Colombia seeks to attract sustainable foreign investment

14 December 2021
At the UN climate change conference (COP26) Colombia ratified its commitments to declare 30% of its territory a protected area by 2022 and carbon neutrality by 2050. In addition, the President of the Republic, Iván Duque, affirmed that technology is an essential ally for Colombia to be a more assertive country in terms of sustainable development and environmental protection in the region and assured that his legacy will include a robust strategy for mobilizing climate finance and sustainable investment.

In recent years, green investments in Colombia have grown rapidly. According to the IMD - World Competitiveness Yearbook, Colombia ranks first in the region in the implementation of ethical practices and sustainable development standards. Colombia was also one of the first countries to include the Sustainable Development Goals (SDGs) in its National Development Plan and is one of the top five countries that report the most sustainable practices to the Global Reporting Initiative (GRI).

Due to a sustained and collective effort, it is also worth mentioning that, back in May 2020, Colombia was elected by the members of the Steering Committee of the National Advisory Board (NAB), to become an active member of this organization, which has the mission of unifying standards and metrics regarding impact investing in the country.

Colombia has a competitive labor force, a privileged geographical location, and a package of 17 trade agreements that allow Colombia to access 97% of the continent's markets with preferential conditions. The country offers as well, a robust package of incentives, including the Free Trade Zone and Mega-investment regimes, or the Energy Transition Law, which extends tax benefits for renewable energies.

Recently, during COP26, a coalition of 450 financiers from 45 countries announced the availability of up to US$130 billion in investments in the coming years to achieve carbon neutrality by 2050. And, to have access to part of these resources, Colombia must keep preparing itself and achieve a solid offer that responds to the needs of sophisticated investors.

 

"From the experience in Glasgow we were able to see how the international private sector perceives that Colombia could be the regional pioneer in consolidating a solid and serious offer of sustainable business. The reactivation is an opportunity to encourage companies to organize their production processes and make them more friendly to the planet and to our future, complying with environmental, social and corporate governance factors," said Flavia Santoro, president of ProColombia.

 

Among the commitments assumed by Colombia is the limitation of greenhouse gas emissions by 51% before 2030, to bring illegal deforestation to zero by 2030, as well as the planting of 180 million trees by 2022, among other actions that include sustainable practices in agriculture. In terms of energy transition, it is expected to close next year with 2,800 megawatts of installed capacity of non-conventional renewable energy, which would represent 100 times more than what was in 2018.

 

According to the President of ProColombia, "the country is committed to attracting efficiency, responsible and sustainable investment, as well as adapting our export offer to comply with international standards and guarantee its access to markets that advocate fair trade, and sustainable production practices. And in our tourism axis, we work on the positioning of sustainability as a fundamental pillar for the development of tourism activity, as a factor of competitiveness and social and cultural development; and in compliance with Decree 646 of 2021, which established Colombia's Sustainable Tourism Policy".

 

 

Colombia, leader in BICs in Latin America

 

As a joint effort between the National Government and the private sector, the country has 1,000 companies that have adopted the status of Benefit of Collective Interest (BIC) companies.

These companies comply with sustainable practices in five dimensions: business model, corporate governance, labor practices, environmental practices, and community practices.

Colombia joined this movement with Law 1901 of 2018 and the respective regulation in Decree 2046 of 2019. By 2022 it is expected to reach 1,500 BIC companies in the country.

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