{"id":84523,"date":"2025-04-16T10:07:44","date_gmt":"2025-04-16T15:07:44","guid":{"rendered":"https:\/\/mascolombia.com\/how-trumps-trade-war-will-affect-colombias-trade-balance\/"},"modified":"2025-04-16T11:46:57","modified_gmt":"2025-04-16T16:46:57","slug":"how-trumps-trade-war-will-affect-colombias-trade-balance","status":"publish","type":"post","link":"https:\/\/mascolombia.com\/en\/how-trumps-trade-war-will-affect-colombias-trade-balance\/","title":{"rendered":"How Trump\u2019s trade war will affect Colombia\u2019s Trade Balance"},"content":{"rendered":"\n

Donald Trump\u2019s tariff measures could directly affect 33% of Colombian exports to the United States and indirectly affect the rest of the country\u2019s trade flows, including those with the European Union, China and Latin America.<\/p>\n\n

At least one third of Colombian exports to the United States are oil and coal (products exempt from Trump\u2019s tariffs); key sectors such as processed foods (15% of exports to the US), could have a moderate impact; and high value-added manufactures (9%), will face higher barriers.<\/p>\n\n

You may also read: China strikes back and hits big U.S. companies<\/strong><\/a><\/p>\n\n

Added to this are the risks of higher import prices for critical inputs, from machinery to fuels or chemicals. The impact on trade with other countries will be negative, as Trump\u2019s measures will distort prices in international markets, increasing international trade costs.<\/p>\n\n

The tariff barriers imposed occur in a context of high trade deficit for Colombia. In 2024 the country recorded a negative balance of USD $10.8 billion, 11.7% more than in 2023.<\/p>\n\n

This imbalance is equivalent to 21.8% of exports, 18% of imports or 70% of international reserves, which are used to facilitate access to the international capital market and to implement foreign exchange intervention by Banco de la Rep\u00fablica.<\/p>\n\n

Regarding public accounts, in 2024, the trade deficit represented 8.8% of the National General Budget<\/a>, 44% of investment and 46.6% of the budget for debt payment. In fact, the deficit is equivalent to 90% of the government\u2019s cash shortfall at the end of the year.<\/p>\n\n

\"Washington
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Exports that are spared<\/h2>\n\n

According to the White House announcements, most Colombian exports would have a low or moderate impact. In 2024, 32% of exports to the United States were petroleum and coal, products exempted from the \u201cliberalization day\u201d measures.<\/p>\n\n

Also exempt would be the manufacture of products derived from oil refining, which accounted for 8% of Colombia\u2019s exports to the US in 2024. As well as gold, included in the exemption of Trump\u2019s measure on imports of precious metals, which accounted for 10% of Colombian exports to the northern giant.<\/p>\n\n

Green coffee, that is, without any processing, could be exempted from the tariff measures or have a low impact, as the United States would be more interested in the roasting, grinding and processing processes. This product represented 9.2% of exports to the USA in 2024. <\/p>\n\n

Some agricultural exports could be exempted because they are not produced in the United States. They represented 16.7% of exports to the USA in 2024 and are explained by the cultivation of cut flowers, which represents 80% of this basket, and tropical fruits (bananas, lemons, uchuva) and some spices and medicinal plants which, with flowers, complete 98% of agricultural exports.<\/p>\n\n

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<\/figcaption><\/figure>\n\n

Exports directly affected<\/h2>\n\n

The food and beverage industry, which in 2024 accounted for 15% of Colombian exports to the United States, could face difficulties. Products such as palm oil, sugar, freeze-dried soluble coffee, coffee or chocolate extracts, essences and concentrates, chocolates, candies, confectionery and in general all processed foods, will face greater competition if the United States is interested in moving food processing to its country. Something that will depend on the importance that Trump gives to these industries considering their low added value.<\/p>\n\n

The most affected exports will be medium or high value-added manufacturing, which account for 9% of Colombian exports to the United States. This group includes goods from activities such as: clothing manufacturing, manufacture of plastics and plastic products, manufacture of soaps and detergents, perfumes and toiletries, manufacture of machinery and equipment: motors, electric generators, etc., among others.<\/p>\n\n

\"Colombian
<\/figcaption><\/figure>\n\n

You may also read: China responds strongly to Trump\u2019s tariffs: how the global economy is shaken up<\/strong><\/a><\/p>\n\n

Impacts on Colombia\u2019s Trade Balance<\/h2>\n\n

Trump\u2019s measures will have contradictory effects. On the one hand, the trade war with China will make the terms of trade in global value and supply chains more expensive because China is one of the main suppliers of manufactures to Colombia, Latin America and the United States and the world.<\/p>\n\n

On the other hand, trade barriers could generate an oversupply in international markets, especially for consumer products, which will be transferred to less protected markets, such as Colombia.<\/p>\n\n

The indirect impacts on Colombia\u2019s international trade are due to the imbalance in the Trade Balance, which is mainly explained by the imbalances with China (USD $12,391 million), the European Union (USD $2,970 million), Brazil (USD $1,240 million), Mexico (USD $1,175 million) and the United States (USD $1,191 million). <\/p>\n\n

Colombia\u2019s trade deficit with the United States is explained by imports of mining and oil industry products (23%), chemical products (18.7%), agricultural products (12.5%), food and beverages (11.5%), and machinery and equipment (10.2%). These products will become more expensive because U.S. industries will face higher costs in imported inputs due to tariff measures.<\/p>\n\n

These deficits are partially offset by trade surpluses with ALADI countries (Latin American Integration Association, which promotes regional economic cooperation) and the Andean Community (a subregional bloc comprising Bolivia, Colombia, Ecuador, and Peru).<\/p>\n\n

In 2024, the main positive balances were with Ecuador (USD $1,143 million), Venezuela (USD $883 million), Peru (USD $327 million) and Chile (USD $235 million).<\/p>\n\nhttps:\/\/mascolombia.com\/en\/trumps-tariffs-hit-colombia-manufactures-flowers-and-coffee-among-the-hardest-hit\/

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The escalation of the trade war between the United States and China will hit the Colombian economy. In particular, these changes threaten to aggravate the trade imbalance and the country\u2019s macroeconomic and financial stability.<\/p>\n","protected":false},"author":1,"featured_media":84518,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"rank_math_focus_keyword":"trade balance, trade war, Trump","rank_math_title":"","rank_math_description":"","rank_math_primary_category":"5","footnotes":""},"categories":[753],"tags":[1281],"mc_distribution":[687,989],"class_list":["post-84523","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-international-trade","tag-articulo-en","mc_distribution-gerentes-y-propietarios","mc_distribution-suscriptores-generales"],"acf":{"euro":0,"dolar":0},"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/mascolombia.com\/en\/wp-json\/wp\/v2\/posts\/84523","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/mascolombia.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mascolombia.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mascolombia.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/mascolombia.com\/en\/wp-json\/wp\/v2\/comments?post=84523"}],"version-history":[{"count":0,"href":"https:\/\/mascolombia.com\/en\/wp-json\/wp\/v2\/posts\/84523\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/mascolombia.com\/en\/wp-json\/wp\/v2\/media\/84518"}],"wp:attachment":[{"href":"https:\/\/mascolombia.com\/en\/wp-json\/wp\/v2\/media?parent=84523"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mascolombia.com\/en\/wp-json\/wp\/v2\/categories?post=84523"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mascolombia.com\/en\/wp-json\/wp\/v2\/tags?post=84523"},{"taxonomy":"mc_distribution","embeddable":true,"href":"https:\/\/mascolombia.com\/en\/wp-json\/wp\/v2\/mc_distribution?post=84523"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}