The transformation of the Colombian economy

During the first half of the twentieth century, Colombia suffered great transformations in
the economic field. In the first instance, he managed to enter the international market
which allowed him to move from an agricultural economy to an economy of agricultural
exports and industry. These changes profoundly influenced our society, because
Colombia stopped being a rural country to gradually become an urban country.

Coffee and beginning of industrialization

After the Thousand Days' War and for nearly fifty years, Colombia experienced sustained
growth in coffee exports. Increasing global demand for grain and relative political stability
that the country experienced during the first decades were the causes of that coffee
became the main export product. With the increase in exports of land dedicated to
growing grain expanded, especially to the west of the country, in what we now call the
coffee. The State also benefited from the rise of the coffee economy, for because of the
taxes charged to coffee, could invest in the construction of infrastructure. Finally, traders
and grain growers received large revenues, which were invested in the foundation of
industries, which the industrialization process began.

Industrialization in Colombia
In addition to the impetus given by the coffee economy, they had to happen to other facts
that industrialization was consolidated in the country. The first was the implementation of
a series of protectionist economic measures, taken by governments, especially
conservatives, to encourage the creation of national industries. The second fact is related
to the global economic crises that occurred after the First World War and the Great
Depression of 1929. These crises resulted in a decrease in industrial production of some
products, especially those related to consumer goods (textiles, food , etc.) that forced,
governments of industrialized countries, to encourage the creation of factories to meet
domestic demand for such goods. In Colombia, the industry developed in three areas:
Bogota, Barranquilla and Antioquia; the latter being the most important. The sector that
was developed textiles, which highlights the Coltejer factories, founded in 1907,
Fabricato, created in 1920 and Tejicndor, formed in 1934. In addition to the textile
industry in Colombia factories related industries were created beer, food, cement and
phosphors.

Oil
During the first half of the twentieth century, oil exploitation in Colombia was also
developed. This activity, unlike coffee cultivation and manufacturing, was always in the
hands of investors and foreign companies, to the creation of the Colombian oil company

Ecopetrol in 1951. The history of oil exploration in Colombia dates back to the first decade
of the twentieth century when President Rafael Reyes gave him concession to Roberto
de Mares, the oilfield of Barrancabermeja and Virgilio Barco, the Catatumbo jungle. These
two Colombians, as they did not have enough to start operating capital decided to deliver
concessions to US companies. After intense discussions, the government approved this
business and handed to the Tropical Oil Company, granting Seas and the Colombian
Petroleum, the Barco concession. The terms of these two contracts were unfavorable for
the country because, on the one hand, the areas of oil exploitation were practically under
the control of foreign companies, and on the other, the Colombian State only received
between 7 and 14% of the earnings. The only point that fewer disadvantages posed to
Colombia was that these concessions had to be returned to the country within thirty or so
years. So in 1948 the Colombian government created Ecopetrol in order to take over the
concessions returned by foreign companies. Tropical Oil was the first to return the oilfields
of Barrancabermeja. Since that time, shares Ecopetrol oil exploration with foreign
companies.

Bananas
Another economic activity which was exclusively with foreign capital investment was
growing bananas. This began in the early twentieth century and in the early twenties and
represented 6% of total exports of the country, but much of the income remained in the
hands of the United Fruit Company, American company responsible for marketing fruits
produced in tropical areas of the world. This company established operations in the region
Cinaga, a place located on the Atlantic coast, near Santa Marta. The United Fruit never
owned the land where bananas are produced, instead, buy the production from local
producers. Still, like what happened with the oil industry, this company became practically
the administrator of the region.