Colombia | Growth in 2024: positive, but with an incomplete recovery

Summary

GDP grew 1.7% in 2024, led by domestic demand (+2.2%). Private consumption (1.6%) was driven by a rebound in durable goods and services, while fixed investment (3.0%) grew due to machinery, equipment, and civil works. In 2025, growth is expected at 2.5%, with better financial conditions but fiscal and global risks.

Key points

• Key points:
• Domestic demand grew 2.2%, leading economic expansion in 2024 and outpacing GDP growth. The recovery in household spending and investment, along with inventory accumulation, drove growth.
• Private consumption grew 1.6% in 2024, with a greater contribution from services (58% of total consumption) compared to goods but with a significant recovery in durable goods spending. Total private consumption reached 123% of its 2019 level, with recreation & culture (+202%) showing the strongest growth. Fixed investment grew 3.0%, driven mainly by machinery, equipment, and civil works. Building construction showed slight growth but failed to consolidate a full recovery. Inventories accumulated throughout the year, reversing 2023’s destocking trend, suggesting that businesses anticipate higher demand in 2025.
• On a quarterly basis, GDP grew 2.3% year-over-year and 0.6% quarter-over-quarter, consolidating a moderate but stable recovery. Domestic demand accelerated in both consumption and investment, while public consumption continued to decline. The manufacturing sector saw a slight rebound, benefiting from better inventory turnover and higher production in segments such as food and textiles. The economy closed the year with strong momentum, as reflected in the ISE economic activity index, which grew 2.9% year-over-year and 1.4% quarter-over-quarter in December.
• For 2025, growth is expected at 2.5%, supported by better financial conditions and credit recovery. However, risks remain due to fiscal constraints, global uncertainty, and the slow recovery of lagging sectors like construction and mining.

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