Colombia | Current account deficit reached 4.2% of GDP in 1Q 2023

Summary

The current account deficit stood at 4.2% of GDP in Q1 2023 (USD 3,421 million), decreasing from 6.2% in Q1 2022 (USD 5,351Million) and down from 6.1% recorded in the previous quarter.

Key points

• Key points:
• The reduction of the deficit in the first quarter, compared to the same period of 2022, was mainly due to the reduction of the deficit in the trade balance, which fell from 5.8% of GDP last year (USD 4,964 million) to 2.9% this year (USD 2,381 million).
• Primary income (factor income) registered a deficit of USD 4,137 (5.1% of GDP) compared to USD 3,585 a year ago (4.2% of GDP) and secondary income (current transfers) remained relatively stable at USD 3,097 (3.8% of GDP).
• Foreign direct investment (FDI) reached USD4,304 million, falling 11% with respect to that recorded in the first quarter of 2022, although remaining at historically high levels. FDI in the mining and oil sectors grew 103.4% and 41.8%, respectively. With this, FDI represented 5.3% of GDP.
• The current account deficit is expected to continue to moderate in 2023 compared to 2022, driven by a reduction in the trade deficit and relatively stable transfers.

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