Abstract
Colombia’s government has announced a massive infrastructure investment
programme for 2009, which
should held drive the construction sector
forward in the coming years, and shelter it from some of the
worst effects
of the global economic downturn. However, much of the investment relies on
private
capital, which could be difficult to come by in today’s
tightened financial climate. Despite this, BMI
forecasts that the
construction industry value will reach US$19.57bn by 2013.
For the
transport sector, road and rail projects will take precedence. In October
2008, Colombia
announced plans to construct a 1,800km highway connecting
its Pacific coastal region with Venezuela by
2012. The project is expected
to connect Colombia' s most important Pacific port, Buenaventura, with
economic centres – Valle Cauca and the ' coffee growers axis' – and
its second-largest trading partner,
Venezuela.
Meanwhile, in the power
sector, the government intends to invest US$5.4bn in water and sanitation
supplies (WSS) over a four-year period from 2011 to 2015, according to
Business News Americas
(BNamericas), which quotes an official from
Colombia' s national planning department. Colombia has
improved its WSS
supplies over the previous decade; however, more work is needed to bring it up
to
standard. BMI currently ranks Colombia 75th out of 164 countries in
terms of its physical infrastructure.
However BMI' s country risk analysts
recently downgraded Colombia' s real GDP growth forecasts for
2009 and 2010
to 2.1% and 3.9% (from 2.9% and 4.5%) respectively. The global economic
downturn has
resulted in both declining retail sales and slowing
industrial growth in Colombia. This could severely
hamper private
investment plans in infrastructure. Meanwhile, rebel activity disrupted oil
pipelines in
Colombia in June 2008, suggesting security remains a problem
in the country.
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