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Colombia is Latin America’s 4th largest economy and 2nd most biodiverse country in the world. It has abundant natural resources including oil, coal, coffee, flowers, gold, emerald, nickel, silver, sugarcane etc. Agriculture (6.3% of GDP) is diversified and a large employer. The economy also has a sizeable industrial sector (about 27% of GDP) with strong manufacturing activities in textile, food products, automobile assembly, cement production, refined petroleum and chemical products. In 2019, Colombia gained admission to the OECD (formalized in 2020), a testimony to its efforts towards structural reforms in recent years.

Over the past decade, Colombia’s macroeconomic performance has been one of the strongest in Latin America. Growth has averaged 3.3% over the period and inflation has largely been under control. Economic performance however remains strongly tied to commodity prices as evidenced by the country’s severe macroeconomic adjustment in 2014-15 following the crash in oil prices. While fiscal accounts have gradually become less dependent on oil revenues, external accounts have continued to rely a lot on hydrocarbons:  oil and coal products still make up about 50% of exports, and direct investment is also highly concentrated in extractive industries. Exposure to the United States (Colombia’s largest trading partner) and episodes of large capital outflows also constitute sources of vulnerability in the economy.