IT'S NOT MAGIC
A reputation for violence had for many years stunted the growth of Colombia's tourism sector. But now that the country has enormously improved its image abroad, there is little to prevent it from becoming one of the most ideal destinations in Latin America.
In 2015, the Colombian Ministry of Industry and Tourism debuted its rebranding. With the tagline “Colombia is Magical Realism," the ministry sought to channel its most famed contribution to world literature, Gabriel García Márquez, and the fact that its charmed culture, landscapes, architecture, and cuisine do indeed come to life. The ministry has a plan to considerably boost the tourism industry before the end of the decade, with specific aims to grow the industry by 15%, equating to $6 billion in tourism revenue and generating some 300,000 new direct and indirect jobs. By working to ensure the stability of the sector, Colombia's extremely diverse cultural offerings are sure to lay the foundation for continued and sustained growth.
The tourism sector plays a significant role in the country's economy. In 2015, the total contribution of the sector to GDP was just over $17 billion, accounting for 6.1% of GDP, according to the World Travel and Tourism Council (WTTC). With a projected growth rate of 1.4%, that number is expected to be $17.5 billion in 2016, making up a slightly lower portion of GDP, at 6%. The WTTC expects a steady increase in the sector's contribution over the next 10 years to 2026, with a forecasted rise of 3.8%, bringing its contribution to GDP to $25.4 billion, contributing 6.1% to the total.
While leisure tourism constituted the majority of the sector's contributions to the GDP, business travel played a significant role. According to WTTC data, in 2015, leisure travel spending accounted for 78.6% of the sector's total contribution to GDP, or some $9.5 billion, whereas business tourism made up the remaining 21.4% and accounted for $2.6 billion. In 2016, leisure spending is forecasted to increase by 4.3%, generating some $9.9 billion, while business tourism spending is in fact expected to drop by 3% to $2.5 billion. The WTTC's projections for 2026 give leisure travel in the country a per-annum increase of 3.3%, reaching $13.6 billion, and a business spending increase of 5.4% per annum to contribute $4.2 billion by 2026.
The industry also plays an important role for domestic employment, as foreign visitors utilize hotels, airlines, and other transportation, as well as travel agents, among a score of other services. In 2015, the sector directly created 556,000 jobs, representing 2.5% of total employment, according to the WTTC. This number is expected to grow by 0.7% in 2016, bringing the number up 4,000 to 560,000, but not making a significant impact on total employment. By 2026, the WTTC reports, the industry will directly provide some 626,000 jobs, increasing by 1.1% over the next decade. In total, the sector accounted for 1.4 million jobs in 2015, or 6.3% of total employment. For 2016 that figure is not expected to fluctuate, but by 2026 the contribution is expected to create 1.6 million jobs and account for 6.4% of total employment, growing at 1% per annum.
According to the Ministry of Industry and Tourism, the US accounted for the most visitors to the country from January to June of 2016, making up over 21% of total visitors, or some 251,380. Other popular countries of origin for visitors included Venezuela, Brazil, and Ecuador. Among the top 10, the only source country not located in the Americas was Spain, which fell in last place. Compared to the first six months of 2015, January to June of 2016 saw a 10% decrease in the number of arrivals, equating to almost 230,000.1
According to the ministry, during the first half of 2016 compared to the first half of 2015, the department with the greatest increase in tourist arrivals was the Department of Antioquia, which saw an increase in arrivals by 48.5%. Antioquia is located in the northeast of the country, with a small strip of land along the Caribbean Sea. However, it is not the Caribbean beaches that are the primary attractions to the city, but rather what is commonly referred to Colombia's most favored city: Medellín. While the city was considered one of the most dangerous in the world as recently as the 1990s, security has improved considerably in recent years and is becoming a favored city in the country for tourists, perhaps due to its infamous former residents. The city is famed for its annual Festival of the Flowers, which celebrates events like the independence of Antioquia and the abolition of slavery. The city is served by Jose Maria Cordova International Airport and is home to the country's only metro system.
Colombia has a small but budding cruise industry. As of June, almost 125 cruise ships had stopped at a Colombian port, bringing with them over 173,000 passengers, according to the tourism authority. The most popular means of arrival is by air travel, and, unsurprisingly, Bogotá's El Dorado International Airport was the country's busiest between January and June of 2016, with 1.77 million arrivals, representing 65.7% of total arrivals and a 3.1% increase YoY. The second most popular airport is Medellín's Jose Maria Cordova, which saw 357,000 arrivals, considerably less than Bogotá, representing only 13.3% of all arrivals, but an increase of 26.7% from the same period the previous year. The most popular origins for international flights were Panama City with 410,102 passengers, Miami with 259,500, Lima with 134,341, and Madrid with 125,586.
According to the Hotel and Tourism Association of Colombia (COTELCO), from January to June 2016, the average hotel occupancy rate in the country was 48.8%, representing only a 0.6% increase from the same period in 2015. This rate is not very representative of certain parts of the country, however; in the Department of San Andres y Providencia, which accounts for the country's two islands near the coast of Nicaragua in the Caribbean Sea, hotel occupancy for the same period of time was 80.5%, the highest in the country. In Antioquia, hotel occupancy was 70%, the second-highest occupancy rate in the country and representing an 11% increase from January to June in 2015. The third most-occupied department in the country was Bolívar, with a rate of 48.6%, according to COTELCO.
While the country's reputation as a vacation destination has grown in recent years, it has for some time been a popular spot for medical tourism. While in the early days of its medical tourism industry the country was popular for cosmetic surgery as a means of rounding things out, today the country is home to a score of highly skilled and highly accredited medical professionals and facilities. Cosmetic surgery and dentistry remain among the most popular procedures; however, Colombia is known in the region for having one of the most advanced medical care systems that frequently and successfully performs some of the most state-of-the-art operations and surgeries, all at a fraction of the cost as compared to some North American and European countries.
IT'S NOT MAGIC
TABLE OF CONTENTS
Interview
Bruce Mac Master, President, National Business Association of Colombia (ANDI)
TBY talks to Bruce Mac Master, President of the National Business Association of Colombia (ANDI), on tackling obstacles to competitiveness in the economy, participating in the global value chain, and the impact of the currency devaluation.
read articleFocus: Bank Expansion Abroad
Fortune Favors the Brave
Colombian banks have greatly expanded their operations in Central America in the last decade. The dramatic growth of the middle class and the internationalization of the Colombian economy has propelled growth. The market has shaken the shackles of the large players who used to dominate the market, with smaller institutions expanding and widening their coverage across the region.
read articleInterview
Mauricio De La Mora Rodríguez, Former President, National Hydrocarbons Agency (ANH)
TBY talks to Mauricio De La Mora Rodríguez, Former President of National Hydrocarbons Agency (ANH), on promoting investment, gaining knowledge of offshore activities, and the short-term outlook.
read articleInterview
Eduardo Jaramillo Cuervo, President & CEO, General Electric (GE)
TBY talks to Eduardo Jaramillo Cuervo, President & CEO of General Electric (GE), on the role GE intends to play in developing Colombia's energy value chain and creating a diversified matrix to support the country's energy needs for years to come.
read articleInterview
Adriana Lucia Falla, General Manager, SoftManagement S.A
TBY talks to Adriana Lucia Falla, General Manager of SoftManagement S.A., on the important elements of the company's business, its key strengths compared to its competitors, and the significance of the IT sector in Colombia.
read articleInterview
Juan Martin Caicedo Ferrer, Executive President , Colombian Chamber of Infrastructure (CCI)
TBY talks to Juan Martin Caicedo Ferrer, Executive President of the Colombian Chamber of Infrastructure (CCI), on the future of infrastructure in the country, challenges, and the role of SMEs.
read articleFocus: 4G Generation
Motoring Toward Development
Colombia is looking toward the future and improving its transportation network by renewing road infrastructure, putting an end to the nation's underdevelopment in roads and highways. The government estimates that in the next four years the 4G program will dramatically enhance the Colombian economy, shortening traveling time between cities and, consequently, reducing transportation costs.
read articleFocus: Coffee
Morning Joe
Colombian coffee has an incredible reputation for its aroma, taste, and purity, which is why it is considered one of the best quality coffees in the world. This belief has not changed despite the entrance of huge producing countries such as Ethiopia, Brazil, and Vietnam into the market.
read articleReview: Education
Gold Star For You
In recent decades, Colombia made changes to nearly every level and aspect of its education system and has been exceeding the expected results, putting the country on the right track to achieve the president's goal of becoming the best educated country in the region.
read articleReview: Tourism
It's Not Magic
A reputation for violence had for many years stunted the growth of Colombia's tourism sector. But now that the country has enormously improved its image abroad, there is little to prevent it from becoming one of the most ideal destinations in Latin America.
read article
