In October 2007 Álvaro Uribe and Hugo Chávez, the Presidents of Colombia and Venezuela, inaugurated a new bi-national gas pipeline between the two countries. The 220km pipeline runs from Campo Ballesta in Colombia to the lake region of Maracaibo in Venezuela, and has 10 pumping stations. It took over a year to complete, as it began to be laid in June 2006. Although it will initially carry Colombian gas to western Venezuela, the intention is to eventually reverse the flow when Venezuela is able to link its large gas fields in the east of the country to the national grid, and open up an export route to Colombia, Ecuador, and Central America. The pipeline was due to be used to pump 150mn cubic feet per day of Colombian natural gas to Venezuela, supplied from fields operated by US company Chevron and Colombia's state-owned Ecopetrol. On current plans, Venezuela would be in a position to reverse the flow within four to seven years. In our latest Colombia Freight Transport Report, BMI concludes that pipeline throughput (both oil and gas) will grow by an annual average of 4.9% over the next five years. Various factors support this prediction. The economy will grow by an annual average of 4.7% in 2007- 2011, a little faster than the preceding five-year period (an average of 4.5%), partly as a result of rising confidence in the government's market-friendly economic policies. At the same time, however, oil and gas demand will remain strong, and there are growing opportunities for Colombia to act as a transit corridor, particularly for Venezuelan hydrocarbon exports out to the Pacific, on their way to China and other markets. Lawlessness and guerrilla insurgencies, which have targeted pipelines, will continue to be a factor, but the overall security situation is expected to improve Overall prospects for the freight sector are relatively encouraging. We are expecting freight turnover to grow by an average of 6.5% during 2008-2012, significantly ahead of the economy's general growth rate. We believe President Uribe's emphasis on restoring a strong central government based on the rule of law is gradually improving the operating environment and slowly encouraging a pick-up in investment levels. This implies a scenario in which some of Colombia's ageing transport infrastructure will gradually be modernised and upgraded and some of the country's 'no-go' rebel areas will be slowly brought back to normality with the re-establishment of transport links. We do not, however, see the country's deep-rooted problems of social and political violence coming to an early end - in that sense there are few 'quick wins' to be had. Airfreight traffic growth will average 8.4% during the 5-year forecast period, with rail traffic following in second place at 8.0%. Road freight will be in third place at 7.5%, inland waterways at 5.3%, pipeline throughput at 4.9% and maritime freight at 3.7%. Overall, Colombia scores 39.0, out of a possible maximum of 70.0, in our freight transport business environment matrix. It comes in almost exactly on the average regional score. The country scores relatively well on freight transport growth, long-term economic risk and the competitive environment. Areas of relative weakness include long-term political risk (largely a reflection of the poor security situation as a result of long-running guerrilla insurgencies)
For more information or to purchase this report, go to http://www.fastmr.com/
About Business Monitor International
Business Monitor International (BMI) offers a comprehensive range of products and services designed to help senior executives, analysts and researchers assess and better manage operating risks, and exploit business opportunities, across 175 markets.
BMI offers three main areas of expertise: Country Risk BMI's country risk and macroeconomic forecast portfolio includes weekly financial market reports, monthly regional Monitors, and in-depth quarterly Business Forecast Reports. Industry Analysis BMI covers a total of 17 industry verticals through a portfolio of services, including Daily Alerts, monthly regional Insights, and in-depth quarterly Country Forecast Reports. View more research from Business Monitor International at http://www.fastmr.com/
About Fast Market Research
Fast Market Research is an online aggregator and distributor of market research and business information. We represent the world's top research publishers and analysts and provide quick and easy access to the best competitive intelligence available.
For more information about these or related research reports, please visit our website at http://www.fastmr.com or call us at 1.800.844.8156.
