Colombia | Not only construction grows, but it continues to be the fastest growing sector

Economic growth in the third quarter stood at 4.2% YoY, close to our forecast of 4.3% (Figure 1). Economic activity remained stable with regards to the second quarter, when GDP expanded 4.3% YoY. The inter-quarterly variation rebounded during the third quarter to 0.6%, from a negative change of -0.1% between the first and second quarter. Construction continued to be the leading sector. This time, there was a more balanced growth between civil works and buildings. Agriculture, utilities, trade, transport, financial institutions and social services grew as well. On the contrary, industry and mining fell (Figure 2). Forward, sources of growth will change towards non-mining tradable sectors (industry and agriculture), while mining will cease to be an important support for growth. In addition, 2015 GDP growth will depend largely on the execution of fiscal spending in infrastructure. All in all, we have a significant negative bias for our GDP growth forecast of 4.8% for 2015 due to lower oil prices.

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