Putting Colombia on the Global Investment Map


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An eternal optimist, Liu-Yue built two social enterprises to help make the world a better place. Liu-Yue co-founded Oxstones Investment Club a searchable content platform and business tools for knowledge sharing and financial education. Oxstones.com also provides investors with direct access to U.S. commercial real estate opportunities and other alternative investments. In addition, Liu-Yue also co-founded Cute Brands a cause-oriented character brand management and brand licensing company that creates social awareness on global issues and societal challenges through character creations. Prior to his entrepreneurial endeavors, Liu-Yue worked as an Executive Associate at M&T Bank in the Structured Real Estate Finance Group where he worked with senior management on multiple bank-wide risk management projects. He also had a dual role as a commercial banker advising UHNWIs and family offices on investments, credit, and banking needs while focused on residential CRE, infrastructure development, and affordable housing projects. Prior to M&T, he held a number of positions in Latin American equities and bonds investment groups at SBC Warburg Dillon Read (Swiss Bank), OFFITBANK (the wealth management division of Wachovia Bank), and in small cap equities at Steinberg Priest Capital Management (family office). Liu-Yue has an MBA specializing in investment management and strategy from Georgetown University and a Bachelor of Science in Finance and Marketing from Stern School of Business at NYU. He also completed graduate studies in international management at the University of Oxford, Trinity College.

By Mark Mobius, Franklin Templeton,

Colombia is a land of culturally rich colonial cities, lanky skyscrapers, pristine beaches, dense Amazon jungle, snow-capped Andean and Sierra Nevadan mountains, archeological ruins and home to author Gabriel Garcia Marquez.  And, I should add, in my view, a country ripe with intriguing potential investment opportunities.

After ten years away from Colombia, I started my tour in Cartagena, on the country’s Caribbean coast and then made my way through Bogota, Medellinand Cali. By the end of my trip I was impressed by the developments I saw. One notable change is the stock exchange integration between Colombia, Chile and Peru, making it the second largest equity exchange in the region. Mexico and other countries have already demonstrated their intention to join.1


Mark Mobius in Bogota, Colombia.Mark Mobius in Bogota, Colombia.

Cartagena is one of the country’s most attractive spots and also one of the oldest cities in the Americas, having been founded by the Spanish commander Pedro de Heredia in 1533. A lot of potential tourist spots are still largely unexplored, but cities like Cartagena are increasingly showing signs of becoming a destination, a trend with the potential to yield economic benefits.

At the trade and tourism promotion agency I met with enthusiastic and knowledgeable executives in their downtown Bogota offices. The organization has been expanding its network, especially in Asia and the Middle East, and has been encouraging both exports and domestic investments by Colombian companies as it realizes such investments are likely to eventually lead to more trade.

The officials were honest when our discussion steered towards the challenges Colombia still faces regarding its tarnished image as a drug and guerilla haven.

They acknowledged this continued to be an issue but stressed that there has been a marked improvement as the government has made progress in bringing more areas of guerilla territory under control and has driven out many of the drug lords.  The successes have much to do with the realization by the government that focusing efforts on improving the living conditions for the people could go some way to help to solve some of the problems.

I also visited a company in the tourism sector. What struck me most was the system its management devised in order to focus on customer satisfaction and the key performance indicators which were developed to track management’s proficiency. Also impressive was management’s acceptance that 25% of an employee’s salary should be tied to performance.

One more positive development for growing tourism: in 2013, an open skies agreement between Colombia and the U.S. is scheduled to begin which could result in Colombia becoming an important hub for Latin American airlines.

Colombia’s real GDP is projected to grow by between 5% and 6% by end 2011, and inflation to end 2011 at less than 4%.2 With those numbers, it was no surprise that the companies and government ministry officials I visited in Bogota echoed a generally optimistic economic outlook.  The primary caveat: lack of infrastructure remains one of the main challenges for the country; past guerrilla conflicts made large parts of the country inaccessible, a hurdle the country has not quite yet overcome.  However, as security has improved, the central government has gained more access to the countryside, enabling it to make some progress on infrastructure improvements.

Assuming that economic conditions remain on their current trajectory and security does not deteriorate – which admittedly are not assured, Colombia has the potential to attract around US$6 billion in foreign direct investment annually.3

As an investor, I was also happy to learn that Colombia has never imposed controls that limit the exit of money out of the country. They generally also don’t use physical barriers for money flows, but instead increase transaction costs when inward flows must be controlled.

Less encouraging was the capital market, where I found that it currently remains debt-oriented with a rather limited equity market. This is largely explained by the expanding local pension plans which were gobbling up a large portion of the equity market’s shares.

My visit would not have been complete without a visit to companies in the energy sector. Colombia is the third largest oil exporter in Latin America to the U.S.,4 so I was glad to find evidence of a forward-thinking mindset and a focus on efficiency.

All in all it was an enjoyable trip.  If Colombia is able to carry its momentum for the long term, the country may well be on the road to putting itself on the global investment map.

1 Mercopress & Christian Science Monitor, 8 September 2011
2 CIA The World Factbook, 21 February 2012
3 Economic Intelligence Unit, World Investment Prospects 2011
4 CIA The World Factbook, 21 February 2012

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