Colombia | Investment leads the way, but growth remains moderate

Colombia's GDP grew 2.0% year-on-year in Q3 2024, driven by investment in civil works and machinery, though with moderate private consumption and a decline in public consumption. Growth is projected at 2.0% for 2024, with gradual acceleration in 2025, led by investment and goods consumption.

Key points

• Key points:
• Investment led growth for the second consecutive quarter, with civil works and machinery as the main drivers. This marks a shift away from reliance on consumption, though housing investment remains lagging, limiting its impact on key sectors like manufacturing and mining.
• Private consumption showed mixed results: durable goods benefited from lower financial costs, while non-durables and services, such as education and tourism, posted more moderate growth. Public consumption, however, saw a sharp decline, weighing on overall growth.
• Service exports accounted for 18% of total exports, surpassing 2019 levels and hitting a record high. This underscores the growing role of services in diversifying Colombia's external trade, despite challenges in other sectors.
• The quarterly GDP performance, with just 0.2% growth, highlights the moderate pace of economic recovery. However, investment and goods consumption could drive gradual acceleration in 2025, particularly with the expected recovery in housing during the year's second half.
• Projections for 2025 point to gradual acceleration in growth, driven by civil works, machinery, and durable goods, with the housing sector expected to join the recovery in the second half of next year, boosting economic performance.

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