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                     Key Economic Indicators
        (Millions of U.S. dollars unless otherwise noted)

                                    1992      1993 1/   1994 /2

Income, Production and Employment:

Real GDP                          23,626    24,872    26,115
Real GDP Growth (pct.)               3.8       5.3       5.0
GDP (at current prices)           45,358    49,396    54,443
By Sector:
  Agriculture                      7,111     6,933     7,501
  Energy/Water                     1,210     1,580     1,741
  Manufacturing                    8,814     9,127     9,941
  Construction                     2,577     2,985     3,342
  Rents                            3,214     2,976     3,392
  Financial Services               5,195     5,799     6,386
  Other Sectors                   17,238    19,996    22,140
Real Per Capita GDP
  (at current prices)              1,307     1,431     1,562
Labor Force (000s)                11,300    11,500    11,700
Unemployment Rate (pct.)            10.3       7.9      10.0

Money and Prices annual percentage growth

Money Supply (M2: an. pct. gwth.)   39.4      31.7      28.0
Base Interest Rate (pct.)           37.2      35.8      38.0
Personal Savings Rate (pct.)         7.5       7.0       6.5
Retail Inflation (pct.)             25.1      22.6      22.0
Wholesale Inflation (pct.)          17.9      13.2      18.0
Consumer Price Index               268.1     325.7     397.7
Exchange Rate (USD/Peso)
  Official                         811.8     917.3     988.0
  Market Rate                      738.0     802.7     865.0

Balance of Payments and Trade:

Total Exports (FOB)                6,909     7,111     8,333
  Exports to U.S.                  2,466     2,641     3,833
Total Imports (CIF)                6,513     9,841    10,609
  Imports from U.S.                2,434     3,469     3,712
Aid from U.S.                       48.5        16         1
Aid from Other Countries             N/A       N/A       N/A
External Public Debt              13,601    13,206    12,600
Debt Service Payments (paid)       3,451     3,141     3,667
Gold and Foreign Exch. Reserves    7,728     7,932     8,381
Trade Balance                        396    -2,730    -2,275
  Trade Balance with U.S.             32      -828      -879

N/A--Not available.

1/ Preliminary.
2/ Data for 1994 are estimates based on latest reports from
Colombian Government sources.
3/ U.S. aid is for fiscal years 1992, 1993 and 1994.

1.  General Policy Framework

    The Administration of President Ernesto Samper took office
in August 1994, following the four-year term of President Cesar
Gaviria.  The Gaviria Administration was responsible for a
profound economic liberalization program known as "apertura." 
That program made great strides in opening the Colombian
economy to international trade and investment by reforming
foreign exchange and tax legislation, the labor code and the
foreign investment regime.  In addition to slashing tariffs
from an average of 42 percent in 1990 to 12 percent in 1992 and
eliminating many nontariff barriers, apertura also led to great
strides in the privatization of state enterprises such as ports
and railroads.  Although President Samper has said he will take
no backward step in the apertura process, he will try to reduce
some of the economic dislocations, especially in agriculture,
caused by the rapid economic policy changes.  Colombia has
ratified the Uruguay Round agreements and became a founding
member of the World Trade Organization (WTO) on January 1,

    Concurrent with the economic reform program, the Colombian
government has continued its policy of gradually reducing
inflation.  Inflation, as measured by the CPI, was brought down
to 22.6 percent in 1993; it was 32.4 percent in 1990. 
Government economists forecast that the inflation rate will be
between 21 and 22 percent in 1994.  The CPI has not dropped
more quickly in recent years primarily because of inflationary
pressures stemming from the strong inflows of foreign capital,
the policy of indexing the wages of Colombian workers, and the
desire of the government to avoid the adverse impact on the
economy a shock treatment would have.

    In 1990 and 1991 the government resorted to restrictive
monetary and fiscal policies to cope with inflation.  In late
1991 monetary policy was directed at overcoming the effect of
large inflows of foreign capital while maintaining the
stability of the peso.  Monetary policy in the period between
1990 and 1992 was impacted by developments in the foreign
exchange sector.  The high domestic interest rates caused by
restrictive monetary policies boosted the expected yield from
Colombian assets.  The large capital inflows that followed
would have caused the money supply to increase, complicating
monetary policy, if the Central Bank had not taken action. 
That action came in the form of a June 1991 decree mandating
that foreign exchange receipts would be redeemed for exchange
certificates, denominated in U.S. dollars.  Government
authorities also increased the tax on unilateral transfers of
foreign exchange to residents of Colombia from abroad to 10
percent in mid-1992.

    The exchange certificate system was discontinued in January
1994.  In March 1994 the Central Bank announced regulations to
limit internal and external credit availability to private
Colombians.  The measures were aimed at reducing inflationary

    Monetary policy in the Samper government will be aimed at
the further gradual reduction of inflation while avoiding
abrupt movements in the exchange rate of the peso.  The Samper
administration is sympathetic to complaints by Colombian
exporters that the strong peso has adversely affected the price
competitiveness of Colombia's exports, especially
nontraditional exports.  Days after President Samper took
office the Central bank amended regulations to discourage the
public and private sectors from incurring more short-term debt
in foreign currencies.

    Colombia's fiscal policy over the last four years has been
designed to achieve four principal objectives:  (1)  the
establishment of a macroeconomic foundation for sustainable
growth, (2)  the direction of public resources to those sectors
of the economy which can best support the social development
and competitiveness of the nation, (3)  the restructuring of
the budgetary system to increase constitutionally-mandated
transfers to states and municipalities, and (4)  the decrease
in reliance on import tariffs as a source of revenue.

2.  Exchange Rate Policy

    In January 1994 the Central Bank moved to free market
exchange rates for Colombia's peso.  Since that time the daily
quotation is set by the Banking Superintendency, and is based
on quotations from certain commercial banks and financial

    Colombia's exchange rate policy underwent significant
reforms following the introduction of the apertura program in
1990.  In 1991 Colombian residents were permitted to hold
foreign currency and maintain foreign bank accounts. 
Furthermore, the Central Bank relaxed the total control over
the foreign exchange regime it had exercised; the primary aim
was the development of a foreign exchange system governed by
market forces.  Also, the crawling peg system, introduced in
1967, was replaced by a floating rate system under the control
of the Central Bank.

    In September 1993 the foreign exchange system was further
liberalized by the introduction of streamlined administrative
procedures and the reduction of the number of transactions that
had to be done through commercial banks or other sanctioned
intermediaries.  In January 1994 the Central Bank moved to the
free market exchange system in which the peso may move within a
band 7.5 percent above or below the daily quotation.    The
Central Bank may intervene by buying or selling its instruments
in order to keep the currency within the band.  The strength of
the peso in recent years has improved price competitiveness of
U.S. exports to Colombia and has resulted in a significant
shift in the balance of bilateral trade.

3.  Structural Policies

    Taxes:  Part of the apertura program consisted of the
reform of Colombia's tax system.  Tax reform legislation passed
in 1990 and 1992 reduced the dependence of the central 
government on import tariffs as a source of revenue.  As a
result, import tariffs fell from 42 percent in 1990 to 12
percent in 1992 while the VAT increased from 10 percent to 14
percent in the same period.  The Colombian government imposes a
"war tax" on producers of crude oil and minerals, two sectors
with heavy foreign participation.  Tax collection showed
improvement in recent years because of better enforcement and
administrative changes (i.e., introduction of simpler forms and
permitting taxpayers to make payment at local bank branches).

    Privatization:  The Colombian government initiated an
ambitious privatization plan beginning in 1991.  Since that
time the nation's ports, its railroad system, cellular
telephone service and domestic long-distance service, five
banks, eight chemical firms, three shipbuilding companies, six
agroindustry enterprises, a fishing company, and a retail
gasoline chain, among others, have been sold to private
owners.  In early 1994 a court decision made it mandatory that
all shares of firms being privatized thereafter must be offered
first to the employees of those firms and to such institutions
as pension funds, cooperatives, and unemployment funds.

    Regulatory Policy:  Performance requirements exist in the
automotive assembly sector in the form of local content
requirements, as outlined in Decree 2642 of December 23, 1993. 
This decree requires the following local content: passenger
vehicles carrying up to 16 persons and cargo vehicles up to
10,000 pounds, 30 percent; all other vehicles, 15 percent.

    Government Procurement:  Government procurement is subject
to the norms established by Law 80 of October 1993.  Certain
articles contained in the legislation have been problematic to
potential foreign investors, including some U.S. companies. 
Article 20 of Law 80 requires that foreign firms without an
active local headquarters document that Colombian companies
enjoy reciprocity in similar bids under the foreign firms'
countries' procurement legislation.  The law suggests that
reciprocity be confirmed through bilateral or multilateral
treaties or accords, or that it be certified by an "authorized"
government entity.  The American Embassy has been in contact
with the Colombian government to attempt to find a mutually
satisfactory resolution to these issues.  However, no
resolution had been reached as of late December 1994.

4.  Debt Management

    The Colombian Government continues to pursue ambitious
structural economic reforms to stimulate real growth,
strengthen its external sector, and enhance the country's
access to new sources of credit.  The debt management strategy
is aimed at accessing new sources of credit in the external and
domestic capital markets and on improving the debt profile of 
the country generally.  The government used the proceeds of
external bond sales in 1992, 1993 and the first nine months of
1994 to prepay approximately $1.8 billion of debt.  At the end
of 1993 Colombia's long term and medium term public and private
debt was $17 billion, equivalent to 34 percent of GDP.

    The Samper administration has announced that it will
continue the orthodox management of Colombia's foreign debt 
pursued by the previous government.  The administration's main
debt-related objectives include obtaining a better rating for
Colombian securities and increasing exposure with multilateral
banks.  The latter objective is being sought to provide
priority financing for social programs and infrastructure
improvements that are key elements of Samper's development

    The government also intends to continue to reduce the
burden of external debt service by keeping the growth of
indebtedness below GDP growth.  The government will also
continue to broaden its access to funds in money markets in
Europe, Japan, and the United States.  In September 1994 the
Colombian government placed $175 million in five-year "Yankee
Bonds" in the United States market (at 1.6 points over Libor). 
That made $425 million placed in the United States during the
first nine months of 1994.  Colombian financial authorities
will continue to seek funds under the most favorable terms in
the world's largest markets.

5.  Significant Barriers to U.S. Exports

    Import Licenses:  Colombia's prior import licensing
requirement was formerly the country's most onerous import
restriction.  In 1991 the government abolished nearly all prior
import requirements.  Some 98 percent of tariff categories can
now be imported freely, requiring only prior registration with
the Colombian Trade Institute (Incomex).  The remaining two
percent of product categories still subject to prior import
licensing include chemicals which could be used to manufacture
cocaine, arms, and munitions.  Imports by government entities,
donations, and nonreimbursable imports also require prior
licenses.  The impact of import licensing requirements on U.S.
exports is minimal.

    Banking and Securities:  Law 9 and Resolution 49 of 1991
opened up Colombia's financial sector to foreign investment. 
This legislation permits foreign investors to own up to 100
percent of financial institutions.  There were two wholly-owned
U.S. banking subsidiaries operating in Colombia in October
1994.  A third is expected to commence operations before the
end of 1994.  U.S. companies in the Colombian banking and
security sectors receive full national treatment.

    Legal:  The provision of legal services is limited to those
licensed under Colombian law.  Foreign law firms are not
permitted a commercial presence in Colombia.

    Insurance:  A commercial presence (i.e., a registered place
of business, a branch or an agent) is required in order to sell
policies other than those for international travel or
reinsurance.  Colombia permits 100 percent foreign ownership of
subsidiaries, but the establishment of branch offices of
foreign insurance companies is not allowed.

    Accounting and Auditing:  Some restrictions exist because
the firms which control 80 percent of the market are
subsidiaries of multinationals.  Providers of these services 
must be licensed in Colombia.  However, services offered by tax
and administrative consulting firms or individuals are not

    Mining and Hydrocarbons:  Petroleum and mining companies
have expressed concern about restrictions on the use of local
versus expatriate personnel, especially during the start up
phase of a project.  Colombian law requires that, unless an
exemption is granted, at least 80 percent of employees be
Colombian nationals.

    Information Processing:  Commercial presence is required to
provide this service.

    Advertising:  At least 50 percent of programmed advertising
must have local content.  However, this applies only to public
broadcast network programming.

    Audiovisual Services:  Public network programming limits
foreign air time to 40 percent of the total.

    Standards, Labeling, and Marking Requirements:  The
Colombian Foreign Trade Institute (INCOMEX) does not require
specific technical standards for any products.  However,
specifications established by the Colombian Institute of
Technical Standards (ICONTEC) apply to Colombian government
imports made pursuant to international bids.  The Colombian
Import Code states a preference, but not a requirement, that
imports be described in metric system terms.

    Specific marks or labels are required only for
pharmaceutical and food products.  Labels on food products must
indicate the specific name of the product, ingredients in order
of content, the name and address of the manufacturer, and the
total contents.  No label or illustration may be inaccurate or
misleading in any way.  Pharmaceutical products must bear a
label, in Spanish, stating "for sale under medical, dental or
veterinary prescription," the generic and brand names of the
product, the net weight or volume of the package, the weight or
quantity of active ingredients, the product's license number,
and the lot control number.  Products with limited shelf life
must indicate the product's expiration date.

    Investment Barriers:  Foreign direct investment policies in
Colombia are guided by two principles:  (1) equality, in the
sense that foreign and national investors receive the same
legal and administrative treatment; and (2) openness, meaning
that few restrictions will be imposed on the value of foreign
direct investment or its destination.

    Law 9 of 1991, Resolutions 51, 52, and 53 of the Council of
Economic and Social Policy (CONPES) and Resolution 21 of the
Board of Directors of the Central Bank are the principal
regulations which govern foreign direct investment.  These
resolutions grant national treatment for foreign direct
investors and permit 100 percent foreign ownership in virtually
all sectors of the Colombian economy.  The few exceptions
include ownership of real estate, activities related to the
national security, and the disposal of hazardous waste.

    Investment Screening:  Investment screening has been
largely eliminated, and those procedures still in place are
generally routine and nondiscriminatory.  Prior approval by the
National Planning Department for foreign direct investment is
required only if the investor is providing a public service
(energy, water, communications, etc.), requesting coverage by
international insurance or risk protection (i.e., OPIC) or
investing more than $100 million in activities related to
mining, smelting, refining, transportation, or distribution. 
The Ministry of Communications must approve foreign direct
investment in that sector and the Ministry of Mines and Energy
must approve all investment dealing with hydrocarbons.  All
foreign direct investment must be registered with the Central
Bank's foreign exchange office within three months of start up
in order to obtain permission to repatriate earnings.  Finally,
all foreign direct investment must obtain an operating license
from the Superintendent of Companies and must be registered
with the local Chamber of Commerce.

    Customs Valuation:  Establishing the value of imported
merchandise, previously performed only by customs officials, is
now done in many cases directly by the importer.  The importer
declares the value of the import and pays the corresponding
tariff and other taxes at a commercial bank.  Customs
clearance, which frequently took months under the former
system, can now be completed in a few hours.

    Customs officers inspect merchandise on a random basis to
verify that description and classification conform to the
importer's declaration.  A program is also being implemented
for major customs brokers which provides them with a computer
terminal linked to the computer network operated by the Bureau
of Customs.  Brokers with these terminals can complete most
clearance procedures in their offices before picking up the
merchandise at the port of entry.

6.  Export Subsidies Policies

    The Colombian Government has sharply reduced export
subsidies.  At present there are three types of export
incentives:  (1) indirect tax rebate certificates of 2.5
percent, 4 percent and 5 percent, (2) import duty exemptions on
the import of capital goods and raw materials used to
manufacture goods that are subsequently exported, and (3)
export credits provided by the Colombian Bank of Foreign
Trade.  The overall effect of these programs has diminished
considerably following Colombia's accession to the GATT
Subsidies Code.

7.  Protection of U.S. Intellectual Property

    Colombia continues to improve protection of intellectual
property rights through Andean Pact Decisions.  Colombia
remained on the Special 301 Watch List in 1994 due to
continuing concerns over deficiencies in the patent regime and
copyright enforcement efforts.  Enforcement concerns arise not
only at the police level, but also in the juridical system. 
Several private attorneys have commented on the lack of respect
for preservation of evidence and frequent instances of
perjury.  Colombia is a member of the Convention establishing
the World Intellectual Property Organization.

    Patents:  Andean Pact Decision 313 of 1991 provides patent
protection for most products, including pharmaceuticals,
biotechnology, and plant varieties.  (Only pharmaceuticals on
the World Health Organization list of "essential medicines" are
excluded.)  In 1993 the Andean pact adopted Decision 344, which
represented a significant improvement over previous standards
used for the protection of industrial property.  For example,
it provided for a 20-year patent protection term beginning with
the filing date.  However, the decision still falls short of
U.S. goals in several respects, and is inconsistent with
several provisions of the recently concluded agreement on Trade
Related Aspects of Intellectual Property (TRIPs) in the Uruguay
Round and the Paris Convention for the Protection of Industrial
Property.  For example, the compulsory licensing authority is
inconsistent with TRIPs and no pipeline protection exists. 
Colombia also adopted Andean Pact Decision 345, which provides
protection to certain plant varieties.

    Colombia has not joined the major international conventions
on patent protection.  However, the government has stated its
intention to sign the Paris Convention for the Protection of
Industrial Property, the Patent Cooperation Treaty and the UPOV
Convention.  In April 1994, the UPOV determined that Colombia
met the requirements for admission to the UPOV Convention, and
authorized it to deposit accession documents.

    Copyrights:  In 1994, Colombia adopted Andean Pact Decision
351, which harmonizes, integrates and modernizes the laws of
the five Andean countries.  It also expressly protects
software.  In general, however, Decision 351 does not
significantly alter copyright protection in Colombia.

    Colombia's copyright law is based on Law 23 of 1982 and Law
44 of 1993, which increase criminal penalties.  Colombian law
provides copyright protection for the life of the author plus
80 years.  If the holder of the rights to the work is a legal
entity, the term of protection drops to 30 years from the date
of first publication.  Computer software was protected under
Law 44.  Colombian copyright law is unclear as to whether it
must honor foreign satellite signals.

    Although Colombia has a modern copyright law, weak
enforcement remains a serious problem.  Video cassette and
satellite signal piracy continue to be widespread.  Amendments
to the copyright law made in 1993 have significantly increased
penalties for infringement.  The police administrative agencies
now can seize pirated material and close an establishment, and
either suspend or cancel the operating license of any
establishment open to the public where copyright infringement
has occurred.  Nevertheless, enforcement efforts have been

    Colombia belongs to the Berne (1987) and Universal (1976)
Copyright Conventions, the Buenos Aires and Washington
Conventions, the Rome Convention on Copyrights (1976) and the
Geneva convention for Phonograms (1994).  It is not a member of
the Brussels Convention on Satellite Signals.

    Trademarks:  Colombia's trademark protection requires
registration and use of a trademark in Colombia.  Trademark
registrations have a ten-year duration and may be renewed for
successive ten-year periods.  Priority rights are granted to
the first application for trademark in another Andean Pact
country or in any country which grants reciprocal rights. 
Trademark owners do not have a cause of action against
importation of products from other Andean Pact countries that
bear their trademarks without authorization, though certain
labeling requirements concerning country-of-origin apply. 
Colombia is a member of the Interamerican Convention for
Trademark and Commercial Protection.  Enforcement of trademark
legislation in Colombia is weak.

    Trade Secrets:  Andean Pact Decision 344 protects
industrial secrets.  Protected property includes that which is
secret (not generally known or easily accessible to those who
usually handle such information) or has an effective commercial
value or a potential commercial value as a secret, when the
person possessing the secret has taken reasonable steps to
ensure secrecy.

    Semiconductors:  Semiconductor design layouts are not
protected under Colombian law.  However, the Colombian
Copyright Office has expressed its willingness to discuss the

8.  Worker Rights

    a.  The Right of Association

    The right of workers to organize unions, engage in
collective bargaining and strike is recognized by the
Constitution and the law.  The Colombian labor code was
completely revised in December 1990 by Law 50, which authorizes
automatic legal recognition of unions which have obtained
internally 25 signatures from a work place.  It also
strengthens penalties for interfering with workers' freedom of
association.  The new Labor Law also authorizes the
independence of labor organizations in determining internal
rules and electing officers.  In addition, the law forbids the
dissolution of trade unions by administrative decree. 
Colombian workers are organized into 2,265 unions, 101
federations and three confederations.  Unions may establish
international affiliations without governmental restrictions. 
The Constitution extends the right to strike to nonessential
public employees, but the definition of "essential" has yet to
be determined by law.  Before carrying out a legal strike,
unions must negotiate directly with management and, in the
absence of an agreement, engage in conciliation procedures.  By
law, public employees must go to binding arbitration if
conciliation talks fail.  In practice, public service unions
decide by membership vote whether or not to seek arbitration.

    b.  The Right to Organize and Bargain Collectively

    Colombian unions have been moderately successful in
organizing larger firms and public services, but their members
comprise less than eight percent of Colombia's economically 
active population.  Weak union organizations have limited
workers' bargaining power in the private sector.  Antiunion
discrimination or the obstruction of union association is
illegal and is enforced by administrative labor inspections. 
The use of strikebreakers is prohibited by the labor code. 
Colombian labor law is applied in the country's free trade
zones (FTZs).  There is no restriction against union
organization or collective bargaining agreements in the FTZs.

    c.  Forced or Compulsory Labor

    Forced or compulsory labor is prohibited by the
Constitution, which specifically forbids slavery or any
treatment of human beings in servitude.  This prohibition is
respected in practice.

    d.  Minimum Employment Age

    The Constitution prohibits the employment of youngsters in
most jobs under the age of 14.  The labor code prohibits those
under age 18 from receiving government work permits.  While
this provision is generally respected by larger private
companies, the extensive informal economy as well as specific
areas such as cut flowers, coal mining, and leather tanning are
effectively outside governmental control.

    e.  Acceptable Conditions of Work

    The Colombian Government annually sets a national minimum
wage which serves as an important benchmark for wage
negotiations.  However, an estimated one-quarter of the labor
force, mainly in the informal sector, earns less than the
minimum wage.  The labor code also establishes a standard work
day of eight hours and a forty-eight hour work week. 
Enforcement of these laws is the responsibility of the Ministry
of Labor and the court system.

    f.  Rights in Sectors with U.S. Investment

    All foreign investors are subject to Colombian laws
protecting worker rights.  U.S. investment is found principally
in the petroleum, coal mining, chemicals, and manufacturing
industries.  Worker rights conditions in those sectors in
practice are superior to those prevailing elsewhere in the
economy due to the large size and high degree of organization
of the enterprises.  Examples include shorter than average
working hours, payment of the highest wages and salaries in
Colombia and maintenance of occupational health and safety
standards well above the national average.

  Extent of U.S. Investment in Selected Industries.--U.S. Direct
Investment Position Abroad on an Historical Cost Basis--1993

                    (Millions of U.S. dollars)
              Category                          Amount          

Petroleum                                               758
Total Manufacturing                                     769
  Food & Kindred Products                   220
  Chemicals and Allied Products             284
  Metals, Primary & Fabricated               34
  Machinery, except Electrical                0
  Electric & Electronic Equipment            26
  Transportation Equipment                    1
  Other Manufacturing                       204
Wholesale Trade                                         117
Banking                                                 (1)
Finance/Insurance/Real Estate                           335
Services                                                 13
Other Industries                                        (1)
TOTAL ALL INDUSTRIES                                  2,542    

(1) Suppressed to avoid disclosing data of individual companies

Source: U.S. Department of Commerce, Bureau of Economic


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