Foreign investment in Colombia - Ana Zuluaga

COLOMBIA’S PEACE BUILDING PROCESS: THE ENTREPRENEURS PERSPECTIVE AND FOREIGN INVESTMENT By: Ana Ramirez Zuluaga

After 52 years of armed conflict between the FARC guerrilla and the Colombian government, and six years of negotiations in Havana, Cuba, Colombians are finally ready to decide on whether they approve of the peace agreements or not that the twotime-elected President, Juan Manuel Santos, and the Secretariat of the rebel group signed on September 26th in Cartagena, Colombia.

Colombian entrepreneurs believe that being able to achieve peace with FARC will bring economic benefits to the country; but according to the survey conducted by the Chamber of Commerce in Bogota together with the Ideas for Peace Foundation and International Catalan Institute, only 55% of the entrepreneurs support the peace dialogue. This is not an ideal situation due to the fact that the support and contributions of the economic unions are considered paramount for the success of the post-conflict process that is about to take place in the country. They [entrepreneurs] would be able to provide jobs for those who are willing to drastically change their lives and lay down their arms. Of the total number of entrepreneurs interviewed, 53% stated that they would be willing to hire a demobilized guerilla member, while the other 31% showed skepticism at the idea.

Despite the ongoing skepticism from the entrepreneurs, 85% of Bogotá’s businessmen agreed to the fact that achieving peace with FARC will increase foreign investment, due to the fall in number of both, extortion and terrorist attacks associated with the terrorist group (it is important to keep in mind that negociations between the government and the ELN guerilla are on their second phase now) and 72% of them agreed that it will lead to an acceleration of Colombia’s economic growth and reduce poverty levels with the end resulting in improved income distribution.

Even though the entrepreneurs expressed optimism over the economic benefits that the implementation of the agreements would bring with them, they also acknowledged,

criminal behaviors such as drug smuggling and corruption would not dissapear any time soon.

To fully comprehend Colombia’s economic future landscape, it is important to understand two key aspects; one, there are more challenges – apart from its internal conflict with FARC- that Colombia is facing right now; the global macroeconomic situation (rising US dollar, the dreadful political and economic situation in Venezuela and the reduced commodity prices, among others) have placed downward pressure on the value of Colombia’s currency, which is currently among the weakest in the world in recent years. Two, apart from the challenges facing Colombia at the moment, its growth levels still remain one of the highest in the region, “with GDP targets for the close of 2015 still pushing 3 percent, compared with less than 1 percent for Latin America as a whole” (Forbes, 2015), and the peace deal with FARC could improve economic growth by at least 1.5 percent, according to President Santos.

It is safe to say that Colombia still has a long way to go regarding its economic future, but the fact that its history will drastically change, and the half -century long internal conflcit with FARC will end, is definitely a sign of positive change, and the begining of many more to come.

Sources: El Espectador, Paz traerá mayor inversión extranjera: empresarios.

Forbes, What should investors know about Colombia’s Peace Building Process?