Colombia continues to lag behind its main Latin American peers in the recovery of investment, a persistent weakness that threatens economic growth and the country’s productive capacity.
In the second quarter of 2026, fixed investment remained 6.9% below its 2019 level, before the COVID-19 pandemic disrupted economies worldwide. Meanwhile, countries such as Peru, Brazil, Mexico, and Chile have already surpassed their pre-pandemic investment levels.
This gap is largely explained by the prolonged downturn in the construction and housing sectors, which account for approximately 43% of investment in Colombia. Their continued weakness has slowed the recovery and limited the resources allocated to new buildings, homes, infrastructure, and other assets needed to expand production.
The contrast with neighboring economies highlights the challenge Colombia faces in attracting capital and establishing a stronger foundation for sustained growth.
Construction and housing drag down investment in Colombia, still 6.9% below 2019
Fixed investment trends help measure the extent to which an economy is expanding its productive capacity. This indicator includes spending on assets such as buildings, housing, machinery, and equipment, which enable businesses and governments to produce goods and services over time.
Colombia’s failure to recover its 2019 investment level stands in contrast to the progress made elsewhere in the region. In the second quarter of 2026, investment in Peru was 31.4% above its pre-pandemic level, followed by Brazil at 21.7%, Mexico at 12.4%, and Chile at 12.1%, according to figures reported by Colombian business newspaper Portafolio.
These differences indicate that Colombia’s investment shortfall cannot be attributed solely to the pandemic’s impact on Latin America. Although economies across the region have faced uncertainty, financing difficulties, and uneven growth, several have managed to recover capital spending and surpass their previous highs. Colombia, by contrast, continues to face structural obstacles that are slowing its recovery.
The weakness is also evident when investment is compared with consumption. In Chile, Peru, and Mexico, economies allocate between US$27 and US$33 to investment for every US$100 in final consumption. In Colombia, the figure is just US$18 per US$100, below even Brazil, where it reaches US$20. The gap reflects a comparatively smaller effort to build the productive assets the economy needs to grow in the future.
Construction and housing hold back the recovery
The state of the construction and housing sectors is crucial to understanding Colombia’s investment shortfall. Together, they account for around 43% of national investment, meaning their prolonged weakness has a substantial impact on the broader economy.
Residential construction and other real estate projects have yet to regain their pre-pandemic momentum. When these activities contract or stagnate, the consequences extend beyond construction companies and homebuyers. The sector supports employment and generates demand for materials, transportation, and professional services, while new residential and commercial buildings expand the country’s stock of productive assets.
The slowdown therefore affects multiple economic activities simultaneously. Fewer projects mean weaker demand across supply chains and fewer opportunities to expand productive infrastructure. It also becomes more difficult to offset the decline through investment in other sectors, even when spending on machinery and equipment improves.
Other Latin American countries have benefited from different drivers of investment. Mexico, for example, has gained from manufacturing and logistics projects linked to the relocation of supply chains closer to the North American market, a trend known as nearshoring. In Peru and Chile, investment in machinery and equipment has played an important role in the recovery.
Colombia needs to revive construction and housing while also encouraging investment across a broader range of productive activities. A recovery concentrated in just a few sectors may not be enough to close the gap with its regional competitors.
A barrier to long-term growth
The investment shortfall has consequences that can extend well beyond the current economic cycle. Without sufficient resources devoted to productive assets, businesses may struggle to increase output, improve efficiency, and create higher-quality jobs.
Weak investment also limits the economy’s ability to respond to rising demand without generating additional inflationary pressures. This comes at a time when the government’s capacity to inject public funds is being constrained by a widening fiscal deficit and efforts to rein in spending.
It is worth noting that much of Colombia’s economic growth this year has been driven particularly by the public sector. A change in government is expected to alter that dynamic, with policy likely to become considerably more restrictive.
In this context, closing the investment gap will require a sustained recovery in construction and housing, alongside better conditions for attracting private capital and expanding investment in machinery and equipment.