Trump’s Colombia Tariff Threat Startled Companies Trying to Rely Less on China
Published On Jan 27, 2025, 12:46 PM
President Trump's recent threats to impose tariffs on Colombian imports could jeopardize the country's significant foreign investment momentum, particularly in nearshoring initiatives aimed at reducing reliance on China and Mexico. Since 2018, Colombia has attracted over $7.6 billion in foreign investments connected to manufacturing closer to the U.S., with American companies constituting the largest source of this investment. The move could shift investor sentiment away from Colombia, which had become an attractive alternative for manufacturing.
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The imposition of tariffs could deter further foreign investment in Colombia as businesses weigh the increased costs. This could negatively impact Colombian stocks and any ETFs focused on Latin American markets, as investor confidence wanes due to the uncertainty introduced by the new tariffs.