Colombia, a Country of

Prosperity and Democracy

Colombia, a Country of Prosperity and Democracy

Over the last decade, Colombia has been able to position itself as a leader in the region, as a result of the strengthening of its institutions, the attainment of increased security for its population throughout the national territory, and, above all, thanks to the capabilities and enterprising talent of its people. The Colombian State is a strong and solid democracy with a long-standing tradition within the region.

The aim of the new government of President Juan Manuel Santos is the achievement of a social contract enabling Colombians to build a better country based on democratic prosperity. The underlying axis of this strategy is the generation of employment, in order to provide secure incomes, decent jobs and social security coverage for all Colombians. To this end, five so-called engines were selected to drive forward the economy during his government: agriculture, social interest housing, mining, innovation and infrastructure.

There is much that Colombia has to offer to the world. It is a megadiverse country, committed to the environment, renewable energy and biofuels, in addition to being a safe and exotic tourist destination. It is a part of the dynamic group of emerging economies known as CIVETS and is considered a world power in mining and energy. Colombia has made the decision to support other nations and regions through international cooperation in different fields including through South-South Cooperation. Furthermore, it has reasserted its firm commitment to the protection and promotion of human rights, in accordance with the democratic, ethical and human convictions of the Colombian State.

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A megadiverse country, committed to the environment

Colombia is one of the 17 megadiverse countries in the world, with the most significant biodiversity per square kilometer, making it a global power in terms of biodiversity and natural assets. It houses 10% of the planet’s biodiversity and 7% of the Amazon rainforest, even though its territory represents only 0.7% of the world's continental surface. Accordingly, a number of focused national policies have been implemented to promote and foster the preservation of the environment; over 12.6 million hectares, equivalent to more than 10% of Colombia's continental and maritime territory, have been designated as Natural National Parks.

The Colombian State is aware of the fact that the protection of natural resources, as well as of ecosystemic services and functions, are essential for the socioeconomic development of the country. Sustainable exploitation of these resources will generate benefits for present and future generations, enabling them to overcome poverty and creating opportunities for new productive undertakings. One example of this is the generation of new benefits through the application and development of knowledge in biotechnology, an innovative area with a promising future.

Climate Change

Matters related to climate change, both adaptation and mitigation, have become a major priority for Colombia, as well as for the international community.

Mitigation

Colombia has the privilege of having a clean energy matrix, given that more than 75% of its power generation is produced by hydroelectric plants. Also, a number of significant mitigation actions are being implemented in different areas on a voluntary basis, including mass transport systems and investment in the development of alternative energy sources, such as biofuels.

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Given its rich natural assets, Colombia values international initiatives such as Reducing Emissions from Deforestation and Forest Degradation (REDD). Forests store large quantities of carbon, thus making their proper management an essential requirement as a partial solution to climate change. It is estimated that deforestation and forest degradation currently generate close to 20% of the greenhouse effect gases (GHG) worldwide. The REDD projects provide for the establishment of financial incentives for forest preservation and the resulting reduction of GHG emission. For countries with significant forest resources such as Colombia, it will become an important source of financial resources to support sustainable development options in the country.

Adaptation

As a country, Colombia contributes 0.37% of the pollution of GHG, but it is highly vulnerable to the effects of climate change. Following the devastating floods that affected over 2.4 million people in late 2010, the Government of Colombia has assigned priority to ensuring that climate change adaptation considerations are incorporated into planning and decision making processes. Currently Colombia is in the process of developing its National Adaptation to Climate Change Plan. As part of its commitment, Colombia is actively participating in the ongoing negotiations in the framework of the UNFCCC, and is strongly supportive of the emerging Adaptation Framework.

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44,205,293Po

pula

tion

2010

(Mill

ions

)

United States (39,2%) Venezuela (12,3%) UE (14,30%) Ecuador (3,83%)Peru (2,4%)Mexico (1,63%)Germany (1,24%),

Mai

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9

United States (28,93%) China (11,15%)Brasil (6,51%)Mexico (7,05%)Germany (4,12%)Japon (2,50%)Venezuela (1,69%)Ecuador (2,16%)Spain (1,34%)

Mai

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00

9

157%

Num

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20

02

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10

Colombia is second worldwide in:

• Banana production• Variety of Butterflies (300 families and 14,000 species) • Production and export of flowers • Production of blackberries

The tenth country in the world with the best environmental performance (University Yale)

3,1%

2,2% 2,5%

4,6% 4,7%5,7%

6,8%7,5%

2,5%

-0.7% - 0,4%

4,3%

-3%

-2%

-1%

0%

1%

2%

3%

4%

5%

6%

7%

8%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2009 2010

Colombia GDP Growth vs. The World 2000 - I Trim 2010 (%)

Colombia World

Colombia is first in: :

• Production of Emeralds Variety of Palm Trees (244 species)• Bamboo Production in America• Coffee Quality• Major exporter of Arabian Coffee• Major coal exporter in Latin America• Biodiversity per km2• Higher number of birds and amphibians in the world

Dynamic Economy

4,7%

The positive agenda of the Colombian Government established five strategic axes of the so-called "engines of progress", which are expected to foster growth and development of the Colombian economy: housing, mining, innovation, agriculture and infrastructure.

In fact, the world is already viewing Colombia with great interest: It is an economically solid and stable country, providing impressive business opportunities, legal security for investors, low inflation, controlled fiscal deficit, diversified product offerings, qualified human resources, and a private sector prepared to exchange experiences and benefits.

After the dynamic growth of the BRICs (Brazil, Russia, India and China), a new group of six countries called CIVETS is emerging: Colombia, Indonesia, Vietnam, Egypt, Turkey and South Africa, which, according to experts, will become the future drivers of the world's economy. The CIVETS economies are becoming increasingly attractive investment destinations and are expected to generate a 4.5% growth in Gross Domestic Product (GDP) over the next 20 years, far above the estimates for the G7 countries, which are estimated to be of approximately 1.8%, making them extremely interesting business scenarios. They are countries with mainly young and growing populations, diverse and dynamic economies, political stability and a brilliant future . The emerging markets of the CIVETS will grow three times faster than developed countries. In addition, these countries have demonstrated their resilience in the face of the global financial crisis, thanks to the application of sound policies and a solid economic base. Consolidation of the CIVETS and their future alliances will shape the new dynamics for the economy of the twenty-first century.

"Any company with global ambition needs to act now in regard to these markets (CIVETS)... You have to go where the business is." Speech to the Chamber of Commerce of

Hong Kong by Michael Geoghegan, HSBC Group Chief Executive, on 27 April 2010. Available at www.hsbc.com

1 Michael Geoghegan, Chief Executive of the HSBC Group.

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By 2011, Colombia expects to have completed negotiations of 11 free trade agreements

(FTA) with 48 countries, gaining preferential access to more than 1,500 million consumers.

21 double taxation agreements (ADT) with 22 countries

Sign

atur

e

United StatesEFTA (Iceland, Liechtenstein, Norway and Switzerland)CanadaEuropean Union (signature)

In fo

rce

CAN (Perú, Ecuador, Bolivia)MERCOSUR (Argentina, Paraguay, Uruguay and Brazil)ChileG2-MéxicoTriangulo Norte (Honduras, Guatemala and El Salvador)

Futu

re O

nes Japan

AustraliaNew ZelandTurkeyCosta RicaDominican RepublicGulf Community

South KoreaPanama

In n

egot

iati

ons

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Colombia is one of the 17 megadiverse countries in the world, with the most significant biodiversity per square kilometer, making it a global power in terms of biodiversity and natural assets. It houses 10% of the planet’s biodiversity and 7% of the Amazon rainforest, even though its territory represents only 0.7% of the world's continental surface. Accordingly, a number of focused national policies have been implemented to promote and foster the preservation of the environment; over 12.6 million hectares, equivalent to more than 10% of Colombia's continental and maritime territory, have been designated as Natural National Parks.

The Colombian State is aware of the fact that the protection of natural resources, as well as of ecosystemic services and functions, are essential for the socioeconomic development of the country. Sustainable exploitation of these resources will generate benefits for present and future generations, enabling them to overcome poverty and creating opportunities for new productive undertakings. One example of this is the generation of new benefits through the application and development of knowledge in biotechnology, an innovative area with a promising future.

Climate Change

Matters related to climate change, both adaptation and mitigation, have become a major priority for Colombia, as well as for the international community.

Mitigation

Colombia has the privilege of having a clean energy matrix, given that more than 75% of its power generation is produced by hydroelectric plants. Also, a number of significant mitigation actions are being implemented in different areas on a voluntary basis, including mass transport systems and investment in the development of alternative energy sources, such as biofuels.

Renewable energy and biofuels

Colombia has implemented a solid policy aimed at the generation of a regulatory framework and the creation of financial instruments and conditions for the furtherance of sustainable production of renewable energy and biofuels.

Renewable energy power production in 2008:

46,403 GWH hydroelectric energy, 590 GWH solid biomass and 54 GWH wind energy

Several studies are currently ongoing with a view to increasing renewable energy generation in Colombia, mainly in solar, biomass and geothermal energy projects, which show significant potential, given the geographical and geological location of the country. Thus, Empresas Publicas de Medellin (EPM) deployed its first eolic park, Jepirachi, in the Upper Guajira, with 15 aerogenerators that provide 19.5 megawatts to the National Interconnected System, with the potential for expansion to other areas of the country.

In order to stimulate investment in biofuels, the producing plants are entitled to a special taxation system allowing them to import machinery free of duties and a single income tax rate of 15%. As a marketing incentive, ethanol and biodiesel products intended for diesel - gasoline mixtures are exempt from excise taxes. The current production capacity of Colombia is 1.1 million liters of ethanol per day and 1.8 million liters of biodiesel per day. These figures will grow as a result of the construction of five sugar cane and beet-based ethanol projects, with a production capacity approaching 1.5 million liters per day by 2012. New biodiesel plants will shortly be added to the six that are already in existence, thereby increasing production by 1.8 million liters per day.

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As a leader of the biofuel committee of the Mesoamerica Integration and Development Project, Colombia replicated its experience in other Latin American countries. In 2009, two biodiesel plants were established in El Salvador and Honduras, designed and built with Colombian technology, with a capacity of up to 10,000 liters per day and the possibility of using different sources of raw materials. These accomplishments will position Colombia as a leader in the development of homegrown technologies, transfer of knowledge, and biofuel production.

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Mining - Energy sector

"The entire world is viewing Colombia as a world power in energy and mining.”2 Indeed, the significant growth of the mining-energy sector has positioned Colombia on the international radar. Exports of the mining-energy sector have grown 13% and currently represent 50% of the national total.

The government’s aim is to increase the country's hydrocarbon production and reserves; to this end, it will sign 205 new exploitation and production agreements over the next 4 years. 570 wells will be drilled by 2014, in order to reach a production of 1.15 million barrels of oil per day.

As of September 2010, electric power generation of the National Interconnected System was composed of 78.2% hydraulic generation, 16.5% thermal generation and 5.3% small and cogeneration plants.

During 2010, Colombia produced an average 785,000 barrels per day, 100,000 barrels more than in 2009, representing an increase of 14.6%.

Foreign direct investment in the mining sector since 2002 has been increasing by 664% to reach USD$2,116 million in 2008.3 Colombia is the second-largest coal producer in Latin America, after Brazil, with 49,900 tons in 2009, representing 1.4% of world production.

According to British Petroleum, Colombia is the third-largest oil producer in the region, with crude reserves of 1,990 million barrels.

"Colombia is positioning itself as one of the energy powers of the region. Colombian electrical energy is in great demand"4 Regarding interconnection systems, the country is currently in the process of developing the infrastructure required to implement the Panama-Colombia-Chile interconnection project. The projects under construction will enable Colombia to increase its electrical energy exports to Central America.

3.Remarks by President Juan Manuel Santos at the conclusion of the Assessment Discussion Session at the Ministry of Mines and Energy, 3 February 2011. 4. Hotels spring up as Colombia grows safer for tourists. Los the Angeles Times, August 6, 2010.

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Tourism, a country of diversity

The National Government has worked intensively to guarantee the presence of the State throughout the entire national territory, and to reinstate peace and confidence for all citizens and foreigners living and traveling in the country. The effort to provide security throughout the country has produced conclusive results, making Colombia a safe tourist destination and resulting in an increase in the number of visitors from around the world.

732 668

1700

1876

0

200

400

600

800

1000

1200

1400

1600

1800

2000

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Increase 2008-2009: 17.2% (includes cruises)- Increase from 2009 to 2010: 10.3% (includes cruises) * Includes cruises ** Does not include cruises

Source: Administrative Department of Security

The number of visitors tripled in six years

While world tourism grew by 6.7%, Colombian increased

by 8.9% in 2010 **

Main nationalities, 2010 **: 345,158 U.S. visitors (23.4%)

197,173 Venezuelan visitors (13.4%) 122,076 Ecuadorian visitors (8.3%)

83,674 Argentine visitors (5.7%)

Tourism, 2000 – 2010Thousand of Visitors *

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Colombia is a country of great cultural diversity, as evidenced by the more than 700 traditional events, festivals and carnivals, architectural and handicraft techniques from the most traditional cultures that still persist today, hundreds of historical monuments, and a great variety of customs, values and wisdom that identify its heritage.

The Colombian Government has been implementing various initiatives on several fronts in order to position the country as a world-class tourist destination and to achieve sustained growth for this sector: improvements in tourist competitiveness, services and transportation infrastructure, the development of tourist megaprojects, liberalization of visa issuing procedures, and an "open skies” policy. At the 2010 and 2011 International Tourism Fair (Fitur) in Madrid (Spain), Colombia positioned itself as the new green destination, emphasizing Colombia's natural heritage as its foremost strategy for the promotion of international tourism.

The Los Angeles Times highlighted the 17% increase in Colombia's international visitors in 2009, compared with a global tourism gain of just 2%, as well as the surge in projects by international chains Hilton, Sonesta, Intercontinental, NH and Marriot.5 Colombia´s growing status as a top tourist destination was acknowledged by The New York Times, when it included Colombia in its list of the best tourist places to visit in 2011.

5 Hotels spring up as Colombia grows safer for tourists. Los the Angeles Times, August 6, 2010.

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Cooperation, one of the pillars of colombian foreign policy

115

22526

2815

1323

3042

811

31

0 10 20 30 40 50

In addition to commercial negotiations and political dialogue, cooperation has become one of the three fundamental pillars of Colombia’s foreign policy. In light of the improvements that Colombia has achieved in terms of security, human rights, and the fight against the world drug problem, the thematic and geographical diversification of the international cooperation agenda has become one of the priorities for the National Government. In this context, Colombia is keen to further position itself as a leader in generating strategic alliances for development through South – South cooperation.

Throughout the region, the country has a long tradition of working in a collegiate and collaborative manner with other countries. During the last four years it has strengthened its programmes, positioning itself as a partner country for technical cooperation in the region. Today, Colombia has active cooperation relations with 32 countries from Latin America and the Caribbean, transferring and developing capacities in such fields as the environment, energy, justice and security.

Projects by sector2011

Sourse: Ministry of Foreign Affaires

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HOUSING, URBAN DEVELOPMENT AND TRANSPORT

WORK

SECURITY AND JUSTICE

HEALTH

STATE MODERNIZATION

ENVIRONMENT

GOVERNANCE

ENERGY

EDUCATION

DEVELOPMENT AND POPULATION

PRODUCTION DEVELOPMENT

SCIENCE AND TECHNOLOGY

ART AND CULTURE

WATER AND SANITATION

AGRICULTURAL

AGRICULTURE

The creation of diverse mechanisms has enabled the country to support different programs and projects, such as: the South-South Cooperation Strengthening Program, Colombia's Cooperation Strategy with the Caribbean Basin, cooperation on Integral Security with Central America and the Caribbean, the Mesoamerica Project, as well as an active presence and support in the reconstruction of Haiti.

Country programs South – South Cooperation

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Organisation for Economic Cooperation and DevelopmentColombia intensifies its efforts for rapprochement with the OECD

With the aim of attaining OECD membership, Colombia has introduced a number of OECD-level policy standards with regard to economic, investment, development and cooperation issues. Colombia´s rapprochement to the OECD represents an opportunity to gradually join a multilateral system of best practices that will serve to strengthen public policies. This scenario will enable it to gain privileged access to information regarding various economic, social and environmental issues, as well as resources and implementation of cooperation programs, which constitute essential elements to enable Colombia to strengthen/catalyze its economic and social development, thereby contributing to poverty alleviation.

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A country committed to human rights

Colombia’s firm and irrevocable commitment to the protection and promotion of human rights is rooted in the democratic, ethical and human convictions of the Colombian State, and does not stem from external demands. The actions that have been undertaken respond to the demands for respect and promotion of human rights and have resulted in a dramatic reduction in crime and in behaviors that threaten the life and fundamental liberties of the Colombian people.

Justice and Peace LawVictims and Land Restitution Bill

Colombia is the only country that comprehensively applies the principles of truth, justice and reparation for the victims of demobilized illegal armed groups (Justice and Peace Law).

Over 55,000 victims have been involved in criminal proceedings and were able to question their abusers.

Over USD$250 million have been assigned for reparation to approximately 25,000 victims.

The Victims and Land Restitution Bill has already been approved in the House of Representatives and will be ratified by the Senate in March. President Juan Manuel Santos was invited to attend the ninth session of the Assembly of States Parties of the International Criminal Court in New York on 6 December 2010, where he proclaimed the "determination to fight impunity in our country and our firm support to the work of the International Criminal Court. I come to say that the government of Colombia has the strongest will – I want to make this clear – to recognize and enforce the rights of victims to truth, justice and reparation".6

6 Remarks by the President of the Republic of Colombia, Juan Manuel Santos, at the ninth session of the Assembly of State Parties of the International Criminal Court, 6 December 2010.

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177880

2354

4857 5221 5446 55076097

9444

107161117910806

0

2000

4000

6000

8000

10000

12000

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Source: Ministry of the Interior and Justice – January 2011

Direct Beneficiaries of Protection Measures

Human rights defenders

The Colombian Government is currently promoting a number of initiatives aimed at institutionalizing an active strategy of protection and guarantees for human rights defenders:

National Commission of Guarantees: The Commission is establishing new commitments in line with the particular situation and needs of each population group. It was agreed at the last session that each of these issues would be addressed by thematic committees, scheduled for February and March 2011.

Protection Program for Human Rights Defenders: The Program includes a procedure for the approval of emergency measures, which may be adopted at the discretion of the Director of Human Rights of the Ministry of the Interior and Justice. The budget of the Program has been significantly increased, from USD$13.6 million in 2002 to more than USD$58 million in 2009. The number of direct beneficiaries of protection measures by the Colombian State increased by more than 620% between 1999 and 2009.

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Ministry of Foreign AffairsRepublic of Colombia