Foreign direct investment in Colombia came to $6.7 billion in the first nine months of 2010, the country’s Central Bank announced Wednesday.
In 2009, Colombia received a total of $6.9 billion in foreign investment, which the bank expects to be exceeded by the end of October.
According to the Central Bank, most of the foreign money is invested in the country’s mining and oil sector, which received $5.6 billion.
Newspaper El Espectador reported that analysts and some of the Central Bank board members are worried the large investments in the fossil fuel sectors could cause the so-called Dutch Disease, as the export of natural resources causes the currency to appreciate and damages the export of other products like coffee and flowers, and the tourism sector.
Central Bank board member Carlos Gustavo Cano admitted to the newspaper that the appreciation of the peso, which gained 11.8% against the dollar this year, is largely due to the increased export of oil.
To curb the appreciation of the country’s currency, the Central Bank is buying $20 million a day and the government has announced tax relief for troubled export industries.