Thanks to the FTAs, we have gone from exporting almost non-existent amounts to millions of dollars in products from different sectors that were not previously contemplated.”
Maria Claudia Lacouture, director of Amcham Colombia
The countries with which Colombia has Free Trade Agreements (FTA) are those that consolidate the greatest commercial dynamics of the country today. According to a report from the Ministry of Commerce, based on data from the National Administrative Department of Statistics (Dane), last year FTAs represented 65% of the country’s exports and 60.4% of imports.
Colombia has signed 13 FTAs with countries including Canada, Chile, South Korea, Costa Rica, the United States, Israel, Mexico, and Venezuela. And, likewise, it has others with groups such as the European Union, the Northern Triangle (El Salvador, Guatemala and Honduras) and the European Free Trade Association (Efta).
Meanwhile, there are four so-called partial scope agreements: Caribbean Community (Caricom), Panama, Cuba and the Pacific Alliance. That is, when adding the two categories, there are 17 agreements.
“Thanks to the FTA we have gone from exporting almost non-existent amounts to millions of dollars in products from different sectors that were not previously considered. According to information from the US Census Bureau, new rubber tires stand out from those used in buses or trucks; paper and cardboard; smart cards and aluminum barrels,” said María Claudia Lacouture, director of the United States Chamber of Commerce, AmCham Colombia.
With a participation of 26.5% last year, and even reaching 29.2% in 2019, the United States is, among the countries with which Colombia has an FTA, the most dynamic. Although if it is joined with that of the European Union, they gather 37.2% of the total.
Jorge Tovar, associate professor at the Faculty of Economics of the Universidad de los Andes, states that the structural problem of the external sector is the low diversity of its exports. “Colombia’s situation is paradoxical because its main export product is oil, but we are a small player on the international stage. Diversifying exports is a necessity”.
A report from the Ministry of Commerce last year indicates that when looking at trade flows with countries with trade agreements, a more dynamic behavior is seen than that of total trade.
“Between 2005 and 2020, exports to countries with a trade agreement grew at an average annual rate of 9.9% in value and 17% in volume, while imports grew at 10.5% in value and 11.1% in volume. Trade shows a correlation coefficient of 95.8 percent.”