Colombia’s Economy Grows 3.68% in July: Agriculture and Services Lead

In July, Colombia’s economy experienced a notable upswing, growing by 3.68%. This growth was primarily driven by the agricultural sector and services industry.

The National Administrative Department of Statistics (DANE) released these figures on Wednesday, revealing a trend that has become increasingly common in recent months.

Finance Minister Ricardo Bonilla welcomed the news, highlighting the ongoing economic recovery. He noted that various entities have been improving their year-end forecasts.

The Central Bank is now projecting a 1.8% growth for the year. The primary sector, which includes agriculture and mining, saw a remarkable 7.5% increase.

Services, another significant contributor to economic activity, grew by 3.3%. Public administration, in particular, experienced a substantial 7.7% boost.

Jackeline Piraján, chief economist at Scotiabank Colpatria, pointed out the strong performance of agriculture and the public sector.

She attributed the agricultural success to favorable weather conditions benefiting crops like coffee and bananas, as well as improved exports.

Economic Sector Performance Overview

The secondary sector, encompassing construction and manufacturing, reversed its negative trend over the past two months and grew by 1.5%.

This sector had previously been impacted by government policies, such as limitations on subsidies for new social housing purchases.

When considering seasonally adjusted data, the economy grew by 3.86%. The year-to-date growth from January to July reached 1.9%, according to DANE‘s supplementary report.

Primary activities increased by 4.3% during this period while tertiary activities rose by 2.2%. Looking ahead, Finance Minister Bonilla anticipates a 2% growth by year-end, an upward revision from previous estimates.

David Cubides, director of economic research at Alianza Valores, expects more robust growth in the coming months, projecting 1.8% for the year.

Analysts predict even better economic dynamics in 2025, once the effects of lower interest rates and reduced inflation materialize. Expectations for next year’s growth hover around 3%.

The positive economic trend may also provide the Central Bank with more flexibility to consider further interest rate cuts. While most sectors showed improvement, the commerce sector’s recovery remains uncertain.

It reported a 0.7% annual increase in July, down from 1% in June. Analysts note that the sector continues to experience erratic movements, reflecting its position at the lower end of the economic cycle.

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