Colombia | The economic activity recovered strongly at the beginning of 2021

Summary

In the first quarter of 2021, GDP grew 1.0% compared to the same period of 2020 and had a significant increase of 2.9% compared to the previous quarter. The economic dynamics went from less to more, as at the beginning of the year it was affected by the confinements located in many cities of the country.

Key points

• Key points:
• Domestic demand continues to be the main support for the economic recovery, although exports are already showing a better performance at the margin.
• Household consumption performed better in goods (4.0% yoy) than in services (-0.5% yoy), the latter still affected by restrictions on social interaction sectors, especially at the beginning of the year.
• Machinery investment is 17% above its pre-pandemic level, while construction is 18% below its previous levels.
• The pandemic-related confinements that occurred in April and early May and, more importantly, the economic effect of the protests in Colombia may reverse the dynamism of the economy at the end of the first quarter.
• Although, undoubtedly, the second quarter will have a growth compared to the same period a year ago, because at that time the economy was in a much greater confinement, its performance compared to the first quarter may reflect a quarter-on-quarter decline.

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