Colombia | Capital markets as partners in sectoral development

Summary

Sectoral focus is crucial for Colombia's economic recovery, but this requires investment. In Colombia and globally, financing is largely reliant on own resources and bank loans, overlooking the potential of capital markets to fuel sectoral growth.

Key points

• Key points:
• Sectoral growth is uneven, and economic recovery, from this perspective, requires flexible investment and financing strategies.
• Capital markets drive economic growth by linking funding needs with investors' capacity to mobilize savings, allowing for an efficient allocation of resources.
• Most entities rely on own resources and bank loans, resulting in low stock market capitalization, particularly in emerging economies. Brazil and Chile lead with capitalization levels between 45% and 55% of GDP, while in Colombia, it is around 20% of GDP and decreasing.
• Strong sectoral growth will depend on distinguishing sector-specific needs, turning them into investment opportunities, and effectively connecting funding needs with providers.
• Expanding financing sources to boost the relevance of capital markets calls for greater investment paired with more efficient financing; broadening the investor base by attracting both local and foreign savings; and improving access and liquidity in bond and equity markets.

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