THE LEGATUM PROSPERITY INDEX™ 2016

Bringing Prosperity to Life

Colombia

Ranked 72nd of 149

At a glance

Ranks

72 nd on the Legatum
Prosperity Index™

76th
28th
89th
79th
65th
142nd
44th
64th
52nd

SUB-INDEX RANKINGS

In the Prosperity Sub-Index rankings, Colombia performs best on Business Environment and Personal Freedom and scores lowest on the Safety & Security sub-index.

Visit our Rankings table to see how Colombia compares to other countries.

Prosperity Gap

The ‘Prosperity Gap’ takes a country's GDP and uses it as the yardstick to measure a nation's expected Prosperity Index ranking.

Colombia continues to carry a small prosperity deficit, and it is one that has grown over the past decade. Growing surplus in Business Environment and a shrinking deficit in Safety & Security and Economic Quality have been offset by the eradication of Colombia’s Social Capital surplus and a widening Governance deficit.

Note:
In the chart above, each dot represents a country. The curve shows the general tendency with which prosperity increases as GDP per capita increases. If a country falls below the curve, then we can say that compared to all other countries, it is under-delivering prosperity for its citizens. Likewise, if a country rises above the curve, then we can say that it is over-delivering prosperity for its citizens. Learn more about the Prosperity Gap here.

Alternatively, have a look at the Prosperity Gap view on our Rankings table for a full list of countries and to see how each of them are performing on the various sub-indices.

Commentary

Colombia sits mid-table in the Prosperity Index. As such it is difficult to judge its performance. Is it the best of the weaker countries in Latin America, or should it be held to the standards of the more prosperous nations on account of its strong economy, high population and moderate HDI.

Take the example of Safety & Security, where Colombia has consistently ranked the worst in Latin America and 142nd globally. This is up five places from 2007, and indeed will likely rise further if peace can be sustained, but for a relatively democratic nation, being one of the ten least safe countries in the world is poor. Colombia has had a tumultuous history battling drug cartels and other non-state actors that look to dismantle the state, but little has been done to prevent either its origins or alleviate its consequences. For example, unemployment has only fallen 1% in nearly a decade, confidence in government has fallen 20% in the same amount of time and Colombia’s score on the Corruption Perception Index has dropped by one point (lower = worse), whilst most countries have risen in these rankings.

Colombia’s Safety & Security Score as a percentage of Central and Latin America’s average Safety & Security Score.
While Colombia has improved its Safety & Security over the past decade, it remains significantly below the regional average.

Social Capital too is another aspect that brings cause for concern; slumping to 64th place in this sub-index from 37th in 2007. With a reduction across almost all variables, including trust, links to leaders, and altruistic behaviour. All contribute to a society less able to mitigate the negative prosperity effects of problems elsewhere. Here then, it would seem that Colombia is best considered among the best of the weaker group of Latin American countries.

However, it must be recognised that a lacklustre performance in dealing with certain sub-indices does not mean that certain aspects of Colombia’s performances in the Prosperity Index cannot be praised. Whilst Social Capital and Safety & Security have taken a hit, interestingly Personal Freedoms have improved, with Colombia jumping moderately from 50th to 44th, with an increase in LGBT rights and modest increases in tolerance levels.

Additionally, the economy has improved over the past decade. Rising to 76th in Economic Quality and 28th in Business Environment, Colombia is proving that it is willing to continue to compete regionally in an economic sense with its neighbours. Increases in female labour force participation, significant reductions in the poverty rate, both at the national and absolute poverty lines, as well as a huge slash in redundancy costs (Colombia was in the bottom half globally until 2012 when it dramatically edged into the top 20% in one year). Additional positives such as a vast increase in the ease of attaining credit and starting a business have somewhat dwarfed the economic negatives of a reduction in the affordability of financial services. Here then, Colombia seems better compared with the performance of Latin America’s most prosperous areas.

Whether Colombia proves itself able to compete on prosperity with Latin America’s more successful nations remains to be seen. Little change in rank over the past decade shows a country stuck in its mid-table position. If it is to climb higher, then Safety & Security must be improved, alongside weak governance.


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Data

How to read this graph:
When comparing multiple countries on a spider chart, data points that appear
further away from the center represent a better performance to the points that are closer to the center.