In our country, the paradox we are going through becomes evident: We are getting closer and closer to excellence in efficiency, which refers to the ability to do things well, with the least possible use of resources, but at the same time we are moving away from the translation that it must have for the satisfaction of interest groups and which is achieved by increasing effectiveness rates. We have outstanding business units, but we are not being able, as a country, to integrate these great efforts.
A clear example of this situation is found when analyzing the result of the Container Port Performance Index (CPPI) 2023developed by the World Bank and S&P Global Market Intelligence, published on June 4. This index measures the performance of 405 container ports worldwide, and indicated that Cartagena ranked 3rd and Buenaventura ranked 44th. We were the only country in the region to place two ports in the top 50.
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While in these scenarios that measure efficiency within ports we are improving with figures that astonish locals and strangers, the numbers that demonstrate effectiveness and are key to competitiveness are not the most encouraging. In the case of the Colombian portsefficiency is reflected in the speed and reduced cost of port operations. However, effectiveness is compromised by factors such as road and rail infrastructure, logistics and security.
Infrastructure
Determinant indices in competitiveness
The competitiveness of a country is measured through several determining indices, which we already had the opportunity to analyze for this same newspaper months ago. The conclusion is that according to the World Bank Logistics Performance Index (LPI)Colombia has shown improvements in the last decade, but has regressed in its logistics performance in the last five years. Factors such as the efficiency of customs clearance, the quality of trade-related infrastructure, transportation, and the ability to track and trace shipments are crucial to improving competitiveness.
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Currently, the National Planning Department (DNP) is updating the National Logistics Survey (ENL), in which it has identified the main challenges and opportunities of the logistics sector in Colombia. This survey is a key tool to evaluate and monitor the Colombian logistics system, and its information should be used to implement public policies that improve competitiveness indices. Without a doubt, an important opportunity to identify what we must improve and that must be reflected in the next measurement. National Logistics Costin which we also deteriorated between 2018 and 2022 (12.6% to 17.9%), this means that for every 100 pesos it costs a businessman to have his goods on the market, it takes up almost 20% in logistics . Which clearly reduces its competitiveness at an international level.
On the other hand, the OECD Economic Study for Colombia in 2024, published on September 17, highlights the importance of improving transportation infrastructure to boost the country’s economic growth and competitiveness. According to the report, the quality of transportation infrastructure in Colombia is poor, resulting in high transportation costs and limited regional integration.
Infrastructure
The study underlines that an interconnected transportation infrastructure is essential to promote balanced development throughout the country. Strengthening the capacities of subnational governments and improving equalization mechanisms in the fiscal transfer system are key measures to achieve this objective. Besides, The OECD recommends investing in the modernization of road and rail infrastructure to reduce logistics costs and improve the efficiency of freight transport.
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The study shows us how our public investment is low according to the percentage of GDP, where reference countries for us such as Peru are investing more than double ours (second only to Hungary), in the same way as citing figures from the Private Competitiveness Councila large portion of infrastructure investment is financed by the private sector.
The implementation of these recommendations would not only improve Colombia’s competitiveness, but also contribute to more inclusive and sustainable economic growth. Investment in infrastructure is crucial to overcome current challenges and harness the country’s development potential, facilitating trade and regional integration.
Infrastructure.
If we forget as a country where we want to get to and what it means to close the gaps with the TOP OECD countries We begin to blur what the purposes of Infrastructure and logistics are.
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Entities such as the DNP and UPIT must identify those key works that would help us in the short and medium term to improve competitiveness. We can easily be distracted by structuring works such as the interoceanic canal and complex railway corridors. A perfect example of this is the long-awaited deepening dredging of the access channel to Buenaventura that the Valley and the country are still waiting for..
We are talking about less than 1 billion pesos, in which there has been no commitment to put ourselves on par with the Pacific ports of LA. We structure projects worth hundreds of billions of pesos and we do not advance with achievable works that would imply comprehensive management of logistics corridors.
Road infrastructure.
Let us hope that we will soon return to the vision of infrastructure focused on competitiveness and reduce the gap with the OECD countries. And this is done by investing resources for Public Works and letting the private sector invest and have guarantees to recover their investment in Public Private Partnerships. We have a magnificent opportunity in the coming years with the takeoff of 5G projects, the Bogotá Metro and Private Initiatives that are advancing with Territorial Entities.
And these are not resources that compete with social works or that solve the needs of water, education, health, etc. Without competitiveness we will not get the resources. Nothing gives nothing.
ALVARO GUTIÉRREZ
Managing Partner of Almabro.
