GDP in Colombia

Colombia GDP | Economic News & Forecasts

Colombia - GDP

Economy gains some momentum in Q4 but growth remains subdued

Q4 GDP figures confirmed that the Colombian economy continues to struggle with low oil prices two years after they first started to fall. While GDP grew 1.6% year-on-year in Q4, which was above market expectations of a 1.5% reading and Q3’s 1.2% growth, overall GDP growth for 2016 totaled 2.0%—the slowest rate since 2009. Despite the seemingly poor result, Colombia’s economy fared better in 2016 compared to other commodity-dependent economies in the region, thanks largely to the country’s resilient total consumption and a weaker peso which fueled net exports.

The fourth quarter’s mild acceleration was mainly driven by private consumption—which accounts for around 60% of GDP— while falling fixed investment kept a lid on growth. Private consumption growth quickened to 2.0% in Q4 from 1.3% in Q3; possibly a reflection of consumers’ anticipation of the upcoming VAT hike. Therefore, this improvement in private consumption could be short-lived. In addition, government consumption remained subdued in Q4 at Q3’s 0.2% growth, which was the lowest reading in over a decade. Although fixed investment continued to drag on growth, it improved markedly in Q4 as it reached the highest figure in four quarters (Q4: -2.9% yoy, Q3: -3.5% yoy).

Taking a look at the external side of the economy, exports of goods and services worsened from Q3’s 2.8% contraction to a 3.2% fall in Q4. While imports also declined in Q4, they did so at a much slower rate compared to the previous quarter (Q4: -4.2% yoy, Q3: -11.1% yoy), thus the external sector’s contribution to growth was fairly limited.

In seasonally-adjusted terms, the economy expanded 1.0% over the previous quarter in Q4, which was above Q3’s flat reading.

Colombia’s economy should see a mild pickup this year as the country gradually recovers from the shocks that affected growth in 2016, such as low oil prices, a prolonged drought and disruptive truckers’ strike. Furthermore, fixed investment is now expected to contribute to growth, as spending on the country’s ambitious 4G infrastructure program should pick up this year.

Against this backdrop, Panelists participating in the LatinFocus Consensus Forecast project that GDP will expand 2.4% in 2017, which is unchanged from last month’s forecast. In 2018, panelists expect GDP to grow 3.1%.

Colombia - GDP Data

2011  2012  2013  2014  2015  
Economic Growth (GDP, annual variation in %)6.6  4.0  4.9  4.4  3.1  

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Colombia GDP Chart

Colombia GDP
Note: Annual variation of gross domestic product (GDP) in %.
Source: Statistical Institute (DANE).

Colombia Facts

Bond Yield6.370.79 %May 24
Exchange Rate2,907-0.01 %May 24
Stock Market10,7580.01 %May 24

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