(Bloomberg) -- Colombia suffered another year of weak economic growth as the oil, gas and coal sectors contracted while tight monetary policy held back manufacturing.
Gross domestic product expanded 1.7% in 2024 from a year earlier, which compares to a median estimate of 1.8% by analysts surveyed by Bloomberg. Even so, that was better than the expansion of 0.7% the previous year.
Output rose 2.3% in the fourth quarter from year earlier.
Oil and mining contracted 5.2%, while manufacturing contracted 2.1%. Growth was led by the agricultural sector, which registered 8.1% growth, alongside entertainment services, which expanded the same amount. Activities related to coffee expanded 22.5%, boosted by high prices.
President Gustavo Petro was elected in 2022 pledging to gradually phase out oil and coal, the nation’s two biggest exports. Since he took office, he has refused to issue any new oil exploration licenses.
The central bank has defied pressure from Petro, the finance ministry and the banking lobby to cut interest rates faster to revive economic growth. That may soon change, however, when two new board members appointed by Petro join the board in March, potentially leading to a more dovish stance.
Policymakers halted their easing cycle last month over concerns that inflation isn’t cooling fast enough.
The finance ministry estimates that the economy will expand 2.6% this year. Last month, the economy narrowly avoided a devastating shock when US President Donald Trump threatened to impose a 25% tariff on Colombia in a dispute over migration.
(Adds Petro’s energy policies in fifth paragraph.)
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