Colombia | Current account deficit was 2.0% of GDP in Q1 2024

Summary

In the first quarter of 2024, the current account deficit represented 2.0% of GDP, decreasing 1.7 pps compared to the first quarter of 2023. The reduction in the deficit was partly explained by a trade deficit that narrowed from 2.8% of GDP in the first quarter of 2023 to 2.0% in the same period of 2024.

Key points

• Key points:
• In the first quarter of 2024, the current account deficit was US$1.924 billion, a decrease of 1.7 percentage points compared to the first quarter of 2023, from 3.7% to 2.0% of GDP.
• From trade in goods and services, imports, which fell to a greater extent than exports, allowed the trade deficit to close. With this, the trade deficit went from representing 2.8% of GDP in the first quarter of 2023 to 2.0% in the same period of 2024.
• The deficit in primary income represented 3.4% of GDP, and decreased by 1.4 pps compared to the first quarter of 2023. Secondary income grew by 7.6% and represented 3.4% of GDP.
• Foreign direct investment, which finances the current account, decreased by 11.9% compared to the first quarter of 2023. Despite this, it represented 3.7% of GDP and was more than enough to finance the current account deficit.
• Going forward, we expect the recovery in economic activity to provide a boost to imports, putting upward pressure on the current account deficit, especially during the second half of the year.

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