Prepared by: Ralphjersy G.

Almendras

Colombia: A Potential Open Market for Jojo Bragais

Data Source: International Trade Administration (Last Updated: Nov. 24, 2022)

Market Overview
The Republic of Colombia has the fourth largest economy in Latin America, after Brazil, Mexico, and Argentina, and the third largest
population with approximately 51.5 million inhabitants. The country boasts five major commercial hubs [specific places in the country
that hosts commercial offices and establishments that enliven the cities’ finances]: Bogota (Capital and Largest City), Medellin (2nd
Largest City), Cali, Barranquilla, and Cartagena. In contrast to many Latin American countries with only one or two major cities,
Colombia offers U.S exporters access to multiple commercial centers.
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Footwear Trade Value: 260k Dollars (0.83%) Footwear Trade Growth in %: 95.4%
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Footwear Trade Growth in Base Years:

2015-2020
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Import Restrictions and Prohibitions

Items that are restricted and require a special permit include agricultural and vegetable products, hygiene products, tobacco,
medicines (prescription and non-prescription), plant products, plants and seeds, and textile articles. Furthermore, some items are
prohibited. These include alcohol, certain pharmaceutical products and chemicals, used cars, used clothing and accessories, all types
of dangerous residue, and other items.

Customs Clearance
Customs agents in Colombia can examine the goods and open packages if they believe that there is a justifiable reason to do so.
This can cause unexpected delays. Making sure that you possess all the required documentation will lower the chances of delay.

Furthermore, goods which previously weren’t prohibited or restricted can become so, as such changes are far from unordinary.
Weapons and ammunition, explosives, narcotics, and other illegal items are still the primary concern of Colombia’s customs agents.

“Before shipping to Colombia, U.S. exporters should be aware that the U.S. Government may prohibit the export of certain
products or require an export license. The Bureau of Industry and Security (BIS) licenses most controlled exports. Licenses are
required for certain high technology items or technology transfers as well as commercial items which could have military
applications.”

Thus, the same situation may apply to Philippine local brands, and exported materials.

Colombian customs follow the international Harmonized System when classifying imported goods. As well, there are two
categories of customs codes: automatic import licenses and non-automatic licenses.

Customs Duties when Exporting to Colombia

GATT (General Agreement of Tariffs and Trade) is used as a method of evaluating the imported items in Colombia. While
some goods are not taxed at all, and some are taxed at five percent, 19% VAT is standard in Colombia.
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There are three levels of tariffs when it comes to Colombia trade & export. The first one, up to 5%, applies to raw materials,
and industrial and capital goods. The second one, 10%, applies to manufactured goods. The third one, between 15 to 20%, applies
to sensitive and consumer goods.

Import Declaration [International Trade Administration]

The importer must submit an import declaration to the DIAN (Customs). This declaration includes the same information
contained on the import registration form and other information such as the duty and sales tax paid, and the bank where these
payments were made. This declaration may be presented up to 15 days prior to the arrival of the merchandise to Colombia or up
to two months after the shipment’s arrival. Once the import declaration is presented and import duties are paid, customs will
authorize the delivery of the merchandise.

Customs officials are responsible for inspecting merchandise to verify that the description and classification are consistent with
the importer’s declaration. A customs inspection group often performs after-clearance random investigations to detect fraud,
foreign exchange irregularities, and tax evasion. Major customhouse brokers have a customs office in their own bonded
warehouses where most clearance procedures are completed before the merchandise is delivered to the customers.

To carry out an export, the exporter must:

1) Remit the pro-forma invoice,

2) Obtain acceptance of conditions from the client (letter of credit, draft bill),

3) Negotiate (through a local financial institution) the letter of credit/draft bill from the endorsing foreign bank,

4) Present (to Ministry of Commerce, Industry and Tourism) a form known as “Registration as National (local) Producer,
Export Offer and Determination of Origin,”

5) Present the certificate of origin (when necessary) with copy of the commercial invoice, and other certificates required by the
country of destination (textile visa, phytosanitary certificates, etc.), and
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6) Complete and present the export declaration form, also known as shipping authorization of final export declaration, with all
attachments as required.

Products that require special documentation include vegetables, plants, fruits, animals, gold, emeralds, oil, coal, nickel,
platinum, textiles, products exported through the General System of Preferences (GSP), and products exported through any
free trade agreement.

Most of Colombia’s foreign trade procedures have been streamlined through the Unified Portal for Foreign Trade (VUCE), which
gives users access to forms, online payments and follow-up on requests and processes related to an import or export operation.

Business in Colombia: Colombian Company General Steps [Expatgroup.Co]

1. Letter for SPA
2. Naming the business
3. Defining your business’ framework
4. Register with the Colombian Chamber of Commerce and obtain tax identification (NIT)
5. Open a Colombian bank account

Existing Trade Agreements in Force in the Country

• Mexico
Signed: June 13, 1994
Effective: January 1, 1995 • Caribbean Community (CARICOM)
Signed: July 24, 1994
• El Salvador, Guatemala, and Honduras Effective: January 1, 1995
Signed: August 9, 2007
Effective: November 12, 2009 • Chile
Signed: November 27, 2006
• Andean Community (CAN) Effective: May 8, 2009
Signed: May 26, 1969
Effective: October 16, 1969 • EFTA States
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Signed: November 25, 2008 • European Union

Effective: July 1, 2011 Signed: June 26, 2012
Effective: November 5, 2014
• Canada
Signed: November 21, 2008 • Pacific Alliance
Effective: August 15, 2011 Signed: June 6, 2012
Effective: May 1, 2016
• United States
Signed: November 22, 2006 • Costa Rica
Effective: May 15, 2012 Signed: May 22, 2013
Effective: July 29, 2016
• MERCOSUR
Signed: July 21, 2017 • South Korea
Effective: December 20, 2017 Signed: February 21, 2013
Effective: June 30, 2016
• Venezuela
Signed: April 28, 2011 • Nicaragua
Effective: October 19, 2012 Signed: March 2, 1984
Effective: September 2, 1985
• Cuba
Signed: September 15, 2000 • Israel
Effective: July 10, 2001 Signed: June 1, 2017
Effective: August 11, 2020
Colombia officially became a full member of the Organization for Economic Cooperation and Development (OECD) in April 2020.
In its membership commitments, Colombia agreed to focus on reducing informality in the labor market and enhancing worker rights
through working-hour caps and stronger protections for union activists. Colombia is also a member of the World Trade Organization
(WTO). The Colombian Government generally notifies all draft technical regulations to the WTO Committee on Technical Barriers to
Trade. In August 2020, Colombia fully joined the WTO Trade Facilitation Agreement (TFA). Regionally, Colombia is a member of
organizations such as the Inter-American Development Bank (IADB), the Pacific Alliance, and the Andean Community of Nations
(CAN).
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COLOMBIA: COUNTRY SUMMARY [The World Factbook]

Background
Colombia was one of the three countries that emerged after the dissolution of Gran Colombia in 1830 (the others are Ecuador and
Venezuela). Colombia maintains relatively strong democratic institutions characterized by peaceful, transparent elections and the
protection of civil liberties.

Geography
Area
Total: 1,138,910 sq km
Land: 1,038,700 sq km
Water: 100,210 sq km

Climate
Tropical along coast and eastern plains; cooler in highlands

Natural resources
Petroleum, natural gas, coal, iron ore, nickel, gold, copper, emeralds, hydropower

People and Society

Population
49,336,454 (2023 est.)

Ethnic Groups
Mestizo and White 87.6%, Afro-Colombian (includes Mulatto, Raizal, and Palenquero) 6.8%, Amerindian 4.3%, unspecified 1.4%
(2018 est.)

Languages
Spanish (official) and 65 Amerindian languages
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Religions
Christian 92.3% (predominantly Roman Catholic), other 1%, unspecified 6.7% (2020 est.)

Population Growth Rate

0.54% (2023 est.)

Government
Government type
Presidential Republic

Capital
Bogota

Executive branch
Chief of state: President Gustavo Francisco PETRO Urrego (since 7 August 2022); Vice President Francia Elena MARQUEZ Mina
(since 7 August 2022); the president is both chief of state and head of government
Head of government: President Gustavo Francisco PETRO Urrego (since 7 August 2022); Vice President Francia Elena MARQUEZ
Mina (since 7 August 2022)

Legislative branch
Description: Bicameral Congress consists of:
Senate (108 seats; 100 members elected in a single nationwide constituency by party-list proportional representation vote, 2
members elected in a special nationwide constituency for indigenous communities, 5 members of the Commons political party, formerly
the People's Alternative Revolutionary Force (FARC), for 2 legislative terms only: 2018-2022 and 2022-2026 as per the 2016 peace
accord, and 1 seat reserved for the runner-up presidential candidate in the recent election; all members serve 4-year terms)
Chamber of Representatives (188 seats; 162 members elected in multi-seat constituencies by party-list proportional representation
vote, 2 members elected in a special nationwide constituency for Afro-Colombians, 1 member elected by Colombians residing abroad,
1 member elected in a special nationwide constituency for the indigenous communities, 5 members of the Commons political party for
two legislative terms only: 2018-2022 and 2022-2026 as per the 2016 peace accord, 16 seats for rural conflict victims for two legislative
terms only: 2022-2026 and 2026-2030, and 1 seat reserved for the runner-up vice presidential candidate in the recent election; all
members serve 4-year terms)
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Economy
Economic Overview
Prior to COVID-19, one of the most consistent growth economies; declining poverty; large stimulus package has mitigated economic
fallout, but delayed key infrastructure investments; successful inflation management; sound flexible exchange rate regime; domestic
economy suffers from lack of trade integration and infrastructure

Real GDP (purchasing power parity)

$754.645 billion (2021 est.)

Real GDP per capita

$14,600 (2021 est.)

Agricultural Products
sugar cane, milk, oil palm fruit, potatoes, rice, bananas, cassava leaves, plantains, poultry, maize

Industries
textiles, food processing, oil, clothing and footwear, beverages, chemicals, cement; gold, coal, emeralds

Exports
$50.793 billion (2021 est.)

Exports - Partners
United States 31%, China 11%, Panama 6%, Ecuador 5% (2019)

Exports - Commodities
crude petroleum, coal, refined petroleum, coffee, gold (2019)

Imports
$70.84 billion (2021 est.)
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Imports - Partners
United States 27%, China 20%, Mexico 7%, Brazil 6% (2019)

Imports - Commodities
refined petroleum, cars, broadcasting equipment, packaged medicines, corn (2019)

Exchange Rates
Colombian pesos (COP) per US dollar -
3,743.59 (2021 est.)
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References:
• https://www.latinamericancargo.com/exporting-to-colombia-a-trade-and-export-guide/ (May 25, 2020 Updated)
• https://oec.world/en/profile/bilateral-
country/phl/partner/col?depthSelector=HS2Depth&measureBilateralTradeSelector=vizValueOption3
• https://www.trade.gov/colombia-country-commercial-guide (November 24, 2022 Updated)
• https://expatgroup.co/english/business-in-colombia/legal-requirements-for-doing-business-in-colombia/ (April 20, 2022
Updated)
• https://www.cia.gov/the-world-factbook/countries/colombia/summaries