Export of complex products: 4 success stories for Colombia

June 30, 2023

Besides coffee or flower exports, Colombia is also on the road to the export of complex products. Here is a list of the first four.

pipe, iron pipe fittings, iron, sound recording stands, analog sound, bends, cures, office accessories, staples, Más Colombia

Two U.S. university professors led the way in creating an indicator to analyze the export of complex products by different countries, a crucial factor in assessing their level of development and whether national foreign trade policy is on the right track.

Ricardo Hausmann, of Harvard University, has been leading the Atlas of the economic complexity of countries for two decades. Almost simultaneously, Cesar Hidalgo started an index with the same purpose at the Massachusetts Institute of Technology. Currently, it is updated by an independent organization from academia and published in the Observatory of Economic Complexity (OCE), a benchmark on the subject.

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With information from the OCE, it is possible to know which are the most complex exports of Colombia. Below is a list of the four groups that lead the export of complex products from our country.

1. Iron pipe fittings

Iron pipe fittings occupy the first place in the export of complex products from Colombia. The best known are elbows, sleeves, and fittings. Out of 1,024 world trade products rated in the ECO, iron pipe fittings rank 125th in terms of complexity.

The main exporters of this product in 2021 were China (with 5.2 billion dollars), Germany (1.88 billion dollars), Italy (1.74 billion dollars), and the United States (1.64 billion dollars), according to information from the same observatory. Colombia ranked 36th, with exports of US$67 million.

This product began to be exported with great vigor from Colombia in 2017 when it reached 39 million dollars. In the immediately preceding year (2016), it barely reached US$10 million, a value that corresponds with what was exported on average up to that time, as can be calculated with information from DANE.

The main destinations for iron pipe fittings exported by Colombia are the United States, to which it exported almost US$50 million in 2021, 74% of total exports of this product; Canada, to which it sent a total of US$13.4 million in 2021; and Ecuador, to which it exported US$1.74 million in 2021.

2. Sound Recordings

In second place are Discs, tapes, and other sound recording media. These products occupy 124th place in terms of complexity in the ECO ranking.

The countries that dominate exports worldwide are Germany, the United States, France, and the Netherlands, with 180, 179, 166, and 144 million dollars, respectively. Colombia is the 37th exporter of this product, with 4.71 million dollars in 2021, according to information from the Economic Complexity Observatory.

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In 2021, the main destinations for Colombian exports of records, tapes, and other sound recording media are the United States, with 4.5 million dollars, and El Salvador, with 183 thousand dollars, according to DANE. Thus, the North American country reiterates its position as the main destination for complex products exported from Colombia.

3. Bandages

The following product is classified by the CLO under the category “bandages”. It includes wadding, gauze, bandages, impregnated pads, plasters, and similar articles. Bandages are ranked 198th in the Observatory’s product complexity ranking.

In 2021, $9.2 billion of this product was traded worldwide. The countries that dominated the export of complex bandage products were China, with $2.3 billion; the United States, which exceeded $934 million; Germany, which exported $875 million; and the United Kingdom, with $675 million, according to ECO information.

That same year, Colombia exported 22 million dollars in bandages, making it the 36th largest exporter of this product in the world. From DANE information, one can see that the main export destinations were Mexico, Ecuador, the Netherlands, the United States, and Argentina, in order of importance.

4. Metal office supplies

Another group of relevance for Colombia within its basket of export of complex products is denominated by the ECO as “metal office supplies”. This includes binding mechanisms for binders, fasteners, clips, sign indexes, staples, and similar articles made of metal. These supplies rank 288th out of 1,024 products rated.

Globally, China is the main exporter of this product, with external sales of more than 514 million dollars in 2021. The second exporter is Germany, far behind China, reaching 51 million dollars that year, 10% of the Asian country. Colombia was the 32nd exporter of this product, with 2.2 million dollars, according to the OCE.

The main destinations of Colombia’s exports in metal office supplies are Mexico, which in 2021 bought almost 1.4 million dollars from us (more than half of all exports of this product), and Ecuador, which reached 300 thousand dollars, according to information from DANE.