Strategic intelligence in Latin America


Agriculture and fintech boom but infrastructure and renewables require investment.

As the sun sets on 2020, Colombia seeks an economic reactivation in 2021, built around infrastructure and renewables investments, after extensive lockdowns and severe restrictions, which exposed a weak healthcare system and a large informal economy that couldn’t afford to stop going to work. Equally important, Fintech and agriculture are booming but high taxes and bureaucracy are holding back other sectors of the economy. Looking further ahead, elections are coming in 2022 and a shift to the left may be on the cards.


2021 is a pre-electoral year in Colombia and the political machinery will start moving soon. Some analysts are forecasting the country to lurch to the left after the elections although it is still too early to identify the leading candidates.

In recent years Colombia has been seen as “pro-market”, entry to the OECD has generated confidence and the peace agreement with the FARC has created greater stability for investment. However, a leftist President may introduce uncertainty and negatively affect the investment environment.

“We are already starting to take into account the effects that the next presidential elections are going to have and the conditions of the current Colombian market.”

Executive in the financial sector, Colombia


The economic landscape is challenging. The stock market has contracted this year and there are fewer companies going public. Tourism was boosting the economy but that has been badly affected by the COVID-19 pandemic. The informal economy is very large. Taxes are high in comparison with comparable countries. Bureaucracy is a problem and sometimes makes it difficult to do business in the country.

There are other concerns on the agenda for the coming year(s). There is possible Tax Reform, lower interest rates (Banco de la República and Commercial Banking), worsening exchange rates, and a potential rise in country’s risk rating.

Despite this, there are clear opportunities in the country.

“On the one hand, there are opportunities to invest in short-cycle businesses which project growth in 2021 such as the agricultural and logistics sectors. On the other hand, there are sectors that offer good returns and long-term diversification: Infrastructure, Fintech and Renewable Energy.”

Portfolio manager, Colombia


The government has indicated that part of the economic reactivation after COVID-19 will depend on the investment made in infrastructure. 12 concessions have been identified for the first phase of the 5G Project (6 highways, 3 airports, 2 river initiatives and 1 commuter train), for an approximate value of USD 519 million. For these, a total investment of more than USD 5.4 billion is needed, and the government needs partners.

Among the first phase of 5G projects, the specifications of the road projects will be ready first and then the river, rail and airport projects. These projects are: Cali-Palmira Access Project / Valle del Cauca Road Mesh (specifications published in September 2020), La Troncal del Magdalena, North Access Phase 2 – Bogotá, Second Road in Carrera 7ª Bogotá, Alo Sur, Buga-Loboguerrero-Buenaventura road project, Magdalena River APP, Canal del Dique, Cartagena airport expansion, Suroccidente Airport (Neiva), Palmira airport expansion and Train La Dorada-Chiriguaná.

The second wave of 5G projects is estimated at USD 880 million over 10 projects, which the government plans to award before August 2022. Some of these will be: El Santuario-Caño Alegre dual carriageway, Completion Route of the Sun 1, Complete Bogotá-Medellín dual carriageway, Bogota airport system, Zipaquirá-Barbosa-Bucaramanga highway and Pasto-Popayán highway.

It is important to note that Colombia has one of the most congested transport systems in the region. It does not have a national rail or river system (there are only three sections of railway concessions), which has contributed to the fact that more than 70% of cargo transport is done by road, using roads that are generally in poor condition.


Although the governments’ commitment, due to a need for cash flow, has always been oil and its derivatives, the issue of renewable energy has begun to permeate the political agenda, since it is understood that diversifying energy generation will guarantee the sustainability of the market.

Attracting new investment in energy generation and associated issues, even more so after the effects of COVID-19, is a priority for the government. In the country today there are more than 290 clean energy projects, led by solar, wind and hydroelectric, followed by geothermal and biomass projects.

Colombia, due to its geographical position, has constant solar radiation throughout the year. Solar parks are mainly in the eastern Llanos, La Guajira, Atlántico and Valle del Cauca. The country also has great availability and good quality of the wind resource for wind projects, especially in La Guajira. Finally, there is also an abundance of water suitable for hydroelectric projects in almost any area of ​​the country.

In 2019, investment in renewable energy projects was more than USD 500 million and today there are 14 new projects that total more than USD 204 million of investment.

There are several foreign companies that are already investing or plan to do so in the short term, such as the French company GreenYellow, Entorias Energy of Singapore, Enel Green Power, Trina Solar, EDP Renováveis, Nordes, among others.


Accelerated by the COVID-19 pandemic, financial technology companies (Fintech) have been growing rapidly in Colombia, offering high returns with low-moderate risks. There is a great variety of investment opportunities including payments and remittances, loans, business finance management, credit checks, identity and fraud, crowdfunding and insurance. All market niches that traditional banking has historically not covered.

There are more than 120 Fintech companies in Colombia and combined they have raised capital of more than USD 284 million. Some stand-out companies include ADDI, Avista, Sempli, Mercado Pago, Panacash, Creditop, AM Capital, and many others.


In Colombia, a good investment option is everything related to buying, transforming and exporting agricultural products. The sector has been robust throughout the COVID-19 pandemic and in general domestic supply was not affected.

Colombia can produce many agricultural products all year round and there is a sufficient supply but there is no vertically integrated agricultural company. The sector is ripe for investment, especially in transformation and production centres (for example, for products such as cocoa, coffee and sugar).

Finally, a Tax Reform is foreseen in 2021, however, historically the agrarian issue is not included in this type of reforms, therefore there would be more stability for the sector. Additionally, in the middle of this year, the government issued Decree 849 by means of which tax benefits are established for investments in the agricultural sector.

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