THE BOATMAN'S CALL
Though the sector faces challenges caused by the slowdown of international shipping, firms are seeing potential in the FTA with the US and a newly navigable Magdalena river.
Overall, 2013 has proven to be, once again, a difficult year for the shipping industry. There has been a significant lack of growth in the container industry throughout the world since 2008. We are now beginning to understand that this is the new reality of the volume growth of the shipping business. Prior to 2008, the container industry grew at 10% per year. Since 2008, we have been seeing a different kind of trend. There are a number of reasons for this reduced growth, but principally it is due to the fact that China's global sourcing of goods has stagnated, and consequently stagnating container volumes. The FTA with Mexico, as well as those with the US and Chile, has shown that, within five years, there will be a doubling or tripling in the interchange of goods. The US is quicker at reacting and bringing in more imports, but it usually ends up that the exporters are the big winners. About 40% of global consumption is in the US, and I'm sure that Colombia is going to find some way to get a slice of that. Colombia used to export to 70 destinations in the US, but since the FTA this figure has increased to around 500.
Colombia has a range of multi-purpose port facilities. The draft capacity at our ports is greater, and can handle containers, grain, and coal all at one place. All port activities were privatized between 1992 and 1993. Barranquilla is labeled as the capital of the US-Colombia Free Trade Agreement (FTA), and has done an extremely good job, not only in terms of public investment, but also in bridging the gulf between the public and private sectors. The fact is that the market has changed quite considerably for us, and until 10 years ago we were basically the only port in Barranquilla. That is not the case anymore, and we have 25 concessions, eight of which are operational, while three have yet to become efficient enough to run well. The Port of Barranquilla changed hands in late 2012, and the new administration activated major investments in equipment and infrastructure, which are ongoing. We have an investment plan of $180 million, of which we have already invested $85 million.
Colombia has been dreaming of a new navigable river for the past 80 years, although it is clear that the country has prioritized the development of road transportation. Bearing this in mind, we have achieved much over the past two years; we have pursued studies at an international level and are now in partnership with several companies and institutions to open the tender process in 2014. Recovering the Magdalena River for navigation purposes is a huge undertaking in terms of investment and infrastructure. It will help the country to divert road traffic to the water, reducing traffic and accidents on some of the country's main roads. However, the main advantage of this project will be the rise in the competitiveness of local products, as they will be able to reach maritime ports at lower costs, in direct contrast to the high cost of transporting goods from the center of the country to Colombia's Caribbean ports for export. We will have reached our target of 908 navigable kilometers by 2019, with depth and width navigation conditions that will enable us to guarantee the year-round navigation of barge convoys of 7,200 tons.
THE BOATMAN'S CALL
TABLE OF CONTENTS
Inside Perspective
María Ángela Holguín Cuéllar, Minister of Foreign Affairs, Colombia
TBY talks to HE María Ángela Holguín Cuéllar, Colombia's Minister of Foreign Affairs, on the strengths of international alliances, trade relations with the US, and safeguarding the environment for future generations.
read articleInside Perspective
The Right Honorable Nicholas Clegg, Deputy Prime Minister, United Kingdom of Great Britain & Northern Ireland
The Right Honorable Nicholas Clegg, Deputy Prime Minister of the United Kingdom of Great Britain and Northern Ireland, on progress made in a growing bilateral relationship.
read articleFocus: The Valle del Cauca Department
Cali For Ya
The Valle del Cauca, or Cauca Valley, is the country's gateway to the Pacific, boasting the largest port, at Buenaventura. The region's capital, Cali, is also a heavyweight in terms of GDP, yet lingering problems with violence are holding back development
read articleInterview
Martha Juliana Silva Ricaurte, Founder & President, SILK Banca de Inversión
TBY talks to Martha Juliana Silva Ricaurte, Founder & President of SILK Banca de Inversión, on Bogotá's transportation infrastructure, foreign investment in Colombia, and the private equity industry.
read articleInterview
Rodolfo Ramírez, President and General Manager for Colombia & Ecuador, PPG Industries
TBY talks to Rodolfo Ramírez, President and General Manager for Colombia & Ecuador, PPG Industries, on management strategy, competition, and the legal and regulatory framework in Colombia.
read article
