Colombia has been proactive in pitching nearshoring opportunities to international companies willing to consider relocations of Asian operations to Latin America as global value chains adjust to the Covid-19 shock. The country launched an investment relocation strategy that met the principles of the US ‘Back to the Americas’ initiative, thus giving the government a chance to strengthen the bond with Washington, while identifying and engaging with some 68 companies possibly interested in relocating to the country, José Manuel Restrepo, Colombia's commerce, industry and tourism minister, tells fDi.
What is the main objective of the investment relocation strategy?
The strategy wants to address a phenomenon that we have been witnessing in recent months: the disruption of global value chains. Within this context, the opportunity for companies from the US, as well as Europe and certain Asian countries, to relocate some of their Asian operations to Colombia can be attractive. That is also what stirred the interest of the US, who have proposed us to become a leading country in the so-called ‘Back to the Americas’ initiative.
What have been the results so far?
First we identified some 650 companies with potential for relocation. Then we refined that number down to 68 companies that would benefit the most from a relocation to Colombia. We have been approaching them and stirring their interest, and already there are a few that are in advanced talks with regards to the sectors and regions they would be interested in investing in Colombia. Specifically, there are 13 that might be interested, another 17 that have already asked for more information, 24 that have developed an agenda of meetings and 14 that are just about to take an investment decision.
What type of companies are they?
They represent mostly the agribusiness industry (food processing), industry 4.0 activities — particularly those more related to services — metalworking and construction materials, chemicals, pharmaceuticals and life sciences, as well as a few companies from fashion and information technology.
What is their interest in Colombia?
They want to use the country as an export hub, which is an appealing proposition also thanks to the country’s 17 free trade agreements (FTAs), including a solid FTA with the US, but also cater to its internal market. They see the opportunity of turning Colombia into a key link in the development of regional value chains. Besides, they acknowledge the value and the level of commitment of our human capital.
What is the relationship between your relocation strategy and Washington’s ‘Back to the Americas’ initiative?
It’s a happy coincidence that fits the country’s overall strategy of attracting investment to Colombia and, during the visit of secretary of state Mike Pompeo, we agreed to make Colombia a testbed for the ‘Back to the Americas’ initiative. Overall, it’s an opportunity to strengthen our relationship with the US, which traditionally has been our main trade and investment partner. At the same time, our relocation strategy is not limited to US companies: we want to attract firms from all over the world in order to, eventually, generate new resources and jobs for the country.
How do you assess the rise of Mauricio Claver, the mastermind of the ‘Back to the Americas’ initiative, to the presidency of the Inter-American Development Bank (IDB), the first US citizen to rise to a position that had been traditionally reserved to representatives of Latin American countries?
Colombia was among the first countries to support his candidacy. We see him as an ally to the region, and someone with the knowledge and capacity to fill the role.
This article first appeared in the October/November print edition of fDi Intelligence. View a digital edition of the magazine here.