For nearly a decade, Colombia, to the outside world — specifically the United States — has been getting an undeserved bad rap as a result of its checkered past vis-à-vis the presence of narco-traficantes, corruption, poverty and (illegal) opportunity.
Almost single-handedly, Pablo Escobar became the face of the enemy of the war on drugs and was the symbol by which Colombia has been (unfortunately) associated with since the 80s and 90s. To this day, Colombia is still plagued with this unfortunate reputation.
For a country as rich in hospitable citizens, cultural diversity, natural resources and geographic centricity in the western hemisphere, Colombia has been a quietly growing giant to the rest of the world for the past 10 years. It was the only country in Latin America named as part of CIVETS (the “successor” to the BRIC designation, representing Colombia, Indonesia, Vietnam, Egypt, Turkey and South Africa as coined by Robert Ward, the global forecasting director for the Economic Intelligence Unit). Unfortunately for Colombia, it was not included in the Next Eleven designation (N-11), as identified by Goldman Sachs investment banker and economist Jim O’Neill, where he marked Bangladesh, Egypt, Indonesia, Iran, Mexico, Nigeria, Pakistan, the Philippines, Turkey, South Korea and Vietnam as the next wave of emerging global participants. These lists are hotly debated and often used in helping push for trade-policy reform and access to global capital markets — both Colombia and Mexico remain the only two countries identified in either list since BRIC was first coined in 2001 by Mr. O’Neill.
On the heels of a recent trip to Colombia, I found the country still in the midst of a hotel building boom, fueled by a confluence of political, economic and social efforts that have put the country on an exciting trajectory.
With a ratified free trade agreement in place for approximately 18 months, a continued bevy of investment incentives for hotel developers/investors and easing travel restrictions/warnings combined with low-cost carriers such as JetBlue and Spirit Airlines serving multiple destinations from U.S. points of entry, the Colombian hotel building boom has been focused on internationally recognized select-service brands.
The country risk is certainly waning, the security issues are more perceived than real, the multitude of offerings throughout distinct tourism and commercial hubs are growing and Americans, above the rest, are coming around to the idea of finding a new market with which to mix business with pleasure. The changing of the guard in Colombia is well on its way, and it would be a pity for a country with such a remarkable upside to be weighed down by a past that has haunted global capital markets and governmental offices around the world.
In my next post, I will present more concrete examples of opportunities in the hospitality space in Colombia.