INVESTMENT IN BUILDING MATERIALS

Libertad y Orden

CONSTRUCTIONONE OF THE MOST DYNAMIC INDUSTRIES

CONSTRUCTION GDP IN LATIN AMERICAUSD THOUSAND OF MILLION

130.3

153.8

92.5

127.5

35.4

52.1

33.7

9.9

27.433.9

2014

2020

19.830.2

13.1 18.210.7 16.5

3.0 3.5

Brazil Mexico Colombia Venezuela Argentina Chile Peru Ecuador Panama

largest in Latin America after Brazil and Mexico.

Source: Business Monitor

According to Business Monitor, between 2015 and 2020 the value of the construction industry will almost double to US $ 52 billion (compound annual growth rate of 12%).

average in Latin America. It is estimated that by 2020 the per capita cement consump-tion in Colombia will reach 329 kg and Latin America to 389 kg. (Business Monitor)

segment has been marked by Government policies that have the goal of constructing

through road concession programs (4G), within which it is expected to build about 7,000 kilometers of roads.

In the last 5 years, the construction sector grew by an average of 8%, becoming one of the main sectors that drive the growth in the country.

According to Asogravas, it is estimated that all 4G infrastructure projects will require 74 million tons additional of aggregates (sand, gravel, stone, etc.).

DYNAMICS OF THE CONSTRUCTION INDUSTRY IN COLOMBIA

CONSUMPTION OF BUILDING MATERIALS (MILLIONS USD)

THE COUNTRY MAINTAINS A CONSTANT DEMAND FOR BUILDING MATERIALS

PROJECTED GROWTH OF THE CONSTRUCTION INDUSTRYIN COLOMBIA (USD MILLIONS)

30.120 30.320 34.790

Source: Business Monitor

Source: DANE - National Accounts, Annual Manufacturing Survey.e= estimates based on CAMACOL

39.66045.780

52.060

In 2013, demand for materials by the construction sector was US $ 31 billion, registering an upward trend between 2009 and 2013 with an 8% compound growth.

and services necessary for the development

concentrated in 3 groups:

Non-metallic mineral products: glassware, not structural ceramics, brick, cement, plaster, concrete products, marble, and cobblestones.

Basic metal products: rolled products of iron or steel, and structural metal products.

Non-metallic minerals: materials used in construction as common stone, marble, granite, river sand and gravel.

Estimates of consumption of building materials in the coming years are positive, with growth projections of 7.7% for the consumption of cement, concrete and clay products; 4.5% for non-metallic minerals and 4.2% for metal products for structural use.

Articles of concrete, cement and plaster

Cement. lime and plaster

Metal products for structural use

Non-metallic minerals

Clay minerals PVC pipe

3.568

5.170

4.0

90

5.8

68

1.666

2.0

47

1.857

2.3

14

1.237

1.793

279

308

2013

2015e

2018e

ALUMINUM PRODUCTS, CERAMIC AND PORCELAIN ARE THE MAIN EXPORT PRODUCTS

EXPORTS OF BUILDING MATERIALSUSD MILLION

COLOMBIA AS AN EXPORT PLATFORM

With more than 13 trade agreements in force, Colombia has preferential access to close to 1.5 billion consumers in markets such as the United States, the European Union,

addition to its privileged geographic location, makes the country an ideal export platform for the region.

In 2015, exports of building materials were US $ 475 million.

7 products account for 60% of exports of building materials, highlighting the aluminum doors and windows and ceramic and porcelain products.

Due to the free trade agreements signed by Colombia, the

building material products exported.

Colombia also enjoys a strategic location both by sea and air, making it ideal for projects that seek access to a wider market in the Americas.

Source:DANE

In 2015, �ve countries account for over 70% of exports: United States, Panama, Venezuela, Peru and Ecuador. Exports of building materials to the United States grew 32%.

2010

436506

589

496 469

2011 2012 2013 2014

475

2015

OTHER FACTORS TOINVEST IN THE SECTOR

Incentives such as Free Trade Zones, a Stimulus Plan for productivity and employment, and incentives for job creation that reduce production costs for companies present in Colombia and that serve the domestic market and export from Colombia.

will increase the demand for building materials.

households, which translates into a higher demand for houses.

Wages in the industrial sector in Colombia are the second lowest in Latin America (IMD World Competitiveness Yearbook, 2015). Wages are 24% lower than the Latin American average and 71% lower than those on the continent.

Colombia has more than 192,000 graduates in areas related to the sector, such as mechanical engineering, mining engineering, civil and industrial engineering, and architecture.

$

LARGE FOREIGN COMPANIES HAVE CHOSEN COLOMBIA AS A PLACE TO INVEST

SAINT GOBAIN, (FRANCE): investment amounted to USD 200 and will generate approximately

of glass for supplying the national market and exporting to countries in the Andean region.

MEXICHEM (MEXICO): expansion of the production plant for agricultural piping, accessories, sewage systems and water storage tanks, with pipes

million and will generate 130 jobs.

CEMEX (MEXICO): construction of cement production plant in Bolivar with

for the milling process in order to exercise environmental control and maintain high quality standards.