Economy

Cali and Valle del Cauca are the third largest economic center of Colombia being about national and international economic exchange. The City is a must from / to the south and the border with Ecuador, and is connected with the world through the seaport of Buenaventura.

Building of Banco de Occidente

The economic transformation of Cali and the Valle del Cauca during the twentieth century and its crisis of the century, and the outlook to the new century have been the subject of deep analysis of financial and academic institutions. This section is based on the analysis and recommendations of the report Cali Colombia – Toward a City Development and Strategy published by the World Bank in 2002, and the Regional Economic Situation Reports (ICER) published quarterly by the DANE.

Center tower Cali from Cali

Traditionally, Cali and the department have been space farm, the same as during the colonial times out with the mines, production shaft. In the early twentieth century the city's economy was concentrated in the production of sugar, based on an agricultural model in which large tracts of land were cultivated with minimum use of labor. As a result, few families owned vast areas of land in one of the most fertile regions of the country. This was an important factor in determining the power relations and the organization of the city through the twentieth century.

Participación (%) PIB Valle del Cauca (1990–2005) nationwide. Constant prices and current.

In the period 1910–1930 the city's economy shifted its focus from agricultural model to become a commercial node at the national level through the development of basic infrastructure such as construction of the railway to Buenaventura and the creation of the department of Valle del Cauca with Cali designated as its capital.

Although the industrial revolution and vallecaucana Cali did not begin until the third decade of the twentieth century, some companies had already begun to build the industrial development of the region, as the printing company Carvajal y Cia ( which began operations in 1904). In 1929 there is the creation of Soap Varela Hermanos, in the 1930s other industries begin to grow as large scale factories gas s and beer, the publishing and cigarettes s. With smaller companies also appear impetus textile clothing, chemicals, chocolate s, building materials, articles leather and furniture.

In the 1940 Cali had already ceased to be a single point of trade and its economy was focused on the industry. A few years before the decade began a major investment of foreign capital to the establishment of many factories and multinational example is Croydon'' in 1937, Cementos del Valle in 1939, Carton Colombia 1941, Goodyear and Colgate-Palmolive in 1941. Later came the establishment of other multinationals like General CEAT (Centelsa) in 1955, and were based pharmaceutical laboratories in the Cauca Valley between 1940 and 1960, as Tecnoquímicas and Baxter .

The flourishing industrial city attracted waves of immigration in the 1950s and 1960s. In these decades are given important partnerships between the public and private sectors, as productive sector support to programs of business administration at the University of Valle. The growth of the University training professionals and technologists, as well as infrastructure development, were crucial for the further development of industry and trade in the Valle del Cauca. This trend continued in the 1970s and early years of the next decade, public investment in infrastructure reached significant levels benefiting not only the production sector but also to the growing population, this made for Cali and Valle del Cauca models further development across the country.

In the 1980s, before the relative laxity of state drug trafficking became a common and quick to accumulate wealth. Proceeds from the drug had a strong influence on the economy of the city. The money of dubious origin soon infected many institutions and public and private companies. The money laundering generated a boom economic declined sharply in the mid-1990s when the central government declared war on drugs.

The recession economy of the late twentieth century began to take shape. In addition to the war on drugs, were added the atomization of city resources, the lack of continuity in the development plans of the next government, and the lack of human and fiscal resources needed to implement the plans mayors. All this created a climate of mistrust among the population, industry and regional government. In this environment, the policy of economic openness government Gaviria took the city poorly prepared.

In 1998, when the economic crisis became apparent, the national government could not respond to the call of the local politicians and mayors had to introduce austerity measures under pressure from the creditor is, what collapsed vallecaucano development model. Additionally, the tightening of the country's internal conflict required a tax increase aimed at national war spending, leaving less room for local governments to collect, through taxes, the money required for their plans development

In the century economic conditions in the country and the city have changed the rules. The model that handled vallecaucano becomings department until the 1980s, has been moved to the globalization of the economy, as evidenced in areas such as: capital inflows of the most important economic groups in Colombia, creating strategic alliances between entrepreneurs and multinational vallecaucanos, the concern of the companies in the region to optimize their resources and services, investment and diversification of economic groups. Faced with the loss of influence of traditional leaders in the region, the Cali Chamber of Commerce (CCC) has taken his place and served as facilitator of private sector resources focusing on civic and social programs.

Although no official figures of DANE of gross domestic product (GDP) by cities, according to estimates by the administration of Cali, in 1996 the GDP of Cali was 6,000 million, equivalent to 7% of U.S. GDP.

According to statistics DANE in 1995, the annual growth of GDP of the Valle del Cauca region was almost twice the national rate itself. For 1997, GDP increased marginally vallecaucano even 1%. In 1999 the country's economic recession was felt with a depression that made the economy were reduced showing GDP growth of 4%. Since then GDP has grown Valley ups and downs, but its percentage share nationwide has been falling since 1995 as shown in the graph

The department contributes significantly to the national economy. According to statistics for the year 2005 as agricultural Valley contributes 5.37% of the national production, which is relatively low compared with Antioquia (15.48%) or Cundinamarca (12.81%). In fisheries products, the region ranks first vallecaucana contributing 36% of the country's total production. As for the mining, the Valley is not metal region, however in terms of non-metallic minerals department contributes 8.15% of the value added across Colombia.

The industry vallecaucana contributes 13.81% of the national value added, second only to Bogotá with a 25.39% and 18.20% with Antioquia. Particularly, the industries of food, beverages and snuff, are important items of the Valley's economy contributing 16% of national value added, equaled by only surpassed by Antioquia and Bogotá. On trade, nationally Bogotá has a 32.22%, 13.25% Antioquia and Valle 11.34%. In the Valley transportation services has 12.52% of value added.

The Consumer Price Index (IPC) of Cali has been since the last decade one of the lowest among Colombian cities. About 78% of Cali are of working age (over 18 years). In 2005 for the first time in six years the city presented an occupancy rate above 60%, which confirms the good state of the economy, led primarily by growth in manufacturing, agriculture and trade among others.