With this article, I would like to take you back to our world tour of representatives and head to Colombia, South America. The Department of Commerce has been working with Broggini lately to help our Washington companies identify new aerospace opportunities in this fast growing sector. In this issue, Broggini is sharing some valuable data on the Columbian aerospace market.
The development of the aerospace market has become, in the past years, one of the priorities for the Colombian government because of the increasing relevance that the country has gained in the region. Colombia profiles as an attractive target for the sector because of the growth of air traffic in the country, becoming one of the key actors in Latin America.
To achieve this development, the Colombian public institutions, private companies and associations are working together to face the challenges and guarantee synchrony and efficiency in the process.
Colombia: a Key Country in the Region for the Aerospace Sector
Colombia is a strategic country due to its geographical position connecting different states and continents, mainly the Americas.
In 2019, according to the Colombian Ministry of Transport, air traffic increased in the country by 9.1 percent with the operation of 40 new international and domestic routes and the entry of four new airlines, allowing an increase of 34 million passengers, compared to 2018.
El Dorado, located in Bogotá, D.C., is one of the most important and transited international airports in Latin America, ranked first for cargo traffic and second for passenger transportation. Between 2016 and 2019, the cargo transportation surpassed one million annual tons, and passenger transportation reached 75.5 million in 2019, according to the Civil Aviation Authority of Colombia.
The governmental platform, Invest in Colombia, explained that Colombian airports in 2019 operated 5,740 domestic flights weekly and 1,171 direct international flights, connecting 27 countries directly with 26 airlines present in the country.
The continuous growth of the air operations in Colombia has generated the opening of more than 96 MRO shops (Maintenance, Repair, and Overhaul). Invest in Colombia stated that in 2018 these companies completed 48,000 aircraft MRO services.
In 2016, Avianca, the flag carrier of Colombia, opened its own MRO 44,300- square-meter facility, investing $50 million at José Maria Córdova International Airport, near the city of Medellín.
Aerospace Market in Colombia
The Colombian market of aerospace parts is based on imported products. Between 2019 and 2020, imports grew from $127 million to $135 million, having a compound annual growth rate of 6.37 percent.
Due to the increased importance of the aerospace market in Colombia, the government is working together with the private sector by creating and funding clusters and initiatives, in partnership with domestic (private) aerospace associations. These clusters seek to generate technical knowledge and capacities for local companies. The cluster located in the Antioquia Department provides a space for the acquisition of technical skills for training, and maintenance, overhaul and repair services, as well as parts manufacturing.
Opportunities for Washington Companies
Colombia is working to become a regional and international reference for the aerospace industry, creating great opportunities for international investment in the country. The following initiatives create ideal conditions for commercial and technical alliances between Colombia and foreign companies in the industry.
- In 2020, the government created the Space Development Public Policy, aiming to support the development of the space sector seeking not only to strengthen public investment, but also to establish Colombia as an international player in the industry, contributing to the diversification and sophistication of the aerospace market. With this policy, the government is also looking to stimulate foreign monetary and technical investment.
- Due to the high and continuous growth of the Colombian air traffic, and the importance and relevance of El Dorado International Airport in the region, new technologies for the production of aircraft parts and MRO services, as well as technical knowledge, are constantly needed. With the lack of in-house technology, there is a unique opportunity for foreign companies seeking strategic local partnerships.
- There are internal conditions implemented by the national government that allow international aerospace companies to enter into the country. Since 2010, six international projects have located and developed in Colombia with a total investment of $144 million. Airbus, Aerosync and Barfield are some examples of companies that have recently expanded operations in Colombia.
- Colombia has international free trade agreements with Europe and North America, eliminating trade tariffs for foreign aerospace products.