BTN News: In June 2024, Colombia’s economic landscape displayed a contrasting performance between its manufacturing and commerce sectors, as reported by the National Administrative Department of Statistics (DANE). The manufacturing industry continued its downward trajectory, marking more than 15 consecutive months of decline in key metrics like production and sales. On the other hand, the retail sector saw a modest recovery, though the overall picture remains mixed with both gains and losses across various categories. These insights come ahead of the anticipated release of economic data for the second quarter and first half of 2024, shedding light on the ongoing challenges and resilience within different sectors of the Colombian economy.
The manufacturing sector’s ongoing struggles were evident, with real production dropping by 4.8% in June 2024. This downturn in production was accompanied by a 4.4% decline in real sales, and a 1.2% decrease in the workforce, indicating a pervasive slowdown in industrial activities. Notably, 30 out of the 39 industrial activities surveyed recorded negative growth in production, collectively pulling down the overall annual variation by 5.7 percentage points. Among the hardest-hit subsectors were the manufacturing of motor vehicles and their engines, which plummeted by a staggering 63.9% annually, alongside significant declines in the production of parts, pieces, and accessories for vehicles, as well as in leather tanning and the fabrication of vehicle bodies and trailers, which saw annual decreases of 35.1%, 24.3%, and 23.5%, respectively.
The slight uptick in the retail sector offers a glimmer of hope amid these challenging times. In June 2024, retail sales managed to grow by 1.5%, a welcome shift after enduring several months of declines. However, this improvement was not enough to offset the losses incurred earlier in the year, with year-to-date sales still down by 2.2% and a 5.2% decrease over the last 12 months. The positive performance in retail was driven by 11 merchandise lines that registered annual increases in real sales, counterbalanced by eight lines that continued to experience declines.
Among the retail categories that contributed positively, the sales of other motor vehicles and motorcycles stood out, with a 14.1% increase in June, contributing 1.5 percentage points to the overall variation in retail sales. Similarly, sales of computer and telecommunications equipment for personal or domestic use saw a 13.3% rise, adding 0.9 percentage points, while audio and video equipment sales surged by 27.6%, contributing an additional 0.5 percentage points. Together, these categories added 1.9 percentage points to the total retail sales variation.
Conversely, the retail sector’s growth was hampered by significant declines in the sales of fuel for motor vehicles, parts, accessories, lubricants, and clothing and textiles. These categories each contributed negatively by 0.6 percentage points, collectively dragging down the total retail sales variation by 1.8 percentage points.
As Colombia navigates through the economic challenges of 2024, the contrasting fortunes of its manufacturing and retail sectors highlight the complex dynamics at play. The continued slump in manufacturing underscores the need for targeted interventions to revive industrial production, while the mixed performance in retail suggests cautious optimism as certain categories show signs of resilience. The forthcoming economic data for the second quarter and first half of the year will provide further insights into the overall health and trajectory of the Colombian economy, as it contends with both persistent challenges and emerging opportunities.
