08 de May 2018
Bogota in the race to win over big companies.
For sectors such as pharmaceuticals and life sciences, the city is the logistic hub of Latin America.
In the last decade, growth in Bogota has allowed the city to enter into direct competition with the main capitals of the region, such as Mexico City, Santiago de Chile or Sao Paulo, to host the operation centers of important multinationals. This is a demanding and difficult race in which the prize is worth it.
Since 2006 the capital has received around 900 investment and reinvestment projects for an estimated 19.7 billion dollars, which led to the creation of 115,000 new jobs. According to international rankings, Bogota is among the five most attractive investment locations in Latin America.
Among the companies that have opted for Bogota are Dentix, a Spanish dental care company; Nerium, a US company that has opened a cosmetics production plant; and Japanese company Castem, specialists in high precision equipment who installed their first factory outside of Asia here in Bogota. Other companies include TOTVS, leader in business solutions, which established its operations center for the Andean region in Bogota, and pharmaceutical giants such as Cipla and MSN Labs, both from India.
The finish line is the moment in which companies begin their operations in the city. However, the decision-making processes can take years during which time there are generally several cities trying to tip the scales in their favor with multiple arguments. It is a marathon race in which resistance and resilience are indispensable.
An agency like Invest in Bogota acts as an ambassador for the city and provides support to businesses and present benefits offered by the capital. These benefits focus on the company’s business by trying to tip the scales in our favor and demonstrate why Bogota is the best investment alternative.
With this advice, companies make their decisions based on the advantages offered by Bogota according to their business model. These benefits include tax incentives in duty-free zones; a high level of connectivity due to a strategic geographic location and a specialized and qualified labor force. Moreover, Bogota has the largest cargo airport in the region and third largest in terms of passengers, making the city an export platform. It is also the financial center of the country, to mention only some of the city’s key advantages.
In addition, for some strategically identified sectors, Bogota offers excellent opportunities. In the case of pharmaceuticals and life sciences, for example, the city is a logistics hub in Latin America. It is a fundamental link in the supply chain promoted by the duty-free program and has a wide market with a high demand for medicines. The prize for Bogota with MSN Labs, Cipla and various other pharmaceuticals that have arrived in the last decade has been an investment of 374 million dollars and 1,800 jobs, the majority for highly qualified personnel.
The same occurs with highly competitive sectors in Latin America such as infrastructure, creative industries, light manufacturing and technology-based services. In these cases, foreign companies see Bogota as a destination ripe for the expansion of their operations to this region.
This race is not exclusive to Latin America. It also happens in Europe and the United States and even in a fiercer way. One of the most heard of cases recently is that of e-commerce giant Amazon who made a public call for North American cities to put themselves forward to host the company’s second global operations center.
Over 230 cities demonstrated interest in participating. This list has currently reduced to 20. We see large cities the size of Atlanta, Boston, New York and LA, and those not so large such as Indianapolis, Miami, Austin and Nashville, competing to demonstrate their qualities in infrastructure, transport, connectivity, available services and qualified human capital. Some offers include tax benefits.
What is the prize for cities that make such efforts? Amazon will invest five billion dollars in its second headquarters and make a millionaire investment in the community. It will also create 50,000 direct new jobs and hundreds of thousands of indirect jobs. This “new city” that will be created thanks to the Amazon headquarters will boost economic growth by generating demand for local businesses. Moreover, Amazon will bring its experience and specialized knowledge, place the city as a key destination in productive chains and incentivize investment from other businesses. These are obvious effects of the presence of the third most innovative company in the United States according to Forbes Magazine.
Igor Galo, director of communications for Ibero-America for IE Business and technical director of XI Spanish Investment Report in Ibero-America, has stated that nowadays it is more important for a city to host the operation centers of large companies than to host the Olympic Games. The race does not run on the athletics track but in the business field.
Traditionally, cities have fought to host the Olympic Games because beyond sporting events they have been strong catalysts for economic development. However, for cities nowadays it can be a better credential or indicator of progress to host the headquarters of companies such as Apple, Microsoft, Johnson and Johnson or Amazon than to receive sporting competitions. In many cases, the turnover of these business giants exceeds the economies of many countries, including Colombia.
How good it is for Bogota, a city with enormous potential, to keep winning races to win over big companies and that the names of companies included in the Forbes List operate from the capital of Colombia for the rest of Latin America. Their logos on our buildings finish sealing the good reputation that we have earned, and that in many occasions is more valued abroad than by ourselves. We will continue working with this objective in mind. The race is long, and the city has shown the resistance of a professional marathon runner.
Juan Gabriel Pérez,
Executive Director of Invest in Bogota