Colombia’s hotel sector expects to invest $1.2 billion this year, 33% more than the $900 million invested last year.
The sector decided to invest this amount because of government promises that hotels built after 2003 will receive tax benefits for 30 years, while hotels that invest in the upgrading of their establishment will be allowed tax breaks for fifteen years.
Jaime Alberto Cabal, president of hotel association Cotelco, called on entrepreneurs in the sector to invest in areas where the infrastructure is not yet up to scratch.
“It doesn’t make sense constructing hotels in areas like Medellin because they are saturated. This investments should be destined for the Atlantic and Pacific coast, between Cartagena and Barranquilla, the Gulf of Morrosquillo and La Guajira, where there are no important complexes,” economic newspaper La Republica quoted the businessman as saying.
According to Cotelco, the high number of hotels in the country’s three biggest cities Bogota, Medellin, and Cali are threatening the viability of the sector in these cities.
Avia Hotels president Rafael Obando disagrees with this and claims that the investment in the capital cities allows the implementation of new technology and design and increases competition in the tourist hotspots, which would benefit visitors.
However, the Avia hotel chain agrees that the most promising investment climate lies in areas where there are possibilities for ecotourism like La Guajira. “At the end of this year, once we obtain the licenses needed for this type of project, we plan an alliance with the indigenous communities to develop a series of activities involving them with the tourist attractions within the hotel, with labor and providing services and thus generating employment in the region,” Obando said.
In 2011, the hotel sector plans to invest another $1.5 billion.