Productivity: the fuel that can drive growth engines in Colombia in the coming years
Productivity, one of the important variables of the national economy. Photo: Courtesy
TL;DR
- Colombia's economy is projected to grow below 3% in the medium term, with challenges in fiscal matters and global uncertainty.
- McKinsey & Company suggests that increased productivity, rather than just more working hours, can significantly boost Colombia's economic growth.
- The country has been growing more by increasing the number of workers than by improving their productivity.
- To achieve ambitious GDP growth targets by 2040, Colombia needs to transition towards higher productivity and value-added activities.
- Key strategic sectors for growth include exportable digital services, data centers, and sophisticated agro-industry.
- Lack of execution and insufficient, poorly directed investment are major obstacles to productivity growth in Colombia.
- Investment is attracted by opportunities and predictable regulations; unstable conditions lead businesses to minimize essential operations.
- The report highlights that digital services could contribute between USD 10-25 billion, and agro-industry between USD 20-30 billion with increased sophistication and processing.
- Developing these sectors can enhance competitiveness, create higher-value jobs, and integrate Colombia into global trade and investment flows.