Over time the country has excellent advantages for foreigners to consider investing in Colombia and doing business. Its strategic location allows the entry and exit of merchandise in the two oceans (Atlantic and Pacific), and its economic stability, workforce affordable, and tangible and intangible resources.
Additionally, other positive aspects are the easy procedures to start a business, the time, and the cost, not counting the favorable exchange rate for foreign investors.
For this reason, business experts “put their eyes on it” when it comes to investing in Colombia and doing business because they know that it is a country full of opportunities.
Now, within the different investment initiatives, expatgroup.co considers the seven best businesses to invest in Colombia in 2024
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Food and Beverage Industry
The food and beverage sector has demonstrated its relevance by increasing its participation in the national GDP, of which it now represents close to 3%.
The importance of this industry is reflected not only in its growing participation in the country’s GDP, but also in the nearly 650,000 jobs it generates, according to Colombian authorities.
This implies a great investment opportunity in the diverse business models found in this industry, such as cafés, restaurants and franchises, which differ from each other in the capital required and the commercial strategies required for their success, making this an accessible market for many potential entrepreneurs.
Real Estate
This market remains a favorite for investors. This destination has proven to be profitable for many with the valuation of real estate ranging 4% per year.
Likewise, the purchase of real estate has increased in the last years between 10% and 11%. This market, in spite of demanding qualified knowledge, is attractive for those who want to destine their money to the purchase of real estate with diverse destinations in the country.
Expatgroup advises following the current models left by the pandemic, investing in spaces that facilitate remote work with options such as coworking, loft-type spaces, and eco-sustainable properties are some of the alternatives.
At expatgroup, we are experts in this type of investment, we have helped hundreds of foreigners not only helping them to invest calmly and intelligently in the country, but also, advising them in the creation of a company, guiding them to make the best investments according to their needs and expectations, and finally, facilitating the process to obtain the Colombia Investment Visa to enjoy a legal stay in Colombia.
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Many business opportunities are currently emerging in the country’s tourism sector. With an approximate 29% increase in the number of visitors arriving to the country in 2023 compared to 2022, the tourism industry is configured as an attractive option for investors.
Promoting tourism activities in the country takes place on several fronts, such as regulations that seek to boost the arrival of visitors to the country’s tourist destinations, and the increase of air routes to domestic destinations.
Entertainment
The entertainment industry in Colombia continues to grow and is increasingly positioned as a key sector for the country. Its contribution to the economic growth rate in 2023 has ranged between 9.8% and 14.9%.
Increasing large-scale events of all types and for all tastes are being held in different locations throughout the country.
"According to Dane figures, in the second quarter of 2023 the entertainment line had a weight of 166.7% in the variation of GDP, by contributing 0.5 percentage points within the total growth, which stood at 0.3%."
This sector, in turn, is responsible for promoting other economic fronts such as tourism, food and beverages, and consumption by attracting hundreds or thousands of people to the country to attend massive events and festivals.
Creative industries
The creative industries have been slow to reactivate, but they are recovering well and will grow more with investment promotion. Within the orange economy policy framework that involves investments from the cultural sector and Ministerio TIC, el Ministerio de Comercio, Industria y Turismo, and Bancóldex, the country has managed to mobilize $22 billion in the last two years.
Additionally, through the Social Investment Law, companies that are part of the orange economy areas (cultural, creative, and technology-based activities) will access the benefit of income exemption. This benefit means that entrepreneurs who promote creativity and generate employment for the country do not pay income tax for seven years.
The Creative and Content Industries contribute 3.3% to the National GDP and 5.8% contribution to the country’s economic development, so investing in this type of industry, such as film, publishing, photography, computer programs, architecture, and others, brings excellent tax benefits that translate into more significant and better profitability.
Mining
Although mining has remained one of the most profitable activities for the country over the years, the various actors in this sector face uncertainty for the coming year.
The decrease in the percentage contribution of this sector from 9.20% to 6.19% in the last quarter of 2023, added to relevant announcements such as the implementation of new policies limiting hydrocarbon mining activity and international falls in the price of coal, augur a decrease in the collection of this sector for the year 2024.
Technology
One of the sectors with the highest growth projection due to the AI revolution, and the growing number of technological solutions required nationally and globally.
In 2022, its collection was close to 46.7 trillion pesos, with an increase of 16.3% compared to the previous year.
Policies such as «the valley of software» applied in Medellín demonstrate the institutional interest and efforts to encourage this sector.
Among the investment opportunities in the technology sector in Colombia are:
To sum up
Colombia is a country that continues to grow. It not only offers foreigners a destination for rest or adventure, but our country also has an attractive offer in various sectors for investment.
Our country has different business ecosystems, the attractiveness of tax incentives, and continuous economic development. In addition, qualified companies can accompany expats to create companies or advise on investing in Colombia. This makes us wonder less why Colombia is a great destination to invest and do business.
Book an appointment with our specialists, and don’t miss the opportunity to make a successful investment in Colombia.
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FAQs about business investments in Colombia
Colombia has a legal framework that regulates foreign investments, with laws that promote and protect investors’ rights. The primary law governing foreign investments is Law 80 of 1993, which establishes the basic rules for foreign investment in Colombia. In addition, there are international investment protection treaties signed by Colombia, which offer additional guarantees to foreign investors. Foreign business people need to understand these laws and regulations to ensure compliance and protection of their investments.
Establishing a company in Colombia as a foreigner involves several steps. First, it is necessary to register the company with the local Chamber of Commerce and obtain a NIT (Tax Identification Number). Then, a business or investor visa must be obtained, depending on the business activity to be carried out. Subsequently, tax and labor requirements must be complied with, and the necessary permits and licenses to operate legally in the country must be obtained. It is advisable to seek legal and accounting advice to ensure a smooth and seamless establishment process.
Colombia offers several tax incentives and support programs for foreign companies investing in the country. These may include tax exemptions, reductions in tax rates, tax deductions for investments in specific sectors or regions, and financing and subsidy programs. Incentives vary depending on the sector of activity and geographic location of the investment. Researching and consulting with local authorities or investment promotion agencies is essential to determine what incentives are available and how to take advantage of them.
Like any other country, investing in Colombia carries certain risks, which may include political, economic, social, and security risks. To mitigate these risks, conducting thorough due diligence is critical, as well as understanding the country’s business and political environment, diversifying investments, establishing local solid support networks, and purchasing insurance and security services if necessary. In addition, staying up-to-date on the country’s economic and political landscape and adapting strategies as needed are crucial to managing risks effectively.
There are opportunities for regional expansion from Colombia into other countries in various world regions. With an emerging economy and strategic geographic location, Colombian companies can pursue growth opportunities in global markets. Some areas for expansion include North America, Europe, Asia and Africa. Taking advantage of free trade agreements, establishing strategic alliances, and leveraging Colombia’s competitive advantages, such as its skilled labor force and natural resources, can facilitate penetration into new markets and international business expansion.
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