Authors:
Federico Scarpa (Junior Researcher GEO Economia)
Marco Rizzi (Senior Researcher GEO Cultura e Società)
Abstract:
Colombia, in the post-conflict period following the 2016 peace agreement with FARC, faces a complex socio-economic landscape characterized by both progress and persistent challenges. This article examines key areas of Colombia's development, including urbanization, social inequality, labor market dynamics, and economic growth, as well as the country's evolving international partnerships. While Colombia is the third-largest economy in South America, it struggles with deep-rooted issues such as labor informality, gender inequality, and organized crime, all of which hinder its full potential. The analysis highlights the critical reforms and policy actions needed to foster long-term stability, reduce inequalities, and position Colombia as a stronger player on both regional and global stages.
1. Introduction
Colombia is at a critical juncture in its history, transitioning from decades of internal conflict to a future filled with both challenges and opportunities. The 2016 peace agreement with the Revolutionary Armed Forces of Colombia was a historic milestone, ending a conflict that had ravaged the country for over half a century. While the peace process marked the beginning of a new chapter, the socio-economic realities of rebuilding the nation and addressing long-standing inequalities remain complex. This article provides an in-depth analysis of Colombia's socio-economic evolution, exploring the interplay between urbanization, rural development, social inequality, and economic policies. Colombia has made significant strides in modernizing its economy, becoming the third-largest economy in South America. However, issues such as a stark rural-urban divide, labor informality, and gender inequality continue to undermine its growth potential. The economic landscape is further complicated by security challenges, with organized crime and narcotrafficking posing significant threats to national stability. In addition to its internal dynamics, Colombia’s position on the global stage is shaped by its strategic partnerships, particularly with the United States and emerging ties with China. These relationships influence key sectors such as trade, energy, and security, all of which are crucial for the country's long-term development. By examining Colombia’s socio-economic trajectory, this article sheds light on the policy reforms and strategic investments necessary to bridge the development gaps and ensure sustainable growth. Readers can expect a comprehensive overview of the key factors shaping Colombia’s future, along with critical insights into how the nation can overcome its current challenges to achieve lasting prosperity.
2. Evolution of Colombian Socio-Economic Context
2.1 Historical and social evolution
The socio-economic landscape of Colombia has undergone significant transformations, particularly in the post-conflict era following the 2016 peace agreement with the Revolutionary Armed Forces of Colombia (FARC). This accord marked a turning point in reducing violence and fostering social reconstruction. However, the process of reintegrating former combatants and stabilizing rural areas remains a major challenge. Historically, Colombia’s internal conflict exacerbated socio-economic disparities, especially between rural and urban populations. In rural areas, the lack of state presence has perpetuated cycles of poverty, low educational attainment, and poor access to basic services, creating a marginalized segment of the population (Restrepo, 2018). The peace agreement brought renewed attention to these issues, with an emphasis on land redistribution and rural development, aiming to reduce the economic imbalance that favors urban centers such as Bogotá and Medellín (García-Godos & Wiig, 2018). Yet, significant socio-economic challenges persist. The development gap between urban and rural areas remains stark, with poverty rates in rural regions being more than double that of urban areas (World Bank, 2020). These challenges highlight the complex and ongoing nature of Colombia's social evolution, despite efforts at reconciliation and development.
2.2 Urbanization and demographic shifts
Colombia’s urbanization rate is among the highest in Latin America, with over 80% of the population now residing in urban areas (OECD, 2019). The urban migration wave, which intensified during the height of the conflict, has contributed to the expansion of informal settlements and exacerbated urban poverty. Many rural migrants, fleeing violence and poverty, have struggled to integrate into the formal economy, leading to widespread informal employment and precarious living conditions in the cities (DNP, 2021). This rapid urbanization has both economic and social implications. While cities like Bogotá and Medellín have experienced economic growth, they also face rising inequality, housing shortages, and strained public services. Furthermore, urban centers are hubs for innovation and economic diversification, but rural areas lag behind, deepening socio-economic disparities. The lack of infrastructure and economic opportunity in rural regions calls for the need for policies that can bridge this rural-urban divide (Perry & Uribe, 2019).
2.3 Social inequality
One of Colombia’s most pressing issues remains its deep-rooted social inequality. The Gini coefficient, which measures income inequality, consistently places Colombia among the most unequal countries in Latin America (Cepeda, 2019). This inequality is driven by historical factors such as unequal land distribution, which has been a key factor in both fuelling and prolonging the conflict. The peace process sought to address this through agrarian reforms, but the implementation has been slow, and many communities continue to face limited access to land and resources (Rettberg, 2020). Education inequality is another critical factor contributing to broader socio-economic disparities. Access to quality education remains uneven, particularly between urban and rural areas. While cities have access to better-funded schools and universities, rural areas suffer from underfunded educational institutions and high dropout rates, further perpetuating cycles of poverty (Castañeda, 2020). Moreover, Colombia’s labor market reflects these inequalities, with high informality rates, particularly affecting women and rural workers, limiting social mobility and reinforcing existing class divisions.
3. Economic development dynamics
3.1 Colombia’s macroeconomics overlook
According to the World Bank, Colombia represents the third largest economy in South America (behind Brazil and Argentina) by GDP in 2023 (USD 363 billion). Despite this, the Andean State suffers a low productivity level from the 90s through all the 21st century until 2019. Neither the 2008-2015 oil boom was able to increase it. (IMF, 2024). Only during the COVID-19 pandemic, Colombia’s economy showed a significant growth mainly thanks to the large financial maneuver, better identified as expansive monetary policy which substantially helped the internal market to not succumb, supporting internal demand and production. This positive effect affected even the external market thanks to the relatively good production output sustained. However the benefits of the expansive policy left place to a decreasing productivity and a much higher inflation level, standing at 11,7% in 2023 (World Bank, 2023), during the 2022-2023 period (a normally-observed effect due to the emission of extra currency causing increased amount of money in the financial system) which forced Bogotà to end the expansive phase to a more cautious monetary policy, resulting in a significant reduction of the inflation, highlighted by the current 0.24% CPI (DANE, 2024). But the estimated growth level stands only at 1.1% Real GDP (IMF, 2024), thus the current economic growth in the 2nd quarter of 2024 is 2.1% (DANE, 2024). This said, Colombia have an actual high margin to pursue a very accurate and prudent expansive policy, sustaining higher production levels and external market in order to boost the long term economic growth, controlling and managing higher inflation levels (thus not eliminating the effects of a consequent increase in inflation) thanks to the relatively good levels of deficit at 5% GDP (OECD, 2024) and public debt at 55.3% GDP (Ministerio de Hacienda y Crédito Público, 2024). Another key element is the credit rating, which measures the State’s financial stability. S&P assigned BB+ rating to Colombia, meaning there’s a medium-high risk level (compensated with higher interest rates) in investing operations.
3.2 Key global sectors and international cooperation
To better understand the economic dynamics of Colombia, it's crucial to take a look at main market sectors and international partnerships in trade and economic development. The main export products are represented by fossil fuels (especially crude oil and derivatives), vegetable products (primarily coffee, bananas and palm oil) and minerals (mainly gold and emeralds). The strongest export partners are the United States of America, Panama, the European Union (especially Netherlands) and, as regional key partners, Brazil, Ecuador and Chile. A minor but in rapid ascent partener is represented by China, followed by stable trade partnership with India. On the other hand, main import products are commodities and services, mainly from the USA, China, EU and Brazil, especially technology products, oil derivatives, components, cars and chemicals. Talking about trade dynamics, we must cite the strong pluriannual tie between Colombia and the USA, which constitute the main international partener and public investor in the Andean State’s economy remarked by the resilience in international relations and mutual cooperation in several sectors (from politics, to economics, to defense and security). In fact, Colombia is the strongest and most affordable ally to the United States in South America and, along with Panamà, the key international partner in Latin America & Caribbean region for economic and political stability in the area, playing a strategic role in USA’s global presence and power. On the other side, Colombia benefits from Washington mainly in economic development aids and security assistance in internal national security, promoting and ensuring the cooperation between the Colombia National Police (and the Armed Forces of Colombia) and the main US federal investigative agencies/authorities (such as, but not only, FBI and DEA), against the plague represented by terrorism and narcotraffic. The EU also represents a strategic economic partner for Colombia and vice-versa. Remarking the emerging global importance of the South American market, a “new” partner for Colombia shows up: China. In recent years the ties between Bogotà and Beijing are slowly (but constantly) strengthening, as highlighted by recent diplomatic missions in China in 2023. The benefits could be multiple for both countries. First of all, China aims to tackle and reduce Washington’s influence in LATAM by mining its relations with the strongest regional partner and upgrading Beijing global weight; Colombia could receive abnormous economic developments support, especially in trade, national transport and energy transition. In fact, Colombia showed interest in joining the BRI. Although, we must not forget the potential perils in this international cooperations with China (as tested, in LATAM, by Nicaragua’s never realized canal project) that could lead Colombia to serious financial issues. Two last notable facts in Colombia’s International Relations are that it is a MERCOSUR (Common Market of South America) and NATO (first and only south-american country) strategic partner.
3.3 Economic development challenges
Being the third economic power in South America by GDP, means nothing if the productivity factor is low and the inequality gap is the highest in the entire region and one of the highest in the world, measured by the GINI coefficient which stands at 0.72 in Colombia (Our World in Data, 2022). Taking a look at the GDP contributions at local level, according to DANE’s 2024 data, it is extremely clear the abnormous gap between the richests and poorests departments of Colombia and the central and peripheral zone in most of the cities, with the exception of Bogotà which shows a great urban and social development, despite some neighborhoods are still facing tough social situations. In fact, the main contributor to GDP is the Bogotà Capital District, closely followed by the richest department of the Andean State: Antioquia and its capital Medellìn, the second most important city of Colombia and sadly known for the home of Pablo Escobar and the center of the colombian narcotraffic illicit activity, still ongoing. Despite this, Antioquia is the best developed department (with the exception of Bogotà C.D.). Moving towards both north and south from Bogotà and Antioquia, the economic situations changes drastically, especially in the pacific coast, along the borders with Ecuador and Perù and in the south-eastern part of Colombia where – due to the lowest population level and the lowest incomes – are the poorest and undeveloped departments of entire Colombia, where even critical essential services lacks in some urban areas. The “iconicity” of the development gap in Colombia could be better explained by looking at Valle del Caucà department, more specifically the city of Buenaventura, home of the second trade port of Colombia and the only strategic port on the pacific coast. This department is one of the most incisive contributors to the national GDP, mainly thanks to the port activity and the financial and assurance services. Despite this, the city of Buenaventura faces a dramatic socio-economic situation and a tangible economic inequality between the city’s center and the peripheral area. Talking about the port of Buenaventura, it’s crucial to analyze the transportation sector that shows critical evidence of undevelopment, especially the national railway network which is one of the oldest in LATAM. In fact, President Petro relaunched the plan for Colombia to have a modern railway system helping people moving across the country faster, smarter and cheaper. Plus, there could be plans to link the two main and opposite ports of Colombia (the port of Cartagena de Indias in the Caribbean Sea and the cited Buenaventura’s) via dedicated railway, advantaging trade sector and improving the productivity. Last but not least the energy sector is crucial for economic development strategies and Colombia is moving towards energy transition investing in alternative sources. In particular, hydroelectric power represents 80% (circa) out of total renewable production and is still increasing. Despite this, the Andean State relies its energy production mainly on fossil fuels (IEA, 2023).
4. Social Challenges and their economic impact
4.1 Labour and unemployment
The Colombian labor market exhibits structural characteristics that both reflect and perpetuate deep-rooted inequalities, with labor informality being the most significant challenge. Informality undermines workers' rights and economic security, restricting the country’s economic potential by keeping a large segment of the population outside the formal, regulated economy. Informal employment denies workers access to pensions, healthcare, and other social safety nets, making them more vulnerable to economic downturns and external shocks. This vulnerability was starkly exposed during the COVID-19 pandemic, which exacerbated the plight of informal workers due to the lack of accessible state support for those outside the formal sector (World Bank, 2021).
From a macroeconomic perspective, the high rate of informality in Colombia - estimated at around 60% - represents a significant drain on government revenues, as informal workers and employers often evade taxation (ILO, 2020). This limits the state’s ability to invest in public goods such as healthcare, education, and infrastructure, crucial for reducing poverty and promoting long-term growth. Additionally, the high level of informality in the labor market also depresses productivity, as informal enterprises tend to be smaller, less efficient, and unable to access formal credit markets (Perry & Uribe, 2019). As a result, informal workers are often trapped in low-wage, low-productivity jobs, which perpetuates the cycle of poverty. Efforts to formalize the labor market, such as reducing the regulatory burden on small businesses and providing incentives for formal employment, have yielded limited success. One reason for this is that many workers prefer informal employment due to its perceived flexibility, particularly in sectors such as agriculture and domestic work, where formal employment opportunities are scarce (Maloney, 2021). Furthermore, enforcement of labor regulations is weak, particularly in rural areas, where government oversight is minimal, and informal employment is the norm.
Youth unemployment in Colombia is an issue of critical concern. The youth unemployment rate has consistently been one of the highest in the region, reaching 23% in 2021 (OECD, 2020). A key reason for this is the mismatch between the skills young people acquire in the education system and the demands of the labor market. Many young Colombians enter the job market with inadequate vocational training and limited opportunities for gaining practical experience, which reduces their employability. Furthermore, those who do find employment are often confined to informal sectors, where job security is low, and wages are insufficient to support upward social mobility. The high rate of youth unemployment has far-reaching economic and social consequences. Economically, it represents a significant loss of potential, as a large proportion of the workforce is unable to contribute to the country's productivity. Socially, the exclusion of young people from formal employment opportunities increases the risk of social unrest and political instability, as disenfranchised youth are more likely to engage in illegal activities or join criminal organizations, particularly in conflict-affected regions (Castañeda, 2020).
The gender disparities in Colombia’s labor market are similarly stark. Despite legal frameworks aimed at promoting gender equality, women remain underrepresented in the workforce, particularly in formal employment. As of 2021, only 54% of working-age women were employed or seeking employment, compared to 74% of men (World Bank, 2020). This gap is driven by a variety of factors, including cultural norms that prioritize women’s roles in the domestic sphere, lack of affordable childcare, and gender discrimination in hiring practices. The economic implications of this gender disparity are significant. Women’s lower participation in the labor market results in a substantial loss of potential economic output, as women’s skills and talents are underutilized. Moreover, when women do participate in the labor market, they are more likely to be employed in informal sectors, where wages are lower, and job security is lacking. (OECD, 2020).
Although the Colombian government has implemented policies aimed at reducing informality and promoting women’s participation in the labor market, these efforts have been insufficient to address the root causes of labor market inequality. For example, programmes aimed at encouraging formalization, such as tax incentives for small businesses, have had limited uptake due to the high costs and bureaucratic hurdles associated with compliance (Fedesarrollo, 2021). Similarly, initiatives to support women’s employment, such as the expansion of childcare services, have been unevenly implemented, particularly in rural areas, where the need is greatest. A more comprehensive approach to labor market reform is required, one that reduces the barriers to formalization but also addresses the broader social and economic factors that drive informality and inequality. This would include investments in education and vocational training, particularly for young people and women, as well as targeted policies to improve access to formal employment in rural and marginalized communities (Maloney, 2021). Moreover, stronger enforcement of labor regulations is necessary to protect workers’ rights and ensure that businesses comply with formal employment standards, particularly in sectors that are prone to informality, such as agriculture and domestic work.
Colombia’s unemployment problem is compounded by high levels of job precarity. Precarious employment refers to work that is insecure, poorly paid, and lacks the benefits associated with formal employment, such as job security, pensions, and healthcare. According to recent data, precarious employment affects a significant proportion of the workforce, particularly in the informal sector (OECD, 2019). Precarious employment has significant implications for economic stability, both at the individual and macroeconomic levels. For workers, precarious jobs provide little security and make it difficult to plan for the future, resulting in lower savings and reduced investments in education and training. This, in turn, limits workers' ability to improve their economic prospects over time, perpetuating cycles of poverty and inequality. At the macroeconomic level, high levels of precarious employment reduce overall economic productivity and limit the government's ability to raise tax revenue, as precarious workers are less likely to contribute to the formal tax system. This undermines the state’s capacity to provide public goods and services, which are essential for promoting long-term economic growth (OECD, 2019). The government’s response to the problem of precarious employment has been mixed. While there have been efforts to strengthen labor regulations and increase enforcement, these initiatives have often been hampered by limited resources and capacity, particularly in rural areas where precarious work is most prevalent (DNP, 2021).
4.2 Educational system and human capital
Education is a fundamental driver of economic growth and social mobility, yet Colombia's education system suffers from persistent inequalities, particularly between rural and urban regions. Despite improvements in access to education, significant disparities remain in terms of quality, infrastructure, and outcomes. These gaps hinder Colombia's socio-economic development, undermining the country's ability to compete in an increasingly globalized and knowledge-based economy (Castañeda, 2020).
One of the most striking challenges in Colombia’s education system is the regional divide between rural and urban areas. According to the World Bank (2020), students in rural regions are significantly more likely to drop out of school and less likely to pursue higher education compared to their urban counterparts. In rural areas, only 13% of young people complete secondary education, while this figure rises to over 50% in urban centers like Bogotá and Medellín (OECD, 2019). This stark contrast can be attributed to several factors, including under-resourced schools, lack of infrastructure, and the distance many rural students must travel to access educational facilities. The consequences of these disparities are profound. Limited access to quality education in rural areas traps many Colombians in a cycle of poverty, as they are unable to acquire the skills necessary to enter the formal labor market or pursue higher-paying jobs in growing sectors such as technology and services (OECD, 2019). The gap in educational outcomes between rural and urban areas also perpetuates regional inequalities, with wealth and economic opportunity concentrated in a few urban centers while rural regions remain economically marginalized (Perry & Uribe, 2019). Colombian policymakers have recognised the importance of addressing these disparities and have implemented various initiatives to improve access to education in rural areas. One such effort is the Escuela Nueva programme, which adapts educational models to rural settings by focusing on flexible schedules, multi-grade classrooms, and community involvement (Rettberg, 2020). Although this initiative has shown some success in increasing enrolment and retention rates in rural schools, significant challenges remain, particularly in terms of funding, teacher training, and scalability.
Beyond access, the quality of education remains a major issue, particularly in underfunded public schools. A critical problem is the shortage of qualified teachers, especially in rural areas where working conditions are often challenging. Teachers in these regions frequently lack the necessary training, resources, and support to provide a high-quality education (Castañeda, 2020). This shortage is compounded by poor infrastructure, with many schools lacking basic facilities such as electricity, internet access, and clean water, further hampering the learning environment (OECD, 2019). Moreover, the curriculum in many Colombian schools is outdated and does not adequately prepare students for the demands of the modern economy. There is a growing need for reforms that focus on developing critical thinking, problem-solving, and technological skills, which are essential for success in the 21st-century workforce. The lack of emphasis on vocational and technical education is particularly problematic, as many students are unable to transition from education into the labor market effectively. As a result, there is a mismatch between the skills students acquire in school and the needs of employers, particularly in high-growth sectors such as technology and innovation (World Bank, 2020).
Human capital is a key determinant of long-term economic growth, and Colombia’s education system is not producing the level of human capital required to sustain high levels of productivity and innovation. The World Bank (2020) notes that Colombia’s human capital index - an indicator of how effectively countries are developing the skills and capacities of their people - lags behind other middle-income countries. One of the primary reasons for this is the failure to invest adequately in education and training, particularly in disadvantaged areas. The economic consequences of this underinvestment in human capital are significant. A poorly educated workforce limits the country’s ability to attract investment in high-value industries, as businesses require a skilled labor force to operate efficiently and innovate. This is particularly relevant in sectors such as information technology, renewable energy, and advanced manufacturing, which are key to Colombia’s future economic competitiveness (OECD, 2019).
An additional challenge linked to the weaknesses in Colombia’s education system is the phenomenon of brain drain. Many highly skilled professionals, particularly those with advanced degrees, choose to emigrate to countries where they can find better job opportunities, higher salaries, and more supportive research environments. According to a study by the Colombian government, between 2005 and 2019, Colombia lost an estimated 1.2 million highly educated workers to emigration, particularly in fields such as engineering, medicine, and information technology (DNP, 2021). The loss of this human capital represents a significant drain on Colombia’s economy. Skilled workers who leave the country contribute to the economies of their host countries, depriving Colombia of the expertise and innovation necessary to drive domestic economic growth. In addition, brain drain exacerbates inequality, as the benefits of higher education and professional success are increasingly concentrated among those who can afford to leave, while less privileged Colombians remain trapped in low-skill, low-wage jobs (Rettberg, 2020). To combat this issue, the Colombian government has implemented several initiatives aimed at retaining and attracting talent. These include increasing funding for research and development, creating public-private partnerships to foster innovation, and providing scholarships and incentives for students to study in high-demand fields such as engineering and technology (OECD, 2020). However, these efforts have had limited success, as many of the underlying issues - such as poor working conditions, low wages, and limited career advancement opportunities - remain unaddressed.
For Colombia to capitalize on its human capital potential, significant reforms are needed across the education system. This includes increasing investment in education and addressing structural barriers that limit access to quality education, particularly in rural and marginalized communities. In particular, reforms should focus on modernizing the curriculum to meet the needs of a rapidly changing global economy, improving teacher training, and expanding access to vocational and technical education. In addition, more targeted efforts are required to retain talent and reverse the brain drain trend. This could include creating more attractive working conditions for highly skilled professionals, expanding research funding, and fostering innovation ecosystems that provide opportunities for entrepreneurship and career advancement. By addressing these challenges, Colombia can unlock the full potential of its human capital, which is essential for long-term economic growth and development (Rettberg, 2020).
4.3 Gender inequality in economic participation
Gender inequality in Colombia’s labor market remains a persistent challenge that limits economic growth and stifles social development. Although progress has been made in terms of legal rights and gender representation in public life, women continue to face significant barriers to full economic participation. These barriers are deeply rooted in societal norms, structural inequalities, and historical legacies, and their impact extends across multiple dimensions, including wage gaps, occupational segregation, and access to social protections (OECD, 2020).
Despite Colombia's relatively strong legal framework supporting gender equality, women remain underrepresented in the workforce, particularly in formal, high-paying jobs. According to the World Bank (2020), as of 2021, only 54% of working-age women in Colombia are either employed or actively seeking work, compared to 74% of men. The gender participation gap is even more pronounced in rural areas, where traditional gender roles and limited access to education and formal employment opportunities further restrict women’s economic activity (Perry & Uribe, 2019). This discrepancy between male and female participation in the labor market has wide-reaching economic implications, as it results in the underutilisation of a significant portion of the workforce. One of the major factors contributing to this gender gap is the disproportionate burden of unpaid domestic and care work that falls on women. Colombian women spend, on average, twice as much time as men on unpaid household tasks and caregiving, leaving them with less time and flexibility to engage in paid employment (OECD, 2020). This imbalance is further exacerbated by the lack of affordable childcare services and family-friendly work policies, particularly in rural areas where public services are limited. Consequently, many women are forced to accept informal, low-paying jobs that offer the flexibility to balance work with domestic responsibilities but provide little in terms of social security, pensions, or job stability (DNP, 2021). The underrepresentation of women in formal employment has broader macroeconomic consequences. Research suggests that closing the gender gap in labor market participation could significantly boost Colombia’s GDP, as greater inclusion of women would increase the size and productivity of the workforce (World Bank, 2020). Moreover, studies show that firms with greater gender diversity, particularly in leadership positions, tend to be more innovative and profitable, as they benefit from a wider range of perspectives and experiences (McKinsey & Company, 2019).
In addition to lower participation rates, women in Colombia face significant wage disparities compared to men. The gender wage gap, which refers to the difference in average earnings between men and women for similar work, remains substantial. As of 2021, women in Colombia earn, on average, 17% less than men, even after accounting for differences in education, experience, and job type (OECD, 2020). This wage gap is particularly pronounced in high-skilled professions such as finance, law, and medicine, where men are more likely to occupy senior positions and receive higher pay (World Bank, 2020). The persistence of the gender wage gap is closely linked to occupational segregation, whereby women and men are concentrated in different sectors and job types. In Colombia, women are overrepresented in lower-paying industries such as education, healthcare, and retail, while men dominate higher-paying fields such as engineering, technology, and finance (Castañeda, 2020). This segregation is partly the result of societal norms that discourage women from pursuing careers in traditionally male-dominated fields, as well as structural barriers such as limited access to STEM (science, technology, engineering, and mathematics) education for women and girls. Furthermore, even within the same industry, women are less likely to occupy leadership positions or high-paying roles, contributing to the wage gap (ILO, 2020). The economic costs of the gender wage gap are significant, both for women and for society as a whole. For women, lower wages translate into reduced lifetime earnings, savings, and retirement security, making them more vulnerable to poverty in old age (McKinsey & Company, 2019). For the economy, the gender wage gap represents a loss of potential productivity and talent, as women’s contributions are undervalued and undercompensated. (World Bank, 2020).
The Colombian government has taken steps to address gender inequality through a range of legal and policy initiatives, though their effectiveness has been uneven. Colombia’s Constitution guarantees equal rights for men and women, and various laws have been enacted to promote gender equality in employment, such as anti-discrimination legislation and maternity protections (DNP, 2021). In recent years, the government has also introduced programmes aimed at increasing women’s participation in the workforce, including incentives for women entrepreneurs, targeted training for women in STEM fields, and expanded access to childcare services (OECD, 2019). However, these efforts have not fully addressed the structural barriers that limit women’s economic participation. One of the key shortcomings of Colombia’s gender equality policies is their uneven implementation, particularly in rural and marginalized communities. For example, while urban centers may benefit from relatively well-developed childcare services and educational programmes, rural areas often lack the infrastructure and resources to support women’s full participation in the labor market (Perry & Uribe, 2019). Additionally, cultural norms and societal expectations continue to play a powerful role in shaping gender roles, particularly in rural regions, where traditional views of women’s place in the household persist (Rettberg, 2020). Beyond governmental policies, various non-governmental organizations (NGOs) and civil society groups have played a critical role in advancing gender equality in Colombia. Organizations such as Mujeres por Colombia and the Consejo Nacional de la Mujer have been instrumental in advocating for women’s rights, raising awareness of gender-based violence, and promoting female leadership in both the public and private sectors. These groups have also worked to provide women with the skills and support needed to enter the labor market, including through training programmes, mentorship opportunities, and microfinance initiatives aimed at supporting women entrepreneurs (OECD, 2020). Additionally, international organizations such as the United Nations and the World Bank have supported Colombia’s gender equality agenda through various initiatives and funding programmes. For example, the Women’s Economic Empowerment in Post-Conflict Colombia programme, supported by UN Women, aims to promote women’s economic participation in regions affected by the armed conflict by providing training and resources for women-led businesses (García-Godos & Wiig, 2018). These initiatives are critical for ensuring that the benefits of peace and development are shared equally between men and women, particularly in conflict-affected regions where women have been disproportionately affected by violence and displacement.
Another significant barrier to women’s full economic participation is the high prevalence of gender-based violence (GBV) in Colombia. Violence against women, including domestic violence, sexual assault, and femicide, remains a widespread issue, with profound social and economic consequences. According to Colombia’s National Institute of Legal Medicine and Forensic Sciences, there were over 21,000 reported cases of domestic violence against women in 2020, and these figures are believed to represent only a fraction of the actual cases (DNP, 2021). GBV undermines women’s ability to participate fully in the economy. Women who experience violence are more likely to suffer from physical and mental health problems, which can hinder their ability to work or pursue education. Furthermore, the fear of violence often forces women to limit their economic activities, avoid certain professions, or withdraw from the labor market altogether (World Bank, 2020). The economic cost of GBV is substantial, as it reduces women’s productivity, increases healthcare costs, and perpetuates cycles of poverty and exclusion. The Colombian government has taken steps to address GBV through legislation and social programmes, including the establishment of specialized courts for cases of violence against women and the implementation of public awareness campaigns (OECD, 2020). However, these efforts have been hampered by limited enforcement and a lack of resources, particularly in rural areas where law enforcement is weak, and social services are scarce. (Rettberg, 2020).
5. Security Challenges and their impact on Economy :
5.1 Organized Crime and Terrorism
Talking about social issues in Colombia, the most representative and world-wide known is surely organized crime, mainly identified in terrorism and narcotraffic. Despite defeating and dismantling the three biggest drug cartels active between the 70s and 90s (Medellìn Cartel, Cali Cartel and Norte del Valle Cartel), this plague hasn’t stopped. Similarly the eversive terrorism pursued by armed militant groups as Ex-FARC Mafia (Ex Fuerzas Armadas Revolucionarias de Colombia Mafia) and ELN (Ejército de Liberación Nacional) and other well organized paramilitary criminal groups remains a significant threat. These groups, partially resulting from the fragmentation of the disbanded “big three cartels” armed factions are currently the main “new cartels” that pose a serious, more pervasive and dangerously powerful threat to Colombia’s national security, significantly afflicting its economic development perspectives and action plans. The reason lies in what those armed criminal organizations take profit of: illicit activities of any kind, especially those linked with international crime like money laundering, illicit/regulated goods smuggling, illicit financial activities and, most of all, human trafficking, narcotraffic and armed fight against government forces and institutions via terrorism actions. At first, it seemed like the 2016 armistice signed between the Colombian government and FARC could have posed a new milestone in Colombia’s internal stability path. However, in 2023 the situation escalated to the pre-2016 period and now there is evidence of a violence backdraft spreading in the internal zones and all along the borders with Ecuador, Venezuela and in the Darièn forest. As cited, the main profits of these organized crime formations are human trafficking and narcotraffic. According to UNHCR, Colombia shelters 2.8 millions of immigrants from Venezuela due to emigration from the neighboring State which suffers the most critical humanitarian emergency in South America. Colombian organized criminal groups know that and take profit smuggling emigrants from Venezuela to Panamà, through the Darièn forest and via sea travel, and to Colombia itself even committing horrific crimes against humanity (Human Rights Watch, 2023). In addition to this socio-humanitarian plague, Colombian militant groups specialize in eco-fin crimes. This specific category refers to those felonies that lacerate the economic-financial tissue of the State, particularly referring to the preceded cited money laundering, corruption, illicit activities financing and illicit smuggling (including narcotraffic). That’s because these crimes are the main motor of the so-called “submerged economy” like tax evasion, illegal labor, covering of illicit activities via apparent “lecit” activities. Plus the abnormous submerged global and local market of illegal/regulated goods like weapons, drugs, protected animal and vegetable spices, organs, human beings, counterfeited goods, mineral products, diamonds etc., draining huge financial resources and incomes from the State’s wallet and affecting the economic security. Ending with the dark phenomenon of corruption which clearly obstructs investigative actions, hits the legal goods/services market and affects the State's critical institutions and the public/private administration. And money laundering (recently facilitated by the anonymous operability behind the main cryptocurrencies companies) which, according to FATF (Financial Action Task Force) constitutes a serious threat to the State's financial security, decisively contributing to deteriorate the eco-fin security due the apparent money’s legal provenience.
5.2 Local crime
Moving away from the criminal logics of the organized crime groups, at the local level the illicit activities constituting the main threat to the State’s economy are tax evasion and illegal labor. Evading fiscal tributes and taxes is a pervaded crime statewide. In the same manner, illegal labor is also prevalent among economy-related crimes. In both cases, it seems the reason is linked to the poor socio-cultural condition rather than a real criminal intent, however, this second, constitutes a diffused criminal practice, specially by micro-entrepreneurs (but not only) trying to gain some personal profit and/or not accepting fiscal ease for certain categories and/or social classes. The main cause, therefore, is the socio-cultural lack in financial education, law and in general knowledge of the fiscal regime logics and bureaucracy. This logic, unfortunately, leads to a very low level of tax revenue that negatively affects the State’s economy, reducing the amount of financial resources that could be invested in services and welfare policies and, generally, in public spending. The same has already been said, in the previous chapter, for illegal labor which is directly linked to the need to find a job (or a second one, “tax free”) that can assure a certain income and, in some way, a superior grade of financial independence, rather than commit a crime deliberately, also motivated by the high unemployment rate among youth population. Also, a high level of ignorance afflicting the poorest portion of the population, is responsible even in this case. The hidden risk behind illegal labor is the advantage the organized crime could use, by “hiring” manpower in undercover business activities.
6. Conclusions
According to what has been described, Colombia suffers a serious situation at social level in terms of economic inequality, gender gap, education, disoccupation (especially among youths) and security. All of these reflect negatively on the State’s economy which is also affected by important issues like low productivity, low tax income and low private investing. First of all, to improve its internal security and maintain the status of third economic power in LATAM, Colombia should put utmost attention in the scholar and university system, in order to significantly upgrade the level of education among the young generation, because this is the first step to reduce social inequality, ignorance (at any level) and tackle the micro-criminality and interfere with the organized crime recruitment schemes. The utmost level of awareness must be in fighting the backdraft of terrorism and efficiently dismantling the armed groups that, as already said, represent the major menace for Colombia’s national security and economic development, with the risk of seriously damaging even the regional stability. Also it is essential to boost productivity by promoting internal zone economic sectors developments, not forgetting the attention for the wildlife and biosphere in the forest promoting sustainable development and circular economy strategies. By this means, energy represents a crucial factor in the equation of economic development and Colombia is doing an important energy transition phase, although current efforts aren’t enough and global warmth could constitute a menace for the water reservoirs and hydroelectric production. Developing an energy mix with a nuclear power quote, would surely be helpful for Colombia’s sustainability strategies. This said, an improvement of the national road and railway system is also fundamental and required, moreover in the south-eastern part of the country that shows the critical situation. OECD states that one key point for Bogotà’s economic development strategies is to promote private investing in the State’s economy. To do so, the government must assure a solid and fertile terrain for investors, building a more resilient economy based on multiple sectors and all over the country regions. Colombia has an incredible unexpressed potential but the socio-economic complex and hard situation doesn’t help in developing a real effective strategy to make the Andean State a real regional power as it deserves. Despite this, following a structural and decisive government action plan based on social reforms and an accurate management and reallocation of the State’s incomes in infrastructures, business, security and education, there will be no doubts Colombia would witness a substantial upgrade and become a key actor in LATAM and probably in the world.
Source Classification
Information Content | ||
1 | Confirmed | Confirmed by other independent sources; logical in itself; coherent with other information on the topic |
2 | Presumably true | Not confirmed; logical in itself; coherent with other information on the topic |
3 | Maybe true | Not confirmed; reasonably logical in itself; coherent with some other information on the topic |
4 | Uncertain | Not confirmed; possible but not logical in itself; no other information on the topic |
5 | Improbable | Not confirmed; not logical in itself; contradicts with other information on the topic |
6 | Not able to be evaluated | No basis to evaluate the validity of the information |
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