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Investment from U.S. grows 39% since 2012

Article - February 26, 2016

U.S.-Colombia dialogue moves from one dominated by “drug trafficking and security, to one in which we can talk about science and technology, education and various other aspects of the country’s development,” says Colombia’s foreign affairs minister, María Angela Holguín Cuéllar


Having marked the third anniversary of its implementation with no great fuss or fanfare, the Trade Promotion Agreement (TPA) between the United States and Colombia will possibly never be the stuff of which sizzling headlines are made, but its results can serve as an occasion for evaluating the repercussions it has had in the broader context of bilateral relations.

Ten years of hard bargaining were needed to open up each country to all but a handful of the other’s goods and services. On the bottom line for 2013, Colombia came out $3 billion ahead of its larger partner, but ended the following year $3 billion in the hole mainly on account of the global slump in the price of petroleum, Colombia’s main export to the United States, as well as the source of 60% of its total foreign earnings.

But on a brighter note for Colombia: foreign direct investment originating from the United States is up by 39% since 2012.  Two years later, the number of Colombian companies exporting to the United States for the first time came up just shy of the 2,000 mark with over 400 new products on offer, many of them in the booming fields of fashion, fabrics and apparel. But some people who are not directly involved in that two-way flow may not be aware of how far its effects extend beyond the purview of international commerce.

“It’s an altogether different kind of dialogue now,” says Colombia’s foreign minister, María Angela Holguín Cuéllar, characterizing her country’s relations with the United States. “We have moved on from an agenda that used to be all about conflict, drug trafficking and security, to one in which we can talk about science and technology, education and various other aspects of the country’s development.

“We still have much that needs to be done regarding security and human rights, but we are also making progress in fields much more attractive to the United States,” the minister adds. “I think they see Colombia as an example of real effort that pays off in terms of positive outcomes.”

“It took ten years of negotiations and approval by the U.S. Congress to get (the Trade Promotion Agreement) up and running. It’s up to us to show that we know how to make good use of this marvelous instrument”

Camilo Reyes Rodriguez, Executive Director, AMCHAM

Colombia has a lengthy relationship with the United States that by and large has remained consistently cordial over time, even when other South American governments were vested heavily into populist or left-wing ideology fiercely opposed to Washington’s foreign policy.

Yet successive Colombian administrations fully supported controversial moves such as the 2003 invasion of Iraq and the UN resolution authorizing the invasion of Libya.

In 2009, Bogotá allowed its troops to deploy in Afghanistan under the command of the Spanish contingent in that country. More recently, President Juan Manuel Santos has made it clear that he sees Colombia as a future candidate for NATO membership.

In the 1990s Washington had become involved with the training and funding of Colombian security forces in their campaign to neutralize FARC.

The United States’ military presence in the country was not welcomed by many Colombians. It was predicated on unsupported assumptions that in addition to being Communist insurgents, FARC guerrillas were playing a significant role in their country’s upstream cocaine trade, it being taken for granted that the drug in question would end up being consumed in the United States. Years later, a study by the U.S. Drug Enforcement Administration (DEA) concluded that this was simply not so, but by then FARC had grown to become the largest, as well as the oldest Western Hemisphere rebel group.       

Since peace talks between the government and FARC began in 2012, the U.S. has played a supportive role; and since February, 2015, President Barack Obama’s special envoy has been sitting at the table with negotiators as an observer.

“I want to congratulate President Santos on his extraordinary efforts to bring about an end to a conflict that has plagued Colombia for too long,” President Obama said last April when he attended the Summit of the Americas in Panama City. “The United States is very proud to support that effort and I’ve deployed envoy Bernard Aronson, with deep experience in the region, to be supportive of President Santos’s efforts.  This is an issue that many people care deeply about. It entails some risks but President Santos, I believe, is doing the right thing, and we want to be as helpful as we can in the process.”

According to an official statement from the U.S. Department of State, “the U.S. government supports Colombian efforts to transition from conflict towards peace by working in the most conflictive and neglected rural areas of Colombia, where violence, the lack of government presence, and the absence of licit economic opportunities have historically converged.

The statement goes on to note that “U.S. programs provide support for  the implementation of Colombian government reforms in land restitution; reparations for victims and vulnerable populations, including ethnic communities; public and private investments, in particular to foster a vibrant rural economy; reintegration of ex-combatants; promoting respect for human rights and the rule of law; protection of vulnerable citizens (such as human rights and labor activists); and addressing global climate change and environmental issues in one of the most ecologically diverse countries in the world.”

Camilo Reyes Rodriguez is Executive Director of the American Chamber of Commerce in Bogota. He believes that a peace accord will result in “a remarkable transformation, generating progress, development and social equality”.

On the subject of the TPA, Mr. Reyes Rodriguez adds, “We won’t see so many ups and downs as before. It took ten years of negotiations and approval by the U.S. Congress to get this up and running and it comes equipped with a permanent set of rules that constitute a stable platform for regulating business and commerce. It’s up to us, though, to show that we know how to make good use of this marvelous instrument.”    

Ms. Holguín Cuéllar agrees with that upbeat view. “People need to see the last of these armed groups and to feel that somehow opportunities should become available to everyone. The United States and Europe have had a fundamental role in that. Their support has been unconditional, not just political support for the idea of peace, but also the what-comes-after part.”

Washington, she says, has delivered on its pledges to help Colombia plan for its post-conflict reboot as a nation. “Agriculture and education are our biggest concerns.

A lot of the time I hear it said that we may be getting ahead of ourselves, but I think if peace should come about, we have to be prepared for it. The United States has demonstrated its solidarity with us on that point especially.”

One detail that took much back-and-forth bargaining to resolve had to do with Washington’s insistence that Colombia take hard and fast measures to ensure the rights and safety of labor union organizers or union members who had long been targeted by right-wing militias, death squads and assassins for hire. In their final form, the TPA accords also defend workers’ rights to collective bargaining and prohibit child labor, race- or gender-based workplace discrimination, while it calls on the government to defend and enforce a legal framework that establishes a minimum wage, maximum working hours and addresses occupational safety concerns