Colombia Defence and Security Report Q4 2009

Although Colombia's security has improved with the decline of the the Fuerzas Armadas Revolucionarias de Colombia (FARC), the security outlook remains cloudy. Relations with Venezuela are a particular source of concern. On July 28 Venezuela's President Hugo Ch??vez recalled his ambassador and froze diplomatic relations with Colombia to protest the claim by Bogota that anti-tank launchers seized from the FARC guerilla camp came from Venezuela.

Ch??vez accused Colombia's President ??lvaro Uribe of acting irresponsibly and threatened to expropriate Colombian businesses in Venezuela and sever trade links, arguing that Colombia's imports are not essential. For now the border remains open and trade continues as the government reviews its economic, political and commercial ties with Colombia. However, Colombia's plan to increase the US military presence within its borders has drawn an explosive reaction from Ch??vez, whose rhetoric towards Colombia has become increasingly fierce.

US assistance has allowed Colombia to become a major importer of weapons systems in recent years.

Although the bulk of the US aid has been given on the condition that it is not used for counter-insurgency, but rather for anti-narcotics operations, the distinction is often blurred, as the FARC and other guerrilla groups have joined up with the narcotic-traffickers to gain essential financing. Arms are entering Colombia from all directions, with FARC purchasing weapons from Eastern Europe, Ukraine in particular. Elements within Nicaragua, Panama, Syria and Russia have also supplied them with manportable air-defence systems (MANPADS).

For Q409, BMI has updated the methodology of its Terrorism Rating and expanded it to cover 170 global cities, as well as 130 states. As before, the Terrorism Rating incorporates our analysts' qualitative view of the terrorist threat. However, it also incorporates secondary analysis of data on global terrorist incidents obtained from the US State Department's Worldwide Incidents Tracking System, to provide a quantitative assessment of the risks.

On the economic front, Colombian real GDP growth surprised with a better than expected negative 0.6% reading in Q109 and recent economic data suggests Colombia's economy is weathering the downturn better than we had expected, encouraging us to revise up our 2009 real GDP growth forecast to negative 0.4%, from -1.4% previously; thanks in part to the Colombian consumer who is proving to be more resilient in the current downturn than predicted.