USDA Foreign Agricultural Service
Global Agriculture Information Network
Template Version 2.09
Required Report - public distribution Date: 12/12/2003 GAIN Report Number: CO3018 CO3018
Colombia Exporter Guide Annual 2003
Approved by: David J. Mergen U.S Embassy Prepared by: Luz Hernandez, External Contractor Report Highlights: In 2002, total Colombian food andagricultural imports were $1.8 billion. The United States accounted for 28.5 percent of total imports valued at $579.5 million, making Colombia our largest export market in Central and South America. Colombia and the United States will start negotiations for a bilateral free trade agreement in the second quarter of 2004. The trade agreement is expected to provide a major boost to the Colombian economyand imports of food products from the U.S.
Includes PSD Changes: No Includes Trade Matrix: No Annual Report Bogota [CO1] [CO]
GAIN Report - CO3018
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Exporter's Guide to The Colombian Market For Food Products
Office of Agricultural Affairs U.S. Embassy Bogota, Colombia October 2003
USDA Foreign Agricultural Service
GAIN Report - CO3018 TABLEOF CONTENTS I. II. III. IV. V. Executive Summary Economic Outlook Market Overview Exporter Guide Market Structure and Sub-Sector Profile A. Food Processing B. Hotel, Restaurant, Institutional Food C. Retail Food Market VI. Competition VII. Best Product Prospects VIII. Related Reports IX. Post Contact Information I. EXECUTIVE SUMMARY
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In 2002, total Colombian food andagricultural imports were $1.8 billion. The United States accounted for 28.5 percent of total imports valued at $579.5 million, making Colombia our largest export market in Central and South America. Demand for processed foods and other high-value food products grew steadily during the 1990's and has recovered from a recession-induced downturn in 1999. Although, recent indicators reflect a weak growth inproduction and sales that coincides with a high unemployment rate, low income and economic crisis in top trade partner countries, growth tendencies are very favorable. Sales are expected to rise above the projected inflation rate (6.8%). The economy is projected to grow 2.5 percent in 2003 and 3.5 percent in 2004. Colombia and the United States will start negotiations for a bilateral free tradeagreement in the second quarter of 2004. While no specific timetable has been established for finishing the negotiations, the Colombian Government has proposed comp leting the negotiations by the end of 2004, with the agreement implemented at the start of 2006. The trade agreement is expected to provide a major boost to the Colombian economy and imports of food products from the U.S. The foodprocessing industry continues to be one of the largest and most vital sectors of the Colombian economy, accounting for 21 percent of industrial production and 17 percent of industrial employment. The supermarket sector in Colombia is one of the most modern in Latin America, with sales of US$8.5 billion in 2002, of which $3.5 billion was in food products. The hotel, restaurant and institutional sector isalso important, generating 2.1 percent of GDP. It has great potential for growth driven by the tourism sector, though it cont inues to be affected by persistent internal conflict. However, the government campaign “ live Colombia and travel in it” has fostered in-country tourism. Colombia is well endowed with human and natural resources and, should security improve, foreign investment and economicgrowth would be strong and growth in tourism, with its concomitant demand for imported products, would be exponential. Despite the political unrest, industry continues to develop. Concentration and consolidation remain as dominant forc es in the Colombian food market. Domestic supermarket chains continue seeking strategic alliances with foreign partners in a frantic effort to capture market share....