International Trade Secretary speech at the Colombia Business Forum

Speech delivered by the International Trade Secretary Dr Liam Fox at the Colombia Business Forum in London.

The Rt Hon Liam Fox MP

Colombia and the United Kingdom are long-standing allies, working together for shared peace and prosperity.

Yesterday marked the start of the first ever state visit to the UK by a Colombian President. It is a proud moment for both our nations.

Yet our shared history goes back to Colombia’s very inception as an Independent country.

More than 2 centuries ago Simon Bolivar came to London to seek British support for Colombian independence; he returned with 7,000 British soldiers, who fought for Colombia, along with substantial financial and technological support for the cause.

It was from this financial support from the City of London that the UK and Colombia built a great trading partnership.

British engineers constructed Colombia’s network of railways and other heavy industry, quickly developing this newly independent nation.

Deals that were struck within half a mile of where we now stand made a fledgling Colombia’s industrial dreams a reality.

Over the next 2 days, we hope that similar deals can be struck which will put our 2 countries on a path towards further economic and commercial integration to rival those great days of trade and commerce.

We have remained close partners on defence and security.

The UK has been Colombia’s third largest foreign investor over the past decade, and our trading relationship was worth £1 billion last year.

But it is also fair to say that British business has not developed and nurtured this relationship as well as we might have done.

We have fallen behind the likes of France, Germany and Spain in terms of trade with Colombia.

So today my key message is this; we need to redouble our efforts to re-forge this close bond, for Colombia is on the verge of an historic peace agreement.

And I’m delighted that today British businesses are signing up to support the peace process in Colombia.

Our own painful experiences of the troubles in Northern Ireland have taught us that peace processes are never easy.

They take courage and resilience, but the rewards that come from a lasting and sustainable peace are worth the years of negotiation and reconciliation.

One of the greatest success stories of the Northern Ireland peace process was the vast improvement in prospects for its people.

Within a year of the 1994 ceasefire, tourism to Northern Ireland had jumped by 20%.

Unemployment fell to its lowest level in 14 years, and over £30 million of new investment ventures were announced.

Businesses became a key lobbyist for peace.

Between 1994 and 2000, just under US$1.5 billion was invested in Northern Ireland by US firms.

Between 1989 and 1997 GDP per capita outpaced the rest of the UK’s, rising by more than a third.

By 2006, overall unemployment had fallen to 4.3%, from a high of 17% in 1984.

More importantly, by 2004 the unemployment gap between Catholics and Protestants had fallen below 4% for the first time in Northern Ireland’s history.

The message is clear – peace is good for business, and I also believe business is good for peace.

Colombia’s government has itself predicted a peace dividend worth up to 2% of GDP. No small amount.

My message to you today is that Colombia is now, more than ever, a land of commercial opportunity.

Just as foreign businesses were there to invest in Northern Ireland during its first steps towards a lasting peace, UK business must be there to do the same for Colombia.

Colombia has achieved decades of sustained growth, sound economic management and has never defaulted on a debt.

It has 14 free trade agreements in force; and 7 investment agreements, including with the UK and China. 

It is the fourth largest economy in Latin America with a GDP larger than the Republic of Ireland’s.

It is a leading member of the Pacific Alliance; the trade block of liberal economies along with Mexico, Peru and Chile which in total comprises 200 million people, 35% of Latin America’s GDP, and half its exports.

Colombian businesses are today emerging as leading global players.

Take Groupo Exito based out of Medellin – a city once derided for being the murder capital of the world is now proudly known as its innovation capital.

Exito is the leading Latin American retailer with operations in Colombia, Brazil, Argentina and Uruguay, and boasts revenues of US$10.6 billion.

We want leading Colombian businesses to see the UK as your hub for finance, innovation, research and development, providing the expertise to fulfil your global ambitions.

There are currently only 4 Latin American Banks with offices in the City of London.

But in the future, we want to see Colombian financial institutions taking advantage of the City’s wealth of expertise, expanding into our global markets.

We must set our ambition high; within 5 years, we must have halved the gap, on a GDP basis, between UK market share in Colombia and that of France and Germany.

Within 10 years we should be outperforming them.

This visit marks the start of that journey.

We know that it’s possible; in recent years there have been a number of remarkable success stories that illustrate perfectly the growing bonds of commerce and friendship between Britain and Colombia.

Arup established its Bogota office in 2014 after successfully bidding for a prosperity fund project.

Since then, with the support of DIT, is has been appointed as the lender’s technical advisor for 12 of Colombia’s major road concessions in deals worth over £5 million.

I am pleased to announce that 5 of these contracts have been awarded in the past 6 weeks.

This is a vital first step, and demonstrates how our government will work hand in hand with UK businesses to open new markets and create real opportunities across Colombia and the world.

Four years ago the British government began a campaign to bring Lloyds of London, the world’s leading insurance market, to Colombia.

Thanks to the strong and unwavering support of President Santos, last year Lloyds opened an office in Bogota in a move that will bring over £130 million in additional revenue into the UK insurance sector over the next 5 years.

Very recently, Airswift, a UK based company specialising in the recruitment of oil and gas personnel, signed a £10m agreement with Ecopetrol, the Colombian state oil company, and Anadarko.

This deal supports Colombia’s nascent offshore oil and gas industry for which the UK aims to be the partner of choice.

These deals mark the start of a new chapter in Anglo-Colombian relations, one that will see the prosperity of free and open trade form an unbreakable bond of friendship between our two nations.

With the signing of the double taxation agreement, we are in a position to put the trade and investment channel between our 2 countries on a more assured platform, making it easier for firms to do business.

KPMG, in partnership with the UK government, has today published a report on the scale of the infrastructure opportunities in Colombia.

Following a US$9.3 billion investment in roads, Colombia is now focused on developing transport logistics solutions, clean energy capabilities, mass transit and social infrastructure, such as hospitals, schools, government buildings and prisons, initiatives which require additional resources of more than US$55 billion.

Fortunately, the Colombian government have worked hard to create the regulatory and market conditions that favour private initiatives.

This explosion of private investment presents an unprecedented opportunity for British companies, and for Colombia.

The UK’s experience in public private partnerships, its leading position in developing social infrastructure and its global leadership in financial markets, mean we are the perfect partner for what Colombia will require for the next few decades.

I am delighted that our countries will form a working group to explore how the UK government’s appetite of up to £1 billion of UK Export Finance limits could be used to support peace-building projects with British business input, such as reliable renewable electricity for over 2 million Colombians living in off-grid areas, remote healthcare and the provision of safe drinking water.

Mansion House is the historic heart of Britain’s commerce, and today, history is made again as our 2 countries stand ready to build a new economic alliance, a partnership which will secure the prosperity of both our nations for generations to come.

The ties between us are warm, but as we move forward into the future, it is the ties of commerce and trade that will nurture the bond of friendship and fuel our shared prosperity.

Published 2 November 2016