Colombia | In the second quarter, the current account deficit stood at 3% of GDP

Summary

The current account deficit reached USD 2,525 million in the second quarter and represented 3% of GDP, decreasing by 49% with respect to the value recorded in the second quarter of 2022. The deficit reduction was driven by the adjustment in the trade balance.

Key points

• Key points:
• In the second quarter, the current account stood at 3% of GDP. This deficit is the lowest observed since the fourth quarter of 2017, when it represented 1.8% of GDP
• The deficit reduction was led by the adjustment in the trade balance, which decreased by 39.4% compared to the same quarter in 2022 (from US$4.473 billion to US$2.14 billion) and went from representing 3.5% of GDP to 2.5%.
• The deficit in primary income, which captures the balance of factor income, was USD 3,401 million, decreasing by 26.6% compared to Q2 2022 and went from representing 5.1% of GDP in Q2 2022 to 4.0% of GDP in Q2 2023.
• Secondary income (remittances and other current transfers) represented 3.5% of GDP despite a 0.4% reduction in remittance income.
• Foreign direct investment reached USD 9,561 million, growing by 3.1% compared to the second quarter of 2022 and represented 6.2% of GDP.

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