Agriculture, Colombia focuses on the latest generation technologies
With its sustained growth over many years, Colombia has made significant progress in political and social stabilization, with an expansion of the middle class. Agriculture has an important role, able to count on abundant and diversified resources and on many examples of production excellence. Colombia has the potential to become one of the food baskets of the planet
There is a particularly significant date in the history of Colombia. A date that represents, also at a symbolic level, the efforts made by the South American country towards gradual political and social stabilization. That special day is 23 June 2016, when the then Colombian president, Juan Manuel Santos, and Rodrigo Londoño Echeverri, leader of the FARC (Colombian Revolutionary Armed Forces), signed the agreement that led to the peace treaty signed in November of the same year in the Colombian capital. This ended a bloody conflict - often closely linked with the scourge of drug trafficking - which for over fifty years had pit against each other the Bogota government and the main Colombian armed group. The FARC was not the only fighting group in Colombia, but it was the most numerous; at the time of greatest penetration, it numbered 16 thousand men. Fragile and highly complex, even today the path to peace is threatened by a resurgence of political tensions, which are sometimes very violent. These are fuelled by the faction of the FARC opposed to the peace process, and also by the fighters of the National Liberation Army, another armed group active in the country. In short, many obstacles still stand in the way of the actual pacification of the territory. However, as the Farnesina also confirms, these have not prevented Colombia from making considerable progress towards greater political and economic cohesion. This progress is all the more significant given the gradual deterioration of the institutional framework of many countries in South America, from Bolivia to Argentina, from Chile to Peru. Venezuela is where these tensions have exceeded the safety threshold, with a growing risk of an armed conflict. The Venezuelan chaos has also affected Colombia, where - from 2014 until today, according to UN data - more than a million refugees have taken refuge.
The “China” of South America
In such a fragile geopolitical context, characterized by vulnerable economies particularly exposed to recession, Colombia has always stood out for its marked economic dynamism. Between 2010 and 2018, states a note from the ICE Agency, the GDP of Bogota grew at an average annual rate of 3.7%, placing the country in the 32nd position in the ranking of the major world economies. This is all the more surprising if we consider that the last GDP setback, with a drop of four percentage points, dates back to 1999. The expansion cycle, also favoured by the many free trade treaties signed by Bogota, has been accompanied in the past six years by an improvement in socio-economic indicators. Between 2013 and 2018, as the World Bank notes, the poverty rate fell by 3.5 percentage points, and the infant mortality rate from zero to five years fell by 2 percentage points. The rate of malnutrition also decreased considerably: from 2013 to 2018, according to FAO, more than one million people have come out of a state of food insecurity (Bogota is in first place in South America for food sustainability). Over this same period, the progress made by Colombia to emancipate the population from poverty is also evidenced by the increase in life expectancy (from 76 to 77 years) and an increasing rate of secondary education. According to estimates by the ICE Agency, by 2025 the middle class will account for 46% of the population (+9% compared to today), with a growing weight and role in Colombian society.
The “green gold” of Colombia
Oil, of which Colombia is the 18th world producer, construction, textile, chemistry, clothing and food are the driving sectors of an economic system with a GDP highly specialized in services (62%) and industry (31%). However, the great strength of the Colombian economy are the examples of environmental excellence. Favoured by a very advantageous geographical position - the country is bathed by two oceans and is a few hours’ flight from the main destinations of North and South America - the country has abundant and diversified resources, and is characterized by a rich and varied agriculture. For this reason, FAO regards Colombia as one of the seven potential granaries on the planet. Out of 43.1 million hectares (equal to 38.6% of its surface) used for agriculture, 80% is used for breeding while the remaining 7.1 million are allocated to crops. Of these, only 5.1 million hectares are actually cultivated. In short, there are wide margins for the productive enhancement of the agricultural sector, which already has many strengths. Currently, the largest portion of agricultural land (2 million hectares) is dedicated to agro-industrial crops such as coffee (of which Bogota is one of the main world producers), sugar cane, palm oil and soybeans. Grains (especially rice and maize) and tubers, on the other hand, grow on an area amounting to 1 million and 498 thousand hectares respectively, while fruit occupies 450 thousand hectares for a total production of 4 million tonnes.
Tractors and machinery, Colombia focuses on innovative means
In the Colombian primary sector, the pulverization of agricultural property prevails. Out of over 2 million active farms, the vast majority - more than 90%, reports the ICE Agency - are sole proprietorships. Legal entities represent just 1% of the total. Such a dramatic production fragmentation represents a clear obstacle to investments in agricultural machinery. Out of 43 million hectares - underlines the Colombian press - just 16% have mechanization levels in line with the cultivation needs. “The deficit in agricultural means is very significant and not all people have the possibility of using machines or systems for irrigation”, said Rafael Mejía, president of SAC, one of the farmers’ trade associations. The government responded to this gap with the plan called Pectia, a platform structured on several levels - political, technological, scientific - aimed at stimulating innovation, technical progress and competitiveness in the primary sector, especially in the phases ranging from crop management to product processing. The particularly important areas of intervention identified by the platform include the development and implementation of technologies for the quality of agricultural products and the correct sanitary and plant protection management of crops. The plan therefore sets the conditions for an increase in the demand for agricultural machinery, a demand that is primarily met today on foreign markets. “In 2018 Colombia imported machinery for 101.6 million USD, and there is a growing dynamism in the import market, with an average annual growth of 33% between 2016 and 2018. This growth rate - we read in the ICE Agency’s industry note - largely exceeds the overall growth of all Colombian imports (4%)”. The main suppliers to the South American country include Brazil and the United States (2018 data that does not consider technologies for livestock and the dairy industry), with exports valued at 41 and 11 million respectively. China follows with 9.5 million, Mexico with 9, and Japan with 8.5. In a more modest position, in 2018 our country exported machinery for 2.6 million euros; in this sector, it is Bogota’s leading European partner. Irrigation systems (873 thousand euros), scarifiers and motor hoes (319 thousand euros), and tillers (292 thousand euros) are among the most requested machinery from Italian manufacturers. It should be noted that in the last three years, Italian exports to Colombia have been fluctuating, with a considerable increase in 2017, followed by a sharp drop in 2018. Together with the “made in Italy” products, this dynamic has also affected other suppliers to the South American country. Despite these fluctuations, the agricultural machinery sector has good growth potential, especially in the medium and long term, riding the wave of the modernization policies launched by the executive. In short, Italian manufacturers have everything they need to increase penetration in the sector. After all, Italian industries are already moving in this direction, as demonstrated by the strong relations with the Colombian production world and the presence at the country’s main trade shows. The latest one, Expo Agrofuturo, took place in Medellin last September, with the participation of 36 Italian companies under the aegis of the ICE Agency and FederUnacoma.
