Colombians eye central America
Not content with the blossoming pan-Andean financial market, Colombian banks and corporates are looking north to central America for opportunities for growth and as a means to forge a path to the lucrative markets of Mexico and the US.
Colombian entrepreneurs are turning their attention to central America as opportunities in Venezuela dry up. Ten years ago, Venezuela was Colombia’s second-biggest trading partner after the US. However, tensions between the former Colombian president, Alvaro Uribe, and the Venezuelan president, Hugo Chávez, led many Colombian groups to pull back from Venezuela. They turned their sights towards central America, particularly Panama, Guatemala, Costa Rica and the Dominican Republic. The Colombians have invested heavily in financial services and energy in the region.
Today, investment bankers say that there is such strong integration between Colombia and central America that banks that do not have a local commercial presence in the region increasingly regard the Andean and central American region as one.
"It is no exaggeration to say that a single market is developing between the Andean region and central America," says Ricardo De Bedout, country executive for Colombia at Bank of America Merrill Lynch. "Many investment banks that have representative offices in countries in the region increasingly see central America and Colombia as a single market. Culturally, they have a great deal in common and geographically they are in close proximity. Colombian companies have also realized that many industries in central America are under-penetrated and see the opportunities in the region, which they look at as a whole."