Is the slump in the global economy affecting Colombia and Latin America?

[beginthebeguin]

I have noticed there is a definite change in 'tone' to the Latin board concerning how life in general has started to deteriorate a little in Latin America (especially Colombia since the majority of posters concentrate on that county).  Granted you are always going to have some urban chaos in any of the cities but is it starting to become noticeable to the Colombianos you interact with?
Compared with the 2007-2008 posts, this year's posts to the board are especially less optimistic.
And indications with the Colombianas I chat with indicated that economic issues are starting to get a little more dire.     

[robert angel]

They say that in economic terms, that when the USA sneezes, the rest of the planet catches a cold. Perhaps some areas had a little more resistance and in the last twenty years, maxims and old fashioned sayings like the above don't always follow exact;ly as they used to, but maybe our problems are catching up with them.
 
To differing extents, they blame Europe's economic woes on the USA and attribute China's slowdown along with the resultant lowering of oil prices to us also.

[beginthebeguin]

Sorry Bob I was hoping for a little more micro insight rather than macro. I can always get macro generalities from CNBC and the FT (if I had one of those overpriced subscription jajajaja).
There have been so many posts about Colombianas here recently I decided it is much easier to fathom global economics rather than figure out women. jajajajaja

[Researcher]

    I don't know if Alabamaboy is reading the forum these days but he seems to have a good grasp on the recent economic conditions in Colombia.Maybe he will chime in.My wife's family seems to be doing OK.

     Researcher

[beginthebeguin]

Researcher sez

I don't know if Alabamaboy is reading the forum these days but he seems to have a good grasp on the recent economic conditions in Colombia.

  Yeah but that is only from BAQ though. We all could use info from all over Colombia and beyond if a all possible. 

[Researcher]

   No BTB, I think AB has been keeping up with Colombia's economic situation for a while now.Not just BQ but the whole country.He had plans to retire there I think.

   Researcher

[AndyLee]

Yes, the economy is becoming troubled in Colombia, reflecting what's happening in the rest of the world. Last week President Santos said he would convene a meeting of business and government leaders to begin planning how to head off the coming disaster. Tourism has dropped based on hotel occupancy which is down by anywhere from 10 to 15 percent from Bogota to Medellin to Cartagena.
Locally I've seen interest rates on mortgage loans go from .05 to 10.3 percent and now they are asking for 30% down instead of used to be 20%, that's a pretty big jump. My friend has a house on the market near Cali and in August was getting two or three inquiries a week and now isn't getting any inquiries.
The huge rains last year and earlier this year did a huge amount of damage, something like 80% of the highways in the country have at least one section closed or reduced to one lane. This has slowed traffic, especially trucks which increases the costs of transporting goods. Gasoline continues to increase in price. All these things indicate the [snip] is about to hit the fan here, too.
i read the news daily from the US and things still aren't looking too good there. Some predictions are for another recession as bad as the last one.
Many Colombians depend on income from family members in the US. In one little village of 15,000, Santuario, Risaralda there are estimated 800 living and working in the US. Slowly they are making their way back to Colombia because they are losing their jobs in the US. Most of the ones I talked to were women working as hotel maids and men working as construction workers. I saw one interesting conversation in Santuario where a Colombian guy returned after being a roofer in the US for 8 years where he was making $25 hour in Englewood, NJ. In Santuario they offered him a job as a concrete worker for $17 day. Instead he took a job as a bus driver making $20 day. Good choice in my estimation. That was in April and since then the guy's wife and his sister and her sister have all lost their jobs in Englewood, NJ and have returned to Santuario to live with his mother. Between the 3 of them they won't make as much in a day as they used to make in one hour in the US.
Another guy from Santuario has been working in New York City for many years as part of an environmental clean up crew and he go laid off there. Fortunately he has been sending money every month to his mother in Santuario and she purchased two small coffee farms for him so at least he has a job of sorts now that he is back in Santuario.
And the list could go on, but the short answer to your question is that in my estimation the economy in Colombia is constricting apace with the world economy.


Is that the kind of answer you were looking for?
You might also ask what does it mean for gringos looking for a wife? In my opinion it means our odds, which have already been very favorable, are now much better. With so many people out of work a gringo with a pension looks might good to some of these women.
By the way, if anyone is interested, my fiancee and I have a few female friends who are looking for gringo boyfriends. So if you are interested in living in Colombia let me know, maybe I can fix you up . One lady in particular I like a lot. She is 50, slender, attractive, intelligent, retired school teacher and is well educated, has one child, a son 26 who is a Spanish teacher in local school. The lady is divorced, owns two houses, a car, two motos and has two pensions. She would be an excellent catch, problem is she really wants to live in Colombia.

[raycjs]

my girls familly is doing well and other then the exchange rate being low every thing else seams the same. i have been looking at homes in colombia BAQ area in the last few months and they seam to be lower then they where a year ago so this seams to be the same as in the US.

[AndyLee]

my girls familly is doing well and other then the exchange rate being low every thing else seams the same. i have been looking at homes in colombia BAQ area in the last few months and they seam to be lower then they where a year ago so this seams to be the same as in the US.

Yes, the prices are going down for real estate, my friend lowered her price 20% after going 3 weeks without any inquiries. So far still no new inquiries even at the reduced price.
BUT, just like in the US in 2007-2008 there are new houses going up on every street. In one small pueblo I saw maybe 50 houses under construction, but most of them have got up the second floor with the bricklaying and have stopped, which means they don't have a buyer yet who will pay to finish the house.

[raycjs]

Andylee
 
thank you for reconfirming what i was being told. it is the same all over the US the housing market is way off the only good thing about all of this is the interest rates are at a all time low.
 
 
Ray

[Alabamaboy!]

    I don't know if Alabamaboy is reading the forum these days but he seems to have a good grasp on the recent economic conditions in Colombia.Maybe he will chime in.My wife's family seems to be doing OK.

     Researcher

Out of the 7 adults living in my wife´s family´s home only one sister is working 2 days a week at a fast food place in the mall and another sister doing some manicures from the home. The father with a small pension from the police department. Her barrio is a complete disaster zone, all the roads torn up for some kind of pipes which they are not even working on. Other parts completely wiped out by flood waters in the arroyos. It seems to be a borderline desperate situation to me there and in many parts of BAQ area.
 
Bogota also looked pretty sad. The hotels all seem pretty empty. The hotel we stayed in while in BOG had like 20 rooms listed on the breakfast sign in sheet and we usually ate right at the end of the allowable time and several days there were only a few other names listed.
 
I have been reading the news here though and they are reporting like 5.4% economic growth. But I don´t see it.
 
There are a bunch of labor strikes for the petroleum company Pacific Rubiales and some other mining companies. Other riots in different parts of the country for lack of services, usually in poor sectors. Also a lot of reporting regarding the spiking violence in general, especially with FARC and other groups.
 
Meanwhile it seems like the price of everything is going up a lot.
 
Bogota seemed outrageous with a lot of the prices I saw.
 
The malls all seem to do well though. Seems like the mall food courts are always packed. The other stores have a lot less traffic and it never seems like anyone has a bag in their hand from any kind of purhases.
 
IMO the malls seem to be a giant money laundering system.
 
I cannot recall seeing more than a couple gringos in Bogota and they were from the UK or Australia with the accent. There are a heck of a lot of Chinese there though. And many of them I saw at DAS and the Ministerio getting their cedulas and visas.
 
I have not seen another gringo yet in BAQ after 4 days here. The hotel I am staying in is basically empty. The little corner liquor store which usually plays Vallenato music every night and is usually packed, even on weekdays, is empty every night.
 
A bunch of houses I was looking at to possibly buy several years ago are still for sale.
 
My wife had to have her tooth fixed here in BAQ yesterday and her friend who works at the dentist has a visa to come to the US but is not, because the situation is perceived to be even worse in the States for overall quality of life if you can believe that.

[beginthebeguin]

Excellent infomation so far. Now that is interesting about the condition of the road and national highway infrastructure. I was under the impressioon that the national government in Bogota granted a large sum of funds to the northern departments since those were the departments most affected by the winter rains. So now it seems that the transportation infrasturcture is deteriorating in more than just the north. This is something I had not considered. Must be one of the many reasons for the rise in food costs that my contacts have been warning me about.
Sounds like the PRC will think twice about those long term investment projects that had planned for Colombia especially.
Yes, I think this discussion thread is firming up. But lets not limit it to just real estate values. 

[AndyLee]

Out of the 7 adults living in my wife´s family´s home only one sister is working 2 days a week at a fast food place in the mall and another sister doing some manicures from the home. The father with a small pension from the police department. Her barrio is a complete disaster zone, all the roads torn up for some kind of pipes which they are not even working on. Other parts completely wiped out by flood waters in the arroyos. It seems to be a borderline desperate situation to me there and in many parts of BAQ area.
 
Bogota also looked pretty sad. The hotels all seem pretty empty. The hotel we stayed in while in BOG had like 20 rooms listed on the breakfast sign in sheet and we usually ate right at the end of the allowable time and several days there were only a few other names listed.
 
I have been reading the news here though and they are reporting like 5.4% economic growth. But I don´t see it.
 
There are a bunch of labor strikes for the petroleum company Pacific Rubiales and some other mining companies. Other riots in different parts of the country for lack of services, usually in poor sectors. Also a lot of reporting regarding the spiking violence in general, especially with FARC and other groups.
 
Meanwhile it seems like the price of everything is going up a lot.
 
Bogota seemed outrageous with a lot of the prices I saw.
 
The malls all seem to do well though. Seems like the mall food courts are always packed. The other stores have a lot less traffic and it never seems like anyone has a bag in their hand from any kind of purhases.
 
IMO the malls seem to be a giant money laundering system.
 
I cannot recall seeing more than a couple gringos in Bogota and they were from the UK or Australia with the accent. There are a heck of a lot of Chinese there though. And many of them I saw at DAS and the Ministerio getting their cedulas and visas.
 
I have not seen another gringo yet in BAQ after 4 days here. The hotel I am staying in is basically empty. The little corner liquor store which usually plays Vallenato music every night and is usually packed, even on weekdays, is empty every night.
 
A bunch of houses I was looking at to possibly buy several years ago are still for sale.
 
My wife had to have her tooth fixed here in BAQ yesterday and her friend who works at the dentist has a visa to come to the US but is not, because the situation is perceived to be even worse in the States for overall quality of life if you can believe that.

Another excellent report AB, thanks for taking the time to put it online.
(I'm hoping the number of Chinese in BAQ means eventually we'll get decent Chinese Food in this country?)
Part of the deal with the Chinese is the recent FTA with China, and the number of Chinese who are looking outside their own country for economic opportunity.
Then there's the money laundering.
I think I mentioned earlier on this board that I live in the Wine Capital of Colombia. I live in the Andes version of Napa Valley. From my (3rd floor) penthouse my view is of miles of grape vineyards in the valley and miles of shrubs and sparse grass clumps on the hillsides. All the hillsides in this North Valley were covered with coca when my fiancee moved here 20 years ago. The drug lords built schools and universities. At one time there were 5 universities in Roldanillo, a small city of 25,000 people. Now only 1 remains.
The drug lords found a way to launder money by starting a wine industry Casa Grajales with a huge winery in a building about 500 meters x 500 meters. A gallon of the best wine costs $18.


When the drug lords were captured the government confiscated the winery and the vineyards that employed about 2,000 people by that time and was the biggest employer in the North Valley of Valle Del Cauca Departamento. Rather than close the wine industry and put the twin cities of La Union and Roldanillo into bankruptcy the government took over management. Now the Colombian Government is the largest wine producer in South America, and the worst I might add. The wine sucks, but the Colombians seem to like it when they can't find the Chilean or Argentinian wines on the shelf.

[Alabamaboy!]

Andy the Chinese I was referring to were in Bogota, not BAQ. I have not seen many Chinese here in BAQ.

[InSanDiego]

I didn't see a single person of asian descent in BAQ in my 8 day trip in August...And my hotel was half full...

[robert angel]

I am surprised there aren't any Chinese restaurants in the largest cities in Colombia. Seems to me that there are Chinese restaurants just about everywhere. One of the best Chinese restaurants I've eaten at was in the city of Cork, Ireland--which also had a Jewish mayor at the time, which surprised me also.
 
Maybe it was just because the food in Ireland overall was so bad that the Chinese food seemed that much better, and I was drinking a lot of stout, ale and scotch at the time, as I recall....

Do they have McDonalds in Bogota, Baq. & Medellin? I hope not!

[whitey]

I am surprised there aren't any Chinese restaurants in the largest cities in Colombia. Seems to me that there are Chinese restaurants just about everywhere. One of the best Chinese restaurants I've eaten at was in the city of Cork, Ireland--which also had a Jewish mayor at the time, which surprised me also.
 
Maybe it was just because the food in Ireland overall was so bad that the Chinese food seemed that much better, and I was drinking a lot of stout, ale and scotch at the time, as I recall....

Do they have McDonalds in Bogota, Baq. & Medellin? I hope not!

Hey Rob:

There are many Chinese restaurants in Barranquilla - one just 2 blocks away from my wife's house. 

There are also McDonald's, KFC, etc in all the major cities in Colombia ... yeah I know ... I was disappointed too ...

[fathertime]

There are also McDonald's, KFC, etc in all the major cities in Colombia ... yeah I know ... I was disappointed too ...

McDonalds isn't my cup of tea, but the ladies seemed to think it was a treat to eat there in Cali.  The burgers there treat my system almost as bad as the Barranquillian water did.


Fathertime! 

[mudd]

Do they have McDonalds in Bogota, Baq. & Medellin? I hope not!

medellin, mc donalds is  always busy and full of people

Andy the Chinese I was referring to were in Bogota, not BAQ. I have not seen many Chinese here in BAQ.

last few trips in medellin, i saw some Chinese looking at commercial property here and there,  probably getting ready to start cheap companies and bring in cheap Chinese labor.

[AndyLee]

Yes, there are Chinese Restaurants throughout Colombia but I have yet to find a good one. The food is mediocre at best. They all taste like I remember from school cafeteria.


There are MacDonald's everywhere, too. They have good coffee behind the counter but the coffee bar is very expensive. I go for the free wifi. The one in Medellin has a nice lounge for wifi. Dunkin Donuts are everywhere, also very expensive. For example, coffee in MacDonalds or Dunkin Donuts is 2800 or 3200 pesos, across the street in the panaderia is 800 or 1000.

[AndyLee]

Here is an interesting article about tourism increases in Colombia. It goes to show the way news is manipulated here. The government says tourism is up 19% but in an article last week the hotel industry says hotel occupancy is down 13%. I wonder if it is because of all the new hotel rooms they are building. A similar over building happened  in the US a few years back.
 
Quote
Tourism is booming in Colombia according to new figures that show a 10% increase in foreign visitors and a 19% rise in income from travel so far this year.sponsor:
Colombia Travel Agent - Mantaraya TravelSpeaking at a forum to mark World Tourism Day, Minister for Commerce, Industry and Tourism Sergio Diaz-Grandados announced the latest DAS statistics showed 1,066,709 foreigners visited Colombia in the first half of 2011, up from 963,685 in the same period last year.
The largest proportion of visitors was from the U.S, with 225,103 people, followed by visitors from neighboring countries Venezuela and Ecuador. However, the biggest increase in visitors was from Brazil, which saw a 51% increase, followed by Chile and Canada.
The surge in visitors also led to a sharp increase in income. According to the minister, travel and transport generated $781 million in foreign currency in the first trimester of 2011, up from $655 million last year.
Diaz-Grandados also announced the increase in tourism had helped fuel a hotel construction boom and expansion in air travel.
According to the minister, by the end of the year 3,213 new hotel rooms will have been built in 26 construction projects around the country. This will take the total figure to 15,448 rooms over the period of 2004-2011.
He added Colombia had also expanded four air routes in 2011, improving both national and international connections.
The minister said, “we need to give proper attention to tourism, which is why the government is committed to getting Colombia to offer world class tourism.”
He added the country was getting closer to the government target of 4 million foreign visitors and $4 billion in foreign exchange from tourism a year by 2014
End Quote

[Alabamaboy!]

I just saw in the BAQ newspaper that the amount of freight traffic through the port of BAQ is up 56% over last year! And last year was up like 35% over the previous year. So someone is making some cash. But it sure does not seem to be helping the average Colombian. Actually seems to be hurting them, because prices seem to be rising for pretty much everything. And although the cities are putting more cash into projects to improve tourist and commercial areas, very little seems to be happening in the lower estrato places....it actually looks much worse than before and appears to be continuing to deteriorate. At least in BAQ/Soledad.

[AndyLee]

Milk went from 1800 to 2150 seemingly overnight, and my Internet went from 66,000 to 80,000 this month. Just two examples of inflation in motion.

[robert angel]

What has happened to the price of corn recently, as well as in the last ten years or so?

[SJ]

  The price of corn? Are you asking because of ethanol?