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Published September 2012

PESTLE Analysis of Colombia 2012

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PESTLE Analysis of Colombia 2012

Background: Colombia’s economic growth is primarily driven by private consumption and exports. The government is promoting export by negotiating FTA with many countries and trade regions. The economy experienced moderate growth during 2006-2011 and is forecast to witness good growth over 2012-2017 and reach an estimated $451.6 billion by 2017.

Lucintel, a leading global management consulting and market research firm, makes a concise study and an insightful analysis on Colombia's political, economic, social environments and business risks and presents its findings in "PESTLE Analysis of Colombia 2012 ."

The R&D sector is expected to witness significant growth because of the government's emphasis on increased investment. The government also lays a great emphasis on stabilizing the macroeconomy and controlling inflation in the development plan.

Lucintel has identified that high crime rate, drug trafficking, and heavy dependency on oil export are the major growth challengers. Strong foreign exchange reserve, good business environment, highly educated leading to skilled labor pool, and young population are the drivers providing the economy with a competitive advantage. This Lucintel research report provides a concise overview of the PESTLE analysis of Colombia. It is an insight to the trend analysis of Colombia’s position in terms of GDP, pricing regulation, FDI, consumption, saving, and investment, government policy agenda, sectoral contribution, demographic analysis, labor market, social development index, technology policy, and corporate, tax, and environment laws. This study also provides up-to-date information on the market share, profit margins, capabilities, and strategies of the leaders. The report helps current suppliers realistically assess their capabilities, strategies, vis-a-vis leading competitors. It is designed to provide executives with strategically significant competitor information, data analysis, and insight, critical to the development and implementation of effective marketing and sales plan. This unique report from Lucintel will provide you with valuable information, insights, and tools needed to identify new growth opportunities and operate your business successfully in this market. This report will save hundreds of hours of your own personal research time and will significantly benefit you in expanding your business in this market. In today’s stringent economy, you need every advantage that you can find.

Features of This Report: To make business, investment, and strategic decisions, you need timely, useful information. This market report fulfills this core need and is an indispensable reference guide for multinational materials suppliers, product manufacturers, investors, executives, distributors, and many more that operate in this market. Some of the features of “ PESTLE Analysis of Colombia 2012” include : • Trend and forecast of real GDP growth rate of Colombia • Trend of savings and investments as well as consumption expenditure in percentage of GDP

of Colombia

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PESTLE Analysis of Colombia 2012

• Trend of consumption expenditure as percentage of GDP in Colombia • Trend of growth of population and unemployment rate in Colombia • R&D and technological factor of Colombia 2012

More than 18 figures/charts and 12 tables are provided in this roughly 60-page report. Sample charts with random data are presented below

GD

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Trend of Real Growth Rate 2001-2011 - Random Data

2012 2013 2014 2015 2016 2017

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Forecast of Real GDP Growth Rate Random Data

GDP(2011) Sectoral Contribution: US $Billion - Random Data

Agriculture

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Trend of Saving and Investments as Percentage of GDP - Random

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Saving ( Gross National Savings)

Investments ( Gross Capital Formation)

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PESTLE Analysis of Colombia 2012

2001

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Trend of Colombia's International Trade Structure - Random Data

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Trend of Consumption Expenditure as Percentage of

GDP - Random Data

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2008 2009 2010 2011

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FDI Inflows by Industry -Random Data

Other Services Mining and Quarrying

Manufacturing Construction

Wholesale and Retail Trade Financial Activities

Information and Communication Agriculture, Forestry and Fishing

Total FDI

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PESTLE Analysis of Colombia 2012

Competitive analysis Resource and inventory management Budgeting Investment decisions

Research Methodology: Lucintel has been closely tracking and conducting research on and for the composites and other segments since 1998. This research project was designed for the purposes of determining the investment opportunities in Colombia. To determine the industries and Metro which are having sufficient opportunities. In order to ensure fairness with our analysis, we compared several factors in order to align the current performance and, more importantly, the future prospects. This study is a culmination of 7 months of full-time effort performed by Lucintel's analyst team. Our analysts used the following sources for the creation and completion of this valuable report: • Political, Economic, Social, Technological and legal analysis of Colombia economy. • In-depth secondary research from financial statements and annual reports of the Colombia

National Bank • Extensive search of current published literature, market and database information including

industry news, company press releases, and customer intentions. A compilation of the experiences, judgments, and insights of Lucintel's professional network, who have analyzed and tracked the economic study of the country. Lucintel collects a significant amount of uninterpreted data from a variety of sources and converts this into intelligent data as follows. The intelligent data is used by our clients for making confident business decisions. The figure below is a graphical representation of the end-to-end Lucintel research process.

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PESTLE Analysis of Colombia 2012

Table of Contents

1. Executive Summary

2. Colombia's Political Analysis

2.1: Structure and stability of government 2.2: Government policy agenda

2.2.1: Political agenda

3. Colombia's Economic Analysis 3.1: Sectoral contribution to GDP and real GDP growth rate 3.2: Pricing trends - inflation and interest rates 3.3: Consumption, saving, and investment trends 3.4: International trade and its contribution to GDP 3.5: Foreign direct investment by industry

4. Colombia's Social Analysis 4.1: Social and demographic analysis 4.2: Labor market 4.3: Social development index

5. Colombia's R&D and Technological Factors 5.1: R&D expenditure in Colombia 5.2: Impact of technology in industry 5.3: Technology policy

6. Colombia's Legal Analysis 6.1: Corporate law 6.2: Tax law 6.3: Recent economic policies 6.4: Doing business in Colombia 2012

7. Colombia's Environment Analysis 7.1: Government action against environmental issues 7.2: Environmental policy

8. Colombia's SWOT Analysis

List of Figures Chapter 3. Colombia’s Economic Analysis

Figure 3.1: Trend of real GDP growth rate Figure 3.2: Forecast of real GDP growth rate Figure 3.3: Quarterly trend of GDP growth rate and IIP Figure 3.4: Trend of per capita income Figure 3.5: GDP sectoral contribution Figure 3.6: Share of different sectors to GDP Figure 3.7: Quarterly trend of inflation and interest rate

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PESTLE Analysis of Colombia 2012

Figure 3.8: Annual trend of inflation and interest rate Figure 3.9: Trend of savings and investments as percentage of GDP Figure 3.10: Trend of consumption expenditure as percentage of GDP Figure 3.11: Trend of Colombia’s international trade Figure 3.12: Trend of exports and imports as percentage of GDP Figure 3.13: Foreign direct investment by industry

Chapter 4. Colombia’s Social Analysis

Figure 4.1: Geographical location of Colombia Figure 4.2: Trend of population and population growth rate Figure 4.3: Population age structure by 2017 Figure 4.4: Trend of unemployment rate in Colombia

Chapter 5. Colombia R&D and Technological Factor

Figure 5.1: Trend of R&D expenditure in Colombia

List of Tables Chapter 1. Executive Summary

Table 1.1: Factors affecting business in Colombia

Chapter 2. Colombia's Political Analysis

Table 2.1: Political factors and its impact on business Chapter 3. Colombia’s Economic Analysis

Table 3.1: FDI limits by industry Table 3.2: Economic factors and its impact on business

Chapter 4. Colombia’s Social Analysis

Table 4.1: Corruption, GINI, and Human Development Index Table 4.2: Social Factors and Its Impact on Business

Chapter 5. Colombia R&D and Technological Factor Table 5.1: Technological factors and its impact on business

Chapter 6. Colombia's Legal Analysis Table 6.1: Income tax slab of Colombia Table 6.2: Indicators for starting business Table 6.3: Ranking for procedures of starting business Table 6.4: Legal factors and its impact on business

Chapter 7. Colombia's Environment Analysis

Table 7.1: Environmental factors and its impact on business