Colombia: GDP expands at fastest pace since Q4 2006
December 22, 2011
In the third quarter, GDP added 7.7% over the same quarter last year, which represented an acceleration over the 5.1% expansion observed in the second quarter (previously reported: +5.2% year-on-year) and also defied market expectations that had GDP expanding 6.0%. The third quarter acceleration was primarily driven by an improving external sector, although domestic demand also remained resilient (Q2: +9.3% yoy; Q3: +9.4% yoy). Private consumption, which accounts for about two thirds of total GDP, grew 7.3% above the same quarter last year (Q2: +6.6% yoy), while government spending rose a more moderate 3.2% (Q2: +2.2% yoy). In addition, gross fixed investment accelerated from a 14.1% increase in the second quarter to a 20.1% expansion in the third. Meanwhile, the external sector improved over the previous quarter, as exports jumped from an 8.1% increase in the second quarter to a 10.5% expansion in the third, while imports moderated (Q2: +24.9% yoy, Q3: +18.8 yoy). As a result, the external sector's overall contribution stepped up from minus 4.6 percentage points in the second quarter to minus 3.0 percentage points in the third. At the sector level, services expanded 6.0% in the third quarter, overshooting the 5.5% increase seen in the second quarter. Industry jumped 10.6% (Q2: +2.9% yoy), while agriculture increased 3.8% (Q2: +1.6% yoy). A quarter-on-quarter comparison corroborates the strong growth seen in the annual data, as the economy added 1.7% over the previous quarter (Q2: +1.8% qoq). In 2012, the Central Bank sees GDP expanding between 4.0% and 6.0%. In 2011, the monetary authority expects GDP to have grown between 5.0% and 6.0%.