06 Jun Investment opportunities in tourism in Colombia
In many countries, tourism acts as an engine of development through the inflow of foreign exchange, and the creation of direct and indirect employment. Tourism accounts for 5% of world’s Gross Domestic Product. It is also the fourth export sector, after oil, chemicals and automotive, and represents 235 million jobs; in other words, one of every twelve jobs in the world.
According to Colombia’s Ministry of Commerce, Industry and Tourism (MCIT) in the first half of 2016 the contributions of tourism to the country reached US $ 2,610 million, tourism becoming the second generator of foreign exchange, after oil.
Since 2002, foreign investment in tourism in Colombian has grown by 1500%. Also, according to the report presented by the MCIT, tourism in National Natural Parks is a destination that continues to be positioned in the market. Statistics have shown that during 2016, the visits of foreigners to those places grew 24%, to total 81,752 people.
New tourist areas have been developed in the country because of the peace process between the Government and the Colombian Revolutionary Armed Forces (FARC). This phenomenon has encouraged investment in hotel projects and stimulated the opening of flight routes. This means that national and international tourists are becoming more interested in Colombian destinations due to the increase in security, infrastructure and other associated reasons.
The MCIT has predicted that 400 entrepreneurs in the tourism sector will benefit from the post-conflict, since more visitors will have greater access to the territory.
Ecotourism has also been showing positive results and is the new strategic market in Colombia. The government has started searching for new investors and a strong legal system to foment this sector.
The ministry’s mission for 2017, is to strengthen tourism in four destinations:
- Camino Teyuna-Ciudad Perdida in Magdalena;
- Urabá-Darién Chocó;
- The Macarena in Meta and
Moreover, in terms of security, Colombia has increased the tourism police effectives in 48,9% and it is predicted that this figure will increase by more than 100% by the end of 2017.
Tourism industry in Colombia needed also some changes. That is why the minister stressed the importance of formality in the industry and recently new legal strategies were launched seeking a more formal, inclusive, secure and better prepared industry, ready to receive large investments.
The National Directorate of Tourism Investments has strategically created the National Plan of Tourism Infrastructure, with the purpose of cooperating with investors in the strengthening of the supply and the development of destinations and products at regional and provincial level.
Another important plan implemented in 2017, is called the Tourism Investment Opportunities Network -ROIT. This tool allows the government to have a data base that contains Private Investment Opportunities in the tourism sector. This data base provides investors with the information to see which tourist sectors have not been explored or have received little investment. It will provide information on potential private investments that contribute to the improvement of local and / or regional tourism.
An additional program is the Promotion of Strategic Alliances for Investments with the intention of increasing the achievement of private investments and strategic alliances in the tourism sector, stimulating the establishment of capital that favors the sustainable development of the tourism sector through the promotion of investment opportunities.
The idea of this program is to connect Colombian investors with outer investors. In other words, the program will promote Colombian tourism investment opportunities in the world, through specific material such as fairs, workshops, and business rounds and personalized meetings with the purpose of publicity abroad and within our country.
In the subject of investment, the MCIT counts with the support of national financial entities such as Agrarian National Bank (BNA), BICE Mutual Fund Colombia, and the International Financial Corporation (CFI) to manage different lines of credit.
It is very important to recall that tourism is a sector that employs a lot of manpower. Many tourism activities are especially suited for women, young people and minorities. Due to these special characteristics in the tourism sector, the Colombian government is counting it as one of the solutions for the Reintegration of displaced people from the conflict with the FARC.
In conclusion, MCIT has created several programs to promote investment opportunities in the tourism industry by connecting with investors with plans such as Plan of Tourism Infrastructure, ROIT and Promotion of Strategic Alliances for Investments that give a lot of opportunities for people to invest in Tourism in Colombia.
Jose A. Abusaid