ColombiaLand of Opportunities Ministry of Foreign Affairs

ColombiaWith coastlines on both the Pacific and Atlantic oceans, Colombia is an important platform for the region

46,827,383

Main Cities

Source: Governmet of Colombia

Colombiaon the road to the OECD

Source: OECD Colombia – Economic Assessment, September 2010

Source: Rating Agencies, Proexport Colombia

Colombia recovered the investment grade status

in 2011

Source: Top Reformers Report, World Bank

Business Climate

• Colombia ranks 4th in the ease of doing business in Latin America.

• Colombia ranks 1st in protecting investors in Latin America and 6th in the world.

17,709

11,87510,792

9,162

3,830

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

20,000

Russia Brazil Colombia China IndiaSource: World Economic Outlook (International Monetary Fund)

EconomyColombia Vs. BRIC: GDP per capita PPP – 2012 (current international USD)

CIVETS+, an opportunity for diversification

HSBC CEO Michael Geoghegan: "Each has a very bright future“; "Each has large, young, growing population. Each has

a diverse and dynamic economy.”

“The CIVETS economies are emerging  as attractive destinations for investors and

they will report an increase in Gross Domestic Product (GDP) of 4.5% in the

next 20 years. Even above the estimates growth for the G7 countries, that would be

1.8%”

May 24th, 2010

Colombia, Indonesia, Vietnam, Egypt, Turkey, South Africa will take over as the new BRICs (Brazil, Russia,

India and China).+ are Azerbaijan and Kazakhstan

4.0

0.9-0.6

3.0

-6

-4

-2

0

2

4

6

8

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012Colombia Germany

Euro area Latin America and the Caribbean

Source: IMF

GDP (YoY, %)

Colombia has grown at an average of 4.7% during the

past decade, despite the international financial crisis.

Colombia has achieved an inclusive development during the past decade

5048 47

4542

4037

34

1816 15 14 16

14 12 1110

15

20

25

30

35

40

45

50

2002 2003 2004 2005 2008 2009 2010 2011

Poverty (%) Extreme poverty (%)

Incidence of Poverty and Extreme Poverty (%)

8

9

10

11

12

13

14

15

16

17

18

Aug

01Fe

b 02

Aug

02Fe

b 03

Aug

03Fe

b 04

Aug

04Fe

b 05

Aug

05Fe

b 06

Aug

06Fe

b 07

Aug

07Fe

b 08

Aug

08Fe

b 09

Aug

09Fe

b 10

Aug

10Fe

b 11

Aug

11Fe

b 12

Aug

12Fe

b 13

Unemployment Rate (%)

Source: DANE

Five Engines of Economic Growth

Infrastructure

Innovation Housing Agriculture Mining and Energy

Increase the railway system from 906 to 2,000 km, highways from 1,050 to 2,000 km, and the number of bridges on the primary road network from 1 to 27.

Maximize the potential of Colombia‘s human capital and align the productive and academic sectors.

Build 1 million houses during this four-year term.

Increase agricultural production by 33.9% between 2014 and 2019.

One of the strongest growth sectors over the past decade.

Source: Ministry of Foreign Affairs

Financial services

19%Social

services15%

Industry12%

Commerce11%

Mining11%

Construction8%

Agriculture6%

Transport6%

Utilities3%

Taxes9%

61%

17%23%

18% 19%

0.0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

HouseholdConsumption

GovernmentSpending

PrivateInvestment

Exports Imports

Composition of the Economy by Supply and Demand

Source: DANE

According to World Energy Council data, Colombia has the highest energy stability of the group of countries with a GNP per capita between USD$6.000 and USD$14.000.

Energy

Colombia has a high capacity for exporting energy.

Hidraulic80%

Cogenerator1%

Thermal13%

Other6%

Source: XM

Distribution of power generation in Germany (% of GDP)

Fiscal Policy

Source: Ministry of Finance, Central Bank

36

42

48 4743 42

3936 36 37 38

35 33

05

101520253035404550

Internal public debt External public debt

-5.0-5.5 -5.7

-4.7 -4.9

-4.3

-3.7

-3.0-2.6

-4.3-3.9

-2.9-2.3 -2.2 -2.1

-6

-5

-4

-3

-2

-1

0

Gross Public Debt (% of GDP)

Fiscal Balance(% of GDP)

*: forecasts.

Monetary Policy

Source: Central Bank

(%)

1.91

2.78

3.25

2.50

3.50

4.50

5.50

6.50

7.50

8.50

9.50

10.50

1

2

3

4

5

6

7

8

Jan

07

Mai

07

Sep

07

Jan

08

Mai

08

Sep

08

Jan

09

Mai

09

Sep

09

Jan

10

Mai

10

Sep

10

Jan

11

Mai

11

Sep

11

Jan

12

Mai

12

Sep

12

Jan

13Inflation Core inflation Policy Interest Rate (right axis)

Source: destatis

International Trade

60,20855,207

5,001

0

10000

20000

30000

40000

50000

60000

70000

Exports Imports Trade balance

Colombia‘s Trade Balance (USD Million FOB)

Source: DANE

1,385

1,644

-259-500

0

500

1000

1500

2000

Exports Imports Trade balance

Colombia‘s Trade Balance with Germany (EUR Million)

Free Trade Agreements (FTAs)

Reasons to Invest in ColombiaTax benefits

Colombia has some of the most competitive Free Trade Zones of Latin America, with incentives such as:• Income tax of 15%.• No cause or custom taxes (VAT, tariffs).• The benefits of international trade agreements and the

possibility of local market share.

A government committed to R+D+i: • Wage and training incentives and tax deduction of up to

175% of the investment for companies performing R & D projects.

• Revenue generated from innovative projects generate tax deductions and equipment imported for these activities is exempt from VAT.

Colombia has always had a close business relationship with Germany

Pacific AllianceChile-Colombia-Mexico-Peru

“Pacific Alliance is the most important integration process in Latin America”

Juan Manuel Santos, Jun 6th 2012

• Population - over 200 million

• Together, the countries of the Pacific Alliance would be the 9th largest economy in the world

• 35% of Latin America’s total GDP: 1.7 billon dollars

• Accounts for half of all foreign trade in the region: US$438 billion in exports and US$418 billion in imports

• Exports are almost 60% larger than Mercosur countries

• US$55 billion in FDI

• US$71 billion in exports to Asia

• MILA: integration of stock-markets

Colombia Full of wonders and

diversity