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Investment Incentives in Colombia

The Colombian government has introduced a number of investment incentives over the last few years designed to promote and attract foreign investment, buttress employment, and increase economic development.

In the 2010 “Doing Business Report,” the World Bank ranked Colombia as the most business-friendly country in Latin America.

• Permanent Free Trade Zones: Colombia has the most competitive Free Trade Zone policy in Latin America: A single 15% total income tax rate. This allows for competitive business opportunities in the local market.
• Single Enterprise Free Trade Zones: This type of Free Trade Zone allows companies to establish themselves anywhere in the country.
• Other Incentives: The Colombian government has created various investment incentives like income tax exemptions for the following industrial sectors:
  • Investment in Hotel Infrastructure and Ecotourism Services
  • Investment in Late Yield Crops
  • Investment in Medical and Software products
  • Investment in Aeolic, Biomass and Agricultural Energy and Power Generation
  • Investment in Publishing Companies
• Special Import - Export System for Services: "Plan Vallejo": This import-export system allows service-exporting companies to import capital goods with tariff and sales tax (VAT) exemptions.

Learn about the average cost of establishing your company at a Permanent Free Trade Zone in Colombia.

Investment oportunities

The Ministry of Commerce, Industry and Tourism has developed the Productive Transformation Program, a nationwide policy based on two strategies: greater quantity and better quality delivered in products and services, and, the development of new and emerging industry sectors. These industry sectors were chosen to achieve sustained growth in both the economy and employment rates.

With the aid of the private industry, some industrial sectors were identified as offering unique business opportunities for foreign investors. The Colombian Government will decidedly support the development of these key sectors.

 Biofuels

• Income tax exemption for ten years.
• 6.5 million hectares (16.1 million acres) suitable for biofuel production.
• World’s fifth largest palm oil producer.
• Productivity of 9,000 liters of ethanol per hectare every year.
• Growing market. By 2020, a production of 1.4 billion liters of ethanol and 1.2 billion liters of biodiesel per year.
• Assured demand. In 2020, E20 and B20.
• Creation of a “green seal” to identify the national biofuel production with good environmental and social practices.

Cosmetics

• Market of USD 2.6 million and production of USD 2.4 million.
• Cosmetics exports grew by 23% between 2003 and 2007.
• Country with the second largest flora biodiversity in Latin America.
• Market for men’s cosmetics is expected to grow 20% per year.
• Colombian women cosmetics pocket share duplicates the European average spending.
• More than 242,000 professionals and technicians available to work in the cosmetic industry.
• Manufactured products based on natural ingredients grew 9% between 2003 and 2008.

IT Services

• Over 27,000 IT graduates and 13,000 engineering graduates per year.
• Seven cities with population over 500,000.
• Neutral Spanish-speaking accent.
• Market: USD 1 billion, growing at a rate of 42% for the past three years.

Tourism

• 2.1 million foreign travellers visited Colombia in 2011.
• International tourism annual growth in Colombia (9.73%) more than doubled the worldwide growth (2%).
• Income tax exemption for new or remodeled hotels.

Medical and Health Tourism

• Pioneer Program in reproduction immunology; the first invitro fertilization baby born in Latin America; first pacemaker debveloped in the world.
• Colombia is the second best country for scientific and health infrastructure in Latin America: (IMD, 2008).
• 3,000 physicians and health professionals graduate from college each year.

Colombia's key statistics

Source: National Statistics Administrative Department (DANE), Latinfocus, Economist Intelligence Unit GDP at current prices of 2000. * Forecast: Economist Intelligence Unit (EIU)

World class services for investors

The Colombian Government creates favorable conditions and offers the best advice for foreign investors. Proexport Colombia ranks 16 in the list of the best investment promotion agencies of the world and provides the following services to foreign investors:

• Information requests (economic, sector specific information, legal, procedural, etc).
• Key contacts with public and private sectors.
• Agenda preparation when foreign investors decide to visit Colombia.
• Aftercare services for investors that are already established in the country.
• Assessment and improvement of business climate.

Download information on foreign investment incentives:

Incentives for investors in Colombia (December 2010)  314 Kb