Emerging Market Growth Story
One of the most impressive emerging market growth stories over the past several years has been Colombia; a country of 46 million people that has aggressively pursued pro-market reforms by reducing regulation, eliminating trade barriers and promoting foreign investment. Colombia has become a critical exporter of natural resources including oil, gold, coal, and coffee, all while continuing to develop trade partnerships with major consumers such as the U.S. and China. The Global X FTSE Colombia 20 ETF (GXG) provides investors with transparent access to this emerging economy, offering exposure to the top 20 companies listed on the Colombian stock exchange.
Fiscal Stability, Steady Growth
Colombia achieved steady growth at an annualized rate of 4.09% between 2001 and 2011. In 2012, the economy grew by 4%, exceeding the Central Bank's forecasts of 3.9%. In 2013, the GDP growth rate is estimated to increase to 4.3%, driven primarily by the mining sector, which has returned to near peak levels of activity (Colombian Central Bank, 2013).
Foreign Direct Investment (FDI) grew by 10.4% in 2012 to $15.8 billion. Sectors outside of energy and mining received 18.6% of these investments, which represents an increase of 104.8% from 2010 to 2012. (Colombian Ministry of Commerce and Trade, 2013)
In 2012, the World Bank's "Ease of Doing Business" indicator ranked Colombia as among the most favorable environments in South America to attract foreign investments.
Fiscal Stability, Steady Growth
Colombia has demonstrated a commitment to fiscal consolidation with the fiscal deficit falling to 2.3% in 2012, down from 2.8% in 2011. It also exceeded expectations and managed a slight budget surplus of 0.3% in 2012. (Reuters, 2013)
S&P and Dominion Bond Rating Service recently raised Colombia's credit rating from BBB- to BBB with a stable outlook. Between March 2011 and April 2013, Colombia's credit rating has improved twice, reflecting the country's improving macroeconomic conditions. (DBRS, 2013).
Oil production and exports have boomed in the last six years, with output of crude doubling from 0.5 million barrels/day to over 1 million barrels/day between 2005 and 2013. Oil exports have increased substantially from $5.5 billion in 2005 to $27.9 billion in 2011. Estimates expect these figures to reach $35.6 billion in 2014 (The Economist, Colombian Central Government, IMF, 2013).
As of 09/30/2013 1 Year Avg annualized since inception*
NAV -0.60% 26.10%
Market Price -2.33% 26.01%
Index -0.14% 27.24%
Total Expenses 0.68% 0.68%
The performance data quoted represents past performance. Past performance does not guarantee future results. One cannot invest directly in an index. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when sold or redeemed, may be worth more or less than their original cost and current performance may be lower or higher than the performance quoted. For performance data current to the most recent month end, please call 1-888-gxfund-1 or visit our website at www.globalxfunds.com
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