europe.  Also included in the designation is Alveiro Feo Alvarado (a.k.a “Benavides”), a financial chief for Los Urabeños who was involved in forging alliances with the Revolutionary Armed Forces of Colombia (FARC) and rival Colombian drug trafficking organization Los Rastrojos.  Feo Alvarado was also involved in narcotics trafficking in Colombia on behalf of Los Urabeños.  Mosquera Perez and Feo Alvarado were indicted by the US Attorney’s Office for the Southern District of Florida on narcotics-related charges in May and September 2014, respectively.

Also designated today are two Colombian companies controlled by Mosquera Perez: De Expomineria S.A.S. is a mining company based in Medellin, Colombia, and Joyeria MVK is a jewelry business based in the Urabá region in Northern Colombia.

Since June 2000, more than 1,800 individuals and entities have been named pursuant to the Kingpin Act for their role in international narcotics trafficking.  Penalties for violations of the Kingpin Act range from civil penalties of up to $1.075 million per violation to more severe criminal penalties.  Criminal penalties for corporate officers may include up to 30 years in prison and fines up to $5 million.  Criminal fines for corporations may reach $10 million.  Other individuals could face up to 10 years in prison and fines pursuant to Title 18 of the United States Code for criminal violations of the Kingpin Act.

The following individuals have been added to OFAC’s SDN List: FEO ALVARADO, Alveiro (a.k.a. “BENAVIDES”), Colombia; DOB 16 Jun 1967; POB El Paso, Cesar, Colombia; citizen Colombia; Cedula No. 77162067 (Colombia) (individual) [SDNTK] (Linked To: LOS URABENOS). MOSQUERA PEREZ, Victor Alfonso (a.k.a. “NEGRO MOSQUERA”), Colombia; DOB 14 Sep 1984; POB Turbo, Antioquia, Colombia; citizen Colombia; Cedula No. 8358401 (individual) [SDNTK] (Linked To: LOS URABENOS). The following entities have been added to OFAC’s SDN List: DE EXPOMINERIA S.A.S. (a.k.a. DE EXPOMINERIA S.A.), Calle 40, 81 a 15, Medellin, Colombia; NIT # 900328871-2 (Colombia) [SDNTK]. JOYERIA MVK, Calle 100 # 10-29, Turbo, Antioquia, Colombia; NIT # 8358401-7 (Colombia) [SDNTK].

Colombia Peace Process

I am very pleased to see that the Colombian government and the Revolutionary Armed Forces of Colombia (FARC) have reached major breakthroughs on the outstanding issues in the peace process negotiations:  transitional justice, disarmament, and a timetable for signing a final agreement.

The announcements made today at the peace talks in Havana represent historic progress toward a final peace agreement to end more than 50 years of armed conflict.  Peace is now ever closer for the Colombian people and millions of conflict victims.

We applaud President Santos and his negotiating team for their efforts to reach a just and lasting peace with the FARC.  We are hopeful the parties will soon conclude a final agreement to end this terrible war.  The Colombian people deserve a just and durable peace, and this will be their victory.

I have called President Santos to congratulate him and his negotiating team for their courage and commitment to the peace talks under extraordinarily difficult conditions.  The President and I have met on several occasions since the talks began, and we speak regularly by phone.  I have also met twice with Colombian government negotiators.

Last December, in Bogota, President Santos asked whether the United States would support this process by appointing a Special Envoy.  President Obama and I agreed, so we appointed former Assistant Secretary of State Bernard Aronson, who has been deeply involved every step of the way, including in the most recent round in Cuba last week.  He will continue to stay closely engaged in this process.

I also must express my deep appreciation to Pope Francis for his moral leadership and the Vatican’s good offices in the quest for peace in Colombia.  We also underline the important roles played by Norway and Cuba as guarantors of the peace process.

U.S. support for Colombia dates back more than 15 years to Plan Colombia, a bipartisan initiative carried forward and sustained by Presidents and Congresses of both parties.  I consistently supported Colombia as a United States Senator.  However, Colombia’s success in waging war and now in waging peace is a testament to its leaders, civil society, and democratic institutions, including its armed forces and police.  Today we salute all Colombians and urge the parties to finish their negotiations and construct the peace and prosperity Colombians richly deserve.  We will continue to support President Santos and the Colombian people as these negotiations move forward.

Finance Colombia’s executive editor Loren Moss was recently able to sit down with Michael McGee, the Regional Commercial Counselor for the US Commercial Service, based out of the Embassy, to discuss the free trade agreement, and the services that the US Commercial Service provides to US companies seeking to do business in Colombia.

Finance Colombia: This embassy is gigantic; it’s one of the largest US embassies in the world, isn’t it?

McGee: Yes, it ranks up in the mega-embassies around the world, depending on what you talk about: number of agencies in them, or number of personnel, there are different ways to look at it, it doesn’t really matter. It’s just one of those top three to five or so embassies around the world, pretty much in any way that you slice it. And the US government tends to focus on having big regional operations so that they can support smaller countries around them. For instance, my office—I manage the operations in Panama, Peru, where we have offices; but I also manage what we call partner posts in Bolivia and Ecuador, so we have offices there as well, which are manned by the State Department. But our expertise and our services and administrative support for them is provided through our office here in Bogotá. I was in La Paz, Bolivia last week.

Finance Colombia: Oh, interesting, I didn’t know that, but that makes a lot of sense then, to do—kind of have—like a super embassy and then to do things remotely, especially when you go to smaller countries like Bolivia which have a smaller population and less economic activity, then you’d be able to support them.

McGee: That’s right.

Finance Colombia: That makes sense, so the commercial section is here to help promote investment, to help promote trade; so for a US company that has a product or service to export and they’re looking at maybe setting up operations or not even setting up operations but just opening up a new market, I think a lot of times they might not know where to start or when would it be appropriate for a company to contact the commercial section, and what kind of services are out there for US companies that want to look at Colombia. They hear a lot of things, they hear that Colombia is improving  in a lot of ways, the economy is growing, it is now the third largest economy in Latin America, and so people have their eyes on Colombia. I run into this all the time, but they don’t know where to start. And they know their business, they know their product, but they don’t have a lot of experience in Colombia, they just hear that it’s a good place to do business. How can the commercial section offer them guidance in that respect?

McGee: They should immediately try to get in touch with us. We would always try to link in our domestic offices, we have a domestic network that is sort of a counterpart operation for our overseas side, we’re in about 80 countries and about 100 sites in the United States; and I say sites because sometimes a major city like New York or Los Angeles may have several offices just to make it convenient for them. We have all of these different networks, and they all work with the companies to help make sure they can get information without having to go overseas and they are about trying to assist, whether the particular market that they may be interested in, Colombia in this sense, would be actually a smart move for them. So we provide a lot of market information, you can go to our website, export.gov and the it would be forward slash Colombia in this case, and you can find general information about our markets, contacts…we just got through uploading our new country commercial guide which will tell you pretty much the contact information, how to do business in the country, what are the best prospects for you as exporters, how to invest, it will tell you the pitfalls as well as the opportunities, it’ll give you recommendations on that, and then of course it’ll link you back to the services that we provide.

US Commercial Service Regional Commercial Counselor Mike McGee

We just had a trade mission that left from Automation Alley, which is around the Detroit area, we have one about each month, because this is a popular place, so that will bring in from five to ten or so companies, sometimes led by government officials or industry officials, and we’ll help them to set up appointments and be able to identify people that might be interested in doing a joint venture or representing them, or helping them to participate in government tenders. Sometimes they’re just exploring, they may be coming just to learn about the market. They’re not necessarily ready, they may be concentrating on a different market and they want to come in and learn about this since there’s an opportunity to come with the mission. We also work with a lot of individual companies, and we have some packaged, branded services that are fairly well known, but we try and we really endeavor to make sure that we customize as much as companies want. Every company has a little bit of a different way that they want to approach in their company’s philosophy for how they get into a market, and so we try to make sure that we will adapt what we’re doing for the company to make sure that it meets their needs and their strategies for how they get into it.

1,700 companies that were not exporting before the free trade agreement that are now exporting to the United States.

We’ve changed quite a bit over the last few years, particularly because we had free trade agreements in a lot of different places, and as you’re reading in the states, now there are several very important trade agreements that are being negotiated and a lot of those bring in along with them, not only just the elimination of tariffs and barriers, quotas, things like that, but they also create situations where we need to be working to help to make sure that these non-tariff barriers or regulations or different things that might be implemented by a country, new kinds of standards, labeling requirements, certification requirements and all these things that come into play when a country opens up its markets to the United States, those can be impediments for companies to try to work through.

I’ve always considered them as part of growing pains for a country. For instance, Colombia, before we had a free trade agreement with them, they didn’t have a lot of their institutions for customs, or their equivalent to the FDA or just a lot of different organizations and government that we’re involved in trade and doing business to bring the products into a country, they were very underdeveloped, and so therefore they might just recognize, for instance, an Underwriters’ Laboratory (UL) seal. Now as a free trade country, a partner in this, they had to create their own, and they had to harmonize over a certain period of time, so that brings into play—they may not be done in a very smooth and easy way, so we work with them, either through programs like with USAID or one of our other organizations like TDA, the Trade Development Agency, to help to try to smooth these out and work through some of these issues.

United States companies had to pay a very substantial tariff to get their products into Colombia before we had the free trade agreement, and that went away or has been slowly going away. About 80% of our tariffs were eliminated with the onset implementation of the free trade agreement, and so obviously that’s a big discount for our companies compared to an Asian company, or it could be an European company or somewhere else, perhaps in Latin America, somewhere else in the world, so automatically there was an advantage for our companies.

And so, compliance with agreements is something that, particularly with President Obama’s administration, he wants us to make sure that our agreements are working to our benefit and trying to make sure that we are—that our partners are following the agreement as it was negotiated and not as it was implemented, so those can be challenging and making us have to reach into work very closely with their agencies to make sure that an agreement doesn’t become an impediment for US companies.

Finance Colombia: Right, it’s interesting that you mention that because I’ve seen effects of how  it’s benefitted Colombia. I like to watch the Congress Channel sometimes down here, and I was watching it and they were interviewing a farmer, and he was talking about how they have to produce a much higher quality of produce, because he said “Look, now we have access to the international market which is a good thing for us but we had to improve the quality of the products that we were producing because now, whether we sell it domestically or internationally, our produce meets international standards.”

I go into the grocery store, Surtifruver here in Bogotá and I see US pears and there’s a coordinated marketing effort. Just like people want French wines, people here want US pears and that seems to show successes on both sides that are obvious.

McGee: Yes, you know, one of the things that’s hard to measure, and you can see and it’s easy to talk about if you just look at the numbers because United States companies had to pay a very substantial tariff to get their products into Colombia before we had the free trade agreement, and that went away or has been slowly going away. About 80% of our tariffs were eliminated with the onset implementation of the free trade agreement, and so obviously that’s a big discount for our companies compared to an Asian company, or it could be an European company or somewhere else, perhaps in Latin America, somewhere else in the world, so automatically there was an advantage for our companies.

Now the US is an open market and we had special programs for Colombia for instance, and they benefitted very much from those programs but they were—they already had an open market, no quotas, almost zero if not zero tariffs for most of the products they sell to the United States, so therefore what’s the margin? They’re not going to see a boost in theirs, but you know what, when you talk to the companies here, they’ll tell you that having the security of a free trade agreement, because it’s a treaty, and it’s an agreement that’s not going to have to be renewed unilaterally by the United States on an annual basis, and I can tell you about some of the countries now, we have—out of my five countries, three of them are free trade agreement countries, but countries that don’t have a free trade agreement and that are looking for getting their products into the United States through utilizing GSP, General System of Preferences, which gives them an advantage on tariffs of getting their products in, they can’t be competitive if they don’t have those.

So they’ve got this now, all that goes away, they don’t have to worry about an annual basis in which congress, which could be debating and say “you know, we’re not going to renew this benefit program,” so they’re able to say “Ok, you know what, I’m going to—now I know that this is going to go on, I can make a five year plan, I can invest in modernizing my production capacity, or expanding my production capacity for whatever product that I’m exporting or producing here locally, so there’s a huge benefit for them, but that’s not an easy benefit to measure, that peace of mind and the security that they’re able to continue to do business without having to worry whenever that deadline comes and all of the sudden, “well, am I going to be able to be competitive in the US market, or even have access to the US market anymore after this?” With the free trade agreement they don’t have to worry about that.

As we we’re growing up we knew Colombia for coffee. Well, Colombia now wants to be known for high quality cacao…chocolate.

Finance Colombia: That’s a  great example, because when companies look at making capital investments, you look at the tremendous investment that US companies have made in Mexico. I was in Monterey in all the factories, and high tech factories too, making plasma TVs and making cars, and things like that, and you look at the companies that are coming into Colombia and making those long term investments because they know that they have that stability of that treaty versus just kind of a “we’re going to give this to you as a favor, but know we have a bilateral agreement,” and also I think that the other benefits that are in comprehensive free trade agreements.

I know, for example, NAFTA has NAFTA Visa provisions, I would imagine that the agreement with Colombia does too, and different things that make it easier to do business between the two countries that go even beyond simply the reduction of tariffs or tariff stability, and I think that as Colombia tries to diversify its economy from being so dependent upon petroleum, and even coffee is still a significant part, but as they try to move up the value chain with professional services and with manufacturing and that kind of thing, it can only help  because even where Colombia wasn’t benefiting before it’s because they were not yet exporting a lot of high value products, as they’re trying to develop a strategy, as the government has said that it wants to do. Now that kind of connects as an accelerant or a catalyst to help them do that, which of course benefits us in the United States as well.

Have there been any particular success stories or cases that you can refer to as far as companies that have been able to really take advantage of the free trade agreement and establishing their presence here in Colombia?

McGee: I think that probably the best examples are, I want to say 1,700 companies that were not exporting before the free trade agreement that are now exporting to the United States. That’s a pretty significant number. I think probably the biggest area has been in the agricultural sector. And we have seen—we were doing some research recently and we went up to visit several companies who had been involved in the free trade agreement and they had all talked about having—they had access, but they now have the security and they have expanded their production capacity already because of the free trade agreement, because they knew that they were going to be able to move into different areas. One of them was a chocolate factory that we both visited not too long ago, and this company, they’re producing the high end, they’re not producing, you know, just some old chocolate bars, they’re producing for the gourmet market in the United States as well as in Europe, and they’re competing and so they’re investing in the research and development capacity of the country, even over their own competitors, to raise the quality of the crop of the cacao. That’s having a huge impact on the country. As we we’re growing up we knew Colombia for coffee. Well, Colombia now wants to be known for high quality cacao—chocolate, and so they’re moving pretty much into that area. We learned as we were talking to them, and beginning to look into this, that there are parts of the country where the combatants and hopefully soon to be ex-combatants live, or are located, that are ideal for the production of cacao, so this is a good substitute crop for coca.

Finance Colombia: Over in Arauca or down there by the Ecuador?

McGee: Exactly, as global warming is having its impact, coffee is set to move further up the mountain side.  Now, that area where those crops left is perfect—a perfect place for cacao. So it’s a response even to the global warming trend, it’s had a massive impact on the environment, on employment, on crop substitution, it’s much more than just simply making a nice quality product that the country can export, it’s having a multidimensional impact, now part of that is the free trade agreement,

But that’s not all, that’s just having a different mentality about looking at how you are, or how you want to do business, it’s not about just selling inside the country. The country on the other hand, has real serious challenges on infrastructure, how to get from one place to the next, and that’s making it difficult for Colombia to take full advantage. It’s an impediment to their competitiveness, and they have a major project, infrastructure project…

Finance Colombia: 4G

McGee: Exactly, that they recognize it’s really important for the future of the country because it’s very difficult to get a lot of the production capacity and a lot of the products, either from the port to the interior cities in Cali, Medellín, and Bogotá. Hopefully when the peace agreement is finalized it would make the availability of a lot of farmland and a lot of capacity for production increase dramatically.

That’s what so many people don’t understand, that free trade agreements give a lot of benefits to US companies to work on an open, leveled, fair playing field to do business, and that is really good for everybody because that brings along our commercial values: we believe in transparency, we believe in entrepreneurship, we believe in fair play, we believe in respect for intellectual property, those are American commercial values and wherever we go we try to make sure that those get emulated and get implemented to the best way possible.

Finance Colombia: Exactly, in my role as providing analysis, I always say that one of the biggest impediments in Colombia has been the ground infrastructure. Colombia is blessed with these beautiful mountains but these beautiful mountains are also very hard to get around in.

McGee:  They are.

Finance Colombia: I would imagine that you probably see a lot of instances where companies can get valuable guidance from the commercial section if you’re going to do business down here. Obviously you can’t be their law firm, but you say “these will be some of the things that you will need to look at and consider as you do your due diligence,”

McGee: Oh, yes.

Finance Colombia: And you guys offer that kind of service?

McGee: Very much so, that’s very much of our bread and butter, of trying to talk to US companies as they may begin to make their contacts, negotiations with different people, with different businesses and trying to set up their operations here, or select a methodology for how they’re going to enter the market, very much knowing these details, and we have, as you know, local staff who are very much experts and are well connected and understand very much how the host country, or in this case, the Colombian government, how their industries work, and I like to say that it sort of the personalities of the industries because some industries are much more fast moving, so much more complicated, and some are very much more difficult, or maybe easier to try to set up your business and how you’re going to do that. But understanding what kind of commission rates, are prevailing, what to make sure that you put into your contract or your representation agreement; you know it’s very important to know what kind of structure and relationship you have and what kind of clauses you put in there for performance or for non-performance,

How you, and even if you don’t have to deal with, but you must understand how the tax structure functions because it’s not uncommon for us to get a call from somebody that says “hey, my representative, my distributor, or my partner, they won’t pay me, they said that because there’s some tax issue or some—or they can’t get money from the bank,” or something, and it’s like “well wait a minute, but there is no impediment,” or that kind of thing. So we’re here, and especially our local staff, are here to be able to answers those kinds of questions. But something that I think is really important, to kind of go back to part of what you’re focusing on, the free trade agreement, our free trade agreements are a lot more than just saying “let’s reduce tariffs,” or “let’s reduce certain types of quotas or certain restrictions on this,” our agreements are almost universally, increasingly more sophisticated. We’ll say “You must respect intellectual property,” which is probably one of the United States’ most valuable assets, and so for us to say: you have to implement laws that make stealing somebody’s intellectual property a criminal offense and you must enforce it and you must set up the bodies to do that, and that’s what we do: It’s monitoring whether or not those things are going on. You must streamline the process for setting up business, for instance. These are all good things for the locals, as well as they are for our companies, because when it’s more efficient to do business here more business is done and more the business more jobs that are created,

Finance Colombia: And their economy grows.

McGee: Exactly, all these things, and so the free trade agreements are pretty much the catalyst for all of those kinds of development, for regulatory and legal frameworks and governmental bodies that maybe didn’t work or were working to favor special interest groups instead of being fair and open. So when we work in negotiating those free trade agreements and when they’re signed and ratified and then go into effect, then we have a tool to say “here, you have to do this,” or you know “here’s the consequence for this,” we now have instead of us saying “Ok, we understand, we feel sorry that this or that, we’re going to give you all of this and we don’t get anything In return.”

That’s what so many people don’t understand, that free trade agreements give a lot of benefits to US companies to work on an open, leveled, fair playing field to do business, and that is really good for everybody because that brings along our commercial values: we believe in transparency, we believe in entrepreneurship, we believe in fair play, we believe in respect for intellectual property, those are American commercial values and wherever we go we try to make sure that those get emulated and get implemented to the best way possible. It doesn’t mean that the US is always going to beat the German company, or the Japanese, or a Chinese company, or another American company, or a local company, but it does mean that you’ve got an environment in which you can be predictable, you can understand what’s going to happen, you can understand the consequences, you have legal bodies, arbitration… Arbitration is very often a part of our free trade agreements and how we’re going to get  fair treatment instead of being manipulated or being in a situation where it’s not a real clear and transparent environment to try to do business.

“This is truly a transformative transaction for Murray Energy. Acquiring assets in Colombia will broaden our international presence in an attractive market and position ourselves to better serve our customers around the world,” said Robert D. Moore, Executive Vice President, Chief Operating Officer, and Chief Financial Officer of Murray Energy.

Murray Energy is the largest privately owned, underground coal company (as opposed to strip, or surface mining) in the United States, with active mining operation in six states. The action comes as the Obama administration continues with its policies that are widely considered hostile to the domestic coal industry. “If someone wants to build a new coal-fired power plant they can, but it will bankrupt them because they will be charged a huge sum for all the greenhouse gas that’s being emitted,” said then candidate Obama, in 2008. Earlier this month, President Obama announced restrictive new measures targeting coal burning power plants in the US.

“As the United States coal industry continues to be under attack for elimination by the Obama Administration, we must look to international markets to ensure our survival,” stated Mr. Robert E. Murray, Chairman, President, and Chief Executive Officer of Murray Energy. “We are very excited about this new venture, which solidifies Murray Energy’s position as a premier coal producer and exporter in the international marketplace.”

Low commodity prices combined with domestic energy policy have threatened prospects for the US domestic coal industry. The move by Murray Energy is seen as diversification outside of the US market. Along with E.On Global Commodities SE of Germany and a group of operators, Murray Energy has established Javelin Global Commodities to market coal and other commodities on a global basis. Based in London, England, Javelin has entered into a long term export marketing and domestic advisory agreement with parent Murray Energy, and a long term hedging and credit line with E.ON.

“The low sulphur, excellent blending Colombian coal, which Murray Energy will now produce at Murray Colombian Resources, is an ideal complement to the high heating value, low cost coal from Murray Energy’s mining operations in the United States,” said Peter Bradley, Javelin’s new CEO.

“We’re no longer just competing with fellow coal producers. Today we’re also in a head-to-head battle with low natural gas prices. Javelin will assist Murray Energy in offering new products to our customers to allow them to compete in the electric power marketplace, such as variable pricing and volume fuel options, and contracts that include physical power offtake, tolling, and power price hedging to lock-in margins,” said Moore.

EAFIT now offers 21 undergraduate degrees, 65 specializations, 33 masters’ degrees, and four doctorates, across their colleges of Administration, Engineering, Sciences, Humanities, Law, Economics, and Finance. The university, with the principal campus located in the south of Medellín, just off of the Aguacatalá metro station, also has satellite campuses in Bogotá, Pereira, Llanogrande, and an MBA-specific campus in the Central American country of Guatemala; as well as several growing international alliances.

Above rendering (courtesy Grupo Argos): the new Centro Argos Para La Innovacion being built on EAFIT’s Campus

Finance Colombia’s executive editor Loren Moss sat down with EAFIT’s rector, Dr. Juan Luis Mejia Arango, in his Medellín offices to talk about EAFIT’s past, present and future.

Finance Colombia: We could start with a bit of the history. I understand, as I have heard, EAFIT was founded by a group of businessmen here in Antioquia to improve the quality of education. How was that?

Dr. Mejia: This university is 55 years old. It was founded in 1960, in a critical moment in all of Latin America. We were entering a new development model, known as the “The Cepalino Model,” through the Economic Commission for Latin America (CEPAL); a new economic focus for Latin America. That change of paradigm can be now summarized as: industrialization towards the inside, import substitutions, production of goods and services, which generated a grand shift towards urbanization here in Medellín, which already had a strong industrial base. By the end of the 1950s, businessmen of the city realized that they had a need for qualified managers for their companies. They did a study and the directors of our companies and big industries found out that they had engineers and lawyers, but there was no real professional management corps in Colombia.

EAFIT’s Rector, Dr. Juan Luis Mejia Arango (left) explains the university’s vision to Finance Colombia’s Loren Moss

That coincided with a moment of renewed relationships between the US and Latin America. Beginning with the Eisenhower administration, but mostly since Kennedy, with his Alianza por el Progreso, one of its objectives was the transference of new technologies towards Latin America. So the three things coincided: a new economic development model, the needs of the companies, and a new vision from the US towards Latin America. The three aspects came together and these businessmen gathered around ANDI (National Association of Colombian Businesspeople) and around one othervery important body in Colombia then, called INCOLDA (Instituto Colombiano de Administración), and succeeded in obtaining from the US Government, through what was known as ‘Chapter Four’ of the Alliance, teachers from Syracuse University. And with them, they started offering in Colombia the degree in business administration.

At the beginning, our initials were EAF, for Escuela de Administración y Finanzas. Professor. Hargadon still lives, he is like the father of modern accountancy in Colombia. [editor’s note: Bernard J Hargadon Jr. literally wrote the book on Accounting for Latin America: “Contabilidad de Costos” and began teaching accounting in Medellín within three months of EAF’s establishment] So, this school was founded in 1960 around those three, let’s say, pillars.

A few years later, the industry demand was for, let’s say, not only bachelor’s level administration, but also technicians and technologists for plant operations. So a parallel institute was created, called Instituto Tecnológico, that’s where we got our initials: Escuela de Administración y Finanzas e Instituto Tecnológico, to train technicians, then basically for the textiles industry. By 1970, the directors of the university saw that it was not then ideal to have professional studies alongside technical studies, and so the Instituto Tecnológico was suppressed. The IT disappeared and the directors made a jump to transform what was then a technical school into a university. The difference between a school and a university is that the school is directed towards only one specific area of knowledge, in this case business administration. On the other hand, a university has a vocation towards universality. So here, they decided to suppress the technical institute and to replace it with a new school of engineering.

“At this moment, we have 26 US teachers at EAFIT.”

Nevertheless, in those moments, the relationships between the US and Latin America were different, the interests were different. Today we look towards Europe, mostly Germans, who, via GTZ (known as GIZ since 2011), support development of the new engineering careers inside EAFIT. And then we created the engineering, production, process, mechanical, civil, systems, geology engineering, and lately design engineering programs. And now the university has moved even more towards universality, as we have been creating other schools: sciences, humanities, law, finance and economics and the last one is arts & sciences. That is the evolution of EAFIT, under a foundational principle we still abide by: professional practice. That is: the students from our university, before receiving their diploma, should have walked through the real world, through the world of enterprise.

Finance Colombia: Not only theory?

Dr. Mejia: Exactly. So that’s why all our careers have at least one semester in which the student, before receiving his or her degree, goes through the real world, the internship. Before that was only in private companies, but also nowadays in the public sector as well. It is something very interesting, how the concepts of administration, let’s say, designed for the private company, have permeated, and made an impact in the public sector. Here in Medellín for example, the mayor is an EAFIT graduate, the manager of EPM is an EAFIT graduate, the new director of the Medellin Metro is an EAFIT graduate. So what was once thought of as primarily for the private sector, also impacts the public sector these days. And I believe right here we have one of the keys to the new vision for the transformation of this city.

Finance Colombia: Which academic relationships does EAFIT have with other universities and institutions?

Dr. Mejia: Good question, because it brings up an interesting aspect. Look, unfortunately, the agenda between the US and Colombia, during the past few decades was focused on antinarcotics, at the expense of everything else. Nowadays the administrations, theirs [the US] as well as ours, are trying to restart those links. Because of this, we have recently had more relationships with European universities, than with US ones. After that initial stage, our relationships turned towards Europe, and nowadays we are also trying to reach Asia. We do not want to settle for any one model, but to have a variety. So, where do we stand now? Some historical relationships with Europe, basically France in mechanical and civil engineering; with the Dutch in design engineering.

EAFIT’s verdant campus on Medellin’s south side.

And we are trying to open relationships with the Asia-Pacific region. In our last strategic plan, we contemplated that this university could contribute to society by bringing this city and this society closer to Asia and the Pacific, and for that matter we have created a study center for Asia and the Pacific, and to try to get this society, which has always looked towards the Atlantic, to look also towards the Pacific. Even when Antioquia’s 21^st century vision was being discussed, when we said “Pacific” it referred to the two meanings of the word, not only “peaceful”, but also towards the Pacific Ocean. So today we have important relationships with Europe, with some Asian universities, and the academic relationships between US and Colombian universities are being rebuilt.

There is still a big obstacle: the travel advisories put out by the US State Department. As long as they remain, the relationships will be timid. But in the last few years we have seen a restart in our relationships with the US universities. The reluctance for some US academics to travel here because of the travel advisories is an obstacle which is still difficult to overcome. But we believe, with a peace treaty [with the FARC], that restriction will disappear. However, some important developments exist at this time. First, the interest expressed by some universities in the US towards Colombia; Purdue University, in Indiana, to start with.

With Purdue we have a magnificent relationship. And in their strategic plan, they have as an objective to contribute to the development of Colombia. For instance, with them we have installed the most powerful supercomputer in Colombia; we call it Apollo, in honor of Neil Armstrong, who was a Purdue graduate. That supercomputer has boosted research in Colombia in an exponential way, thanks to Purdue University.

We were the first university in Colombia to be part of President Obama’s new strategy of “100,000 Strong In The Americas,” to bring students from the US into Latin America. This semester we have the first 10 students. If we could get beyond those State Department Advisories, the relationships could be even more numerous. But I’m optimistic and the relationships with the US universities will continue to grow strongly in the upcoming years. Specifically we have been strengthening relationships in Indiana with Purdue, in Massachusetts with Brandeis University—we have a joint program with them; with FIU in Florida, with Tulane in New Orleans, with Carnegie Mellon; And slowly more relationships are being established. And also to bring teachers: At this moment, we have 26 US teachers at EAFIT. Not only in languages, but in other areas as well. And we have an increasing number of students studying doctorates in other universities. Yesterday I heard that a scholar, Luz María Martínez Sierra, from our physics engineering faculty, is in Pasadena, California, with NASA, on a project to send a satellite to Europa, one of the moons of Jupiter, in search of water.

Finance Colombia: Yes, I read about it in the newspaper.

Centro Argos, under construction earlier this year.

Dr. Mejia: I believe every day the exchange increases with universities, and we have students of ours who used to look only towards Europe. Now it all belongs to history, but there was a point when I said, “Only war correspondents or DEA agents come to Medellin!” during many years. Now that has all changed, and I believe that the academic exchange continues to increase.

Finance Colombia: One good thing about how things have changed is that now we have seen a demand for news from Colombia.

Dr. Mejia: Positive news.

Finance Colombia: Not only from North America, but also from Europe and Asia. If a German or a Chinese wants to investigate or research Colombia, if they don’t speak Spanish, they will look for information in English. There is so much investment and so much businesses happening here, it is the number three economy in Latin America, and number two has 120 million inhabitants, and number one has 175 million inhabitants. So with less than 50 million people, Colombia is already number three, and is still growing. There are so many positive things happening here.

Dr. Mejia: I’m confident we will have a peace treaty. It does not mean we will have absolute peace, or that all violence will stop, but I do think we will have a quite different process. Let’s go back to the beginning: I think that with everything that has happened, there is a silent revolution in the qualification of Colombian universities. It is my opinion, that in the last 15 years there is a group of Colombian universities that have understood their role in society and in globalization, and are making a really serious effort at renovating themselves and bringing in teachers, training them, and I think those universities are supporting the idea of a new Colombia.

Finance Colombia: Continuing with that line of thought, something positive I have seen here, is that many people, students I’ve met who are first in their families to attend a university. Which initiatives and programs does EAFIT have in social inclusion? So that it is not just the case of: “I go to EAFIT because my father went to EAFIT.”—What is the university doing to include everyone else in the community?

Dr. Mejia: You are referring to one of the most delicate topics, because, at least in this stage of Colombia’s development, a university education is still, will be for some time, the biggest single factor in social mobility. What you are speaking of, I believe has great importance, and Colombian society is not yet generally aware of it: The possibility of access to universities for first generation students.

I will tell you first about national strategies and then about local ones, and then about EAFIT’s. Nationaly: I believe the program “Ser Pilo Paga,” with the 10,000 scholarships, faces the right direction. Just what you said: Based on the studies we’ve done, 98% of those students are 1st generation university students. Those are 10,000 families who will be forever different.

“Because the social image in society has been that EAFIT is the university of the economic elite. The great transformation we have tried to accomplish within this administration is to become known more as the university of the academic elite.”

In Medellín, a project, one of the first of its kind, with an agreement between the EPM Foundation and the universities, has given scholarships to some 24,000 students with limited resources so far. Imagine what this city would be like if those 24.000 hadn’t had this chance and had just stayed on street corners instead?

Another factor is what we do here inside the university. I imagine that in this moment we have some 1,800 students on scholarships. We make an effort in various ways. For one, we have a very beautiful program. Almost all university workers, 92% of them, to the extent of their abilities, we contribute a portion of our monthly salary into a fund and we use that to give scholarships to the best students in low-resource schools; we bring them to EAFIT.

But we don’t just only pay for their tuition, but we give them support for meals, transportation, and academic materials. We give them a daily meal allowance of $6,650 pesos for food in the university cafeterias, we provide $67,000 pesos monthly for transportation, and we give them an amount for supplies. And they are some of the best students, because they are the ones who make the most out of the university. The ones involved in all the cultural and social activities, sports; and I believe that is the way we can provide equity, and we are very proud of that.

“Now our doctoral students will be there solving real problems, real industry challenges, and obviously financed by the industry itself.”

Because the social image in society has been that EAFIT is the university of the economic elite. The great transformation we have tried to accomplish within this administration is to become known more as the university of the academic elite.

Finance Colombia: How will EAFIT be different three years from now than it is today? What initiatives are you launching?

Dr. Mejia: Several strategies. Number one: languages. We believe one of the factors that impedes competitiveness in the city is the lack of foreign language skills. Next month we will start to build a big language center, in two areas, one here in the south at the university, we expect to teach some 20,000 students every year in languages.

Auditorium of the Centro Argos Para La Innovacion being built on EAFIT’s campus. (courtesy Grupo Argos)

Number two: in sciences. We have created the new science school; we believe the industry and the private sector should have a scientific and technological livelihood in accord with our times, so we will strengthen the area of science academics.

And number three, we promote, above all, the great relationship between the companies and the university. We are about to open the research center Centro Argos Para La Innovacion, financed mainly Grupo Argos, who is building the research center here inside the university. We are negotiating with another three or four companies for them to bring their research and development entities into the university as well.

So for instance, Grupo Argos is investing 17 million dollars in this new research center, because according to their vision, by the year 2020, they expect 25% of their revenues to be generated by products that do not yet exist. So this will be the womb from where the new products and technologies will emerge.

For us that is very important, because it allows us to acquire research resources which for us alone would be very costly. They might have an atomic scanning (electron) microscope, which by ourselves would take long time to acquire, but now our doctoral students will be there solving real problems, real industry challenges, and obviously financed by the industry itself.

So that’s the third aspect, Loren. A great relationship with a great group of companies who have realized that without innovation their companies would be at risk in the future. So that’s what we go for: a great relationship between the university and the private sector.