The World Bank revealed its updated economic growth outlook for Colombia and Latin America, which showed mixed trends in the global context. The institution, based in Washington, kept the global GDP growth forecast unchanged at 2.6% for this year and an estimate of 2.7% for 2025. However, the situation presents particular nuances for Colombia and the region. .
In the Colombian case, GDP growth for 2024 is projected at 1.3%, lower than the initial estimate of 1.8% in January, although an improvement is expected in 2025 and 2026 with increases of 3.2% and 3 .1%, respectively. These figures reflected expectations of a recovery in private consumption and a boost in exports. Colombian authorities face a significant challenge: balancing economic growth with financial stability in an environment of high uncertainty.
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The World Bank highlighted that foreign direct investment—one of the most reliable indicators of economic growth—showed signs of recovery in Colombia. The country’s business confidence index has improved notably since November 2023, going from negative -0.5% to positive 1.4% in the most recent report. This increase suggests that companies and investors are beginning to see Colombia as a more attractive place for their investments, which could translate into greater economic dynamism.
However, government debt remains a concern. The World Bank report showed that Colombia’s debt increased from 40.8% of GDP in the period 2010-2019 to 52.5% in 2023. Although this trend is common in the region, it highlights the pressure on public finances. Argentina, for example, faces an even more serious situation, with a debt that exceeds 154.5% of its GDP in 2023, contrasting with the Colombian context.
Regarding inflation, Colombia faces a considerable challenge to achieve the goal of the Bank of the Republic. The current inflation rate is 7.16%, while expectations point to a reduction to 3% by the end of the year, with a margin ranging between 1% and 4.5%. This goal would seem ambitious, given the global economic environment and domestic pressures.
From a regional perspective, Latin America’s economic growth is projected at 1.8%. Although this figure represents a slight increase of 0.2 percentage points compared to the April report, it is still low. High interest rates and the consequent difficulty in attracting foreign capital are factors that limit investment and economic dynamism in the region.
Finally, the World Bank noted that government debt grew in the last decade throughout Latin America. This factor adds a layer of economic complexity to the overall picture, making long-term growth strategies even more difficult for countries like Colombia.
As the next few years progress, The Colombian Government faces the delicate task of managing its public debt, maintaining economic balance and promoting a favorable environment for investments.
The World Bank predicted stability in the growth of the world economy, something that had not been seen in the last three years. According to the entity, GDP growth is expected to remain at 2.6% for the rest of 2024, with a slight rise to 2.7% in 2025.
As for advanced economies, the World Bank projects stable growth of 1.5% in 2024, with an acceleration to 1.7% in 2025. On the other hand, developing economies will see an average increase of 4% during the period 2024-25, a little less than the growth observed in 2023.
Nevertheless, Low-income countries face more significant challenges, according to the World Bank. The external debt of these countries will continue to strengthen, and restrictions on trade exchanges will influence the inflow of foreign capital. In addition, adverse weather events could negatively affect its economic performance.
