OBG talks to Juan Camilo Restrepo, Former Minister of Agriculture and Rural Development

Interview: Juan Camilo Restrepo

What is the ministry’s attitude to foreign acquisition of land for agricultural investment?

JUAN CAMILO RESTREPO: The Colombian government has been firm in its position that foreign investment in land is fundamental for our country. This is actually referred to in a bill drafted in November 2012, set for approval by Congress in 2013. Even as the bill awaits passage, foreign investment is welcome, as long as it generates employment, increases exports and the acquisition of land is properly recorded. The government believes investment should be transparent so that we know the level of investment, who is coming, what they will work in, what technology they will bring, what experience they have, whether they will export (or serve the domestic market) and so on. We do not accept speculative investment in undeveloped land, but foreign investors that meet the requirements I described will be welcome.

In 2012 total foreign direct investment (FDI) amounted to more than $14bn; but FDI in the agricultural sector was only $154m, a figure that did not even reach 1.5% of the total. Therefore, there is tremendous space for growth. It would be reasonable to expect FDI in agriculture to increase to 5% or 6% in the coming years.

In what way have recent free trade agreements (FTAs) affected the agricultural sector?

RESTREPO: The FTAs show significant potential for exports of Colombian food. At present only 5m ha are being used for agricultural purposes while our territory would allow us to multiply this figure repeatedly. The trading relationships we have strengthened by means of these treaties are with countries that have high purchasing power, such as the US, which has more than 300m inhabitants and a nominal GDP per capita of $40,000 per year. Similarly, the EU presents a large market with high export potential. The opening of these markets gives us the chance to export food products, including fruits (particularly tropical fruits), vegetables and meats. Some products are ready to venture into these markets immediately, while others, such as meat, still face some challenges – such as meeting health and hygiene standards. We cannot deny that there are significant challenges for some sub-sectors, such as rice and milk, which require support to upgrade their production processes in order to compete.

What can be done to improve the sector’s competitiveness in an increasingly global marketplace?

RESTREPO: The sector needs to develop a competitive infrastructure, which we can achieve by diverting considerable public resources to this area. The government also welcomes private investment, including foreign investment. We invite investors to participate in the development of infrastructure via public-private partnerships, which can be crucial in the development of irrigation and drainage projects, among others. Ideally, these partnerships would be executed through concessions. If we look specifically to the needs of each crop, numerous areas can be improved, including sanitation programmes, food safety initiatives, cold rooms and ultimately the entire infrastructure to ensure agriculture to be a leading sector in exports.

How is the rural housing shortage being addressed?

RESTREPO: A recent study from our National Statistics Department estimates that around 55% of Colombia’s housing deficit is located in rural areas. Before the current government came to power, the problem of rural housing was largely ignored. We, however, are committed to making housing a priority. We were initially going to build 100,000 rural households before the end of 2013. In early 2013 we increased the budget for rural housing by COP200bn ($120m), allowing us to build 120,000 homes by the end of the year. This represents a revolutionary move in rural housing issues, and responds to one of the country’s most important needs.

Expanding rural housing supply is critical to sustain the land restitution programme. This initiative, which is protected by law, is a step forward in solving the stalemate that has resulted from half a century of violence.