Colombia Freight Transport Report 2016

Colombia Freight Transport Report 2016

BMI View: Despite a subdued outlook for Colombia's economy, we expect steady increases in agriculturaloutput will ensure tepid growth in freight volumes in the coming years. We caution that a more robustexpansion will be prevented by a slowdown in the consumer sector, weak global commodities and alacklustre external picture. As a result, we expect the road and rail will display the largest gains vis-à-visair freight.

The Colombian economy is set for a sharp slowdown in the coming quarters, as the country struggles in theface of weaker trade dynamics and slowing household spending. Indeed, after real GDP growth of 4.6% in2014, we forecast expansions of just 2.9% and 3.4% in 2015 and 2016 respectively. Moreover, weexpect real GDP growth will remain weak over the coming five years, averaging 3.4% compared to 4.8% inthe past half decade, as the impact of weaker oil prices and falling crude production continue to temper thecountry's economic outlook. This will have a notable impact on the consumer sector, as lower employmentprospects will dent disposable income. In turn, demand for road and air freight will be impacted.