Colombian mines and oil exploitation gets 85.6% of foreign investment in the country, while foreign money flees from other sectors of the economy.
According to economic newspaper Portafolio, foreign investment in mining and oil explotaition in Colombia increased 16.4% so far in 2009, compared to the same period in 2008. Foreign investment in other sectors of the Colombian economy has decreased, from being 35.4% of the total foreign investment in Colombia in 2007, to be only 13% in September 2009.
The total of foreign investment dropped from US$5.41 billion in the first half of 2008 to US$4.89 in the same period this year.
“Although it is not ideal, the (foreign) investment in the hydrocarbon sector is welcomed in Colombia” as foreign investment fell 44% worldwide this year, Colombia minister of foreign trade, Luis Guillermo Plata, said.
“We are turning into a miner country. If there is not a balanced macro-economic management it may de-industrialize and harm the rest of the economy” Salomon Kalmanovitz, dean of economy at Jorge tadeo Lozano University in Bogota, warns of the massive foreign invesment in hydrocarbons.
Alejandro Gaviria, dean of economy of Xavier University in Bogota, thinks that tax stimulus made possible the increase of foreign investment in mining and petroleum exploitation, to the detriment of other economic sectors.
“The tax structure and the incentives are attractive for the hydrocarbons, not so for other (sectors),” said Gaviria.
According to Portafolio the price of petroleum has played a key role in the destination of foreign money in Colombia. In 2008 it reached US $ 145 a barrel. It was US$ 33 in December 2008, while since June 2009 the price of petroleum has revolved around US$ 70 a barrel.