Colombia’s Uncertainty Is Sinking Investment and More

By Luis Fernando Mejía

Economic and political instability could spell trouble for growth. However, the government has a new chance to put the country back on track.

BOGOTÁ—Colombia’s GDP growth plummeted last year, falling to just 0.6% from 7.3% in 2022. This rapid decline in economic expansion was largely expected, but the extent of the country’s fixed investment contraction was surprising, declining to the lowest level since 2005. Nineteen years later, with an embattled government, Colombians are hoping for a return of high growth and lower unemployment. Will they get it Rising interest rates and a corporate tax rate among the world's highest help explain the massive drop in fixed investment—a 9% decline in real terms to represent only...

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