Colombian liberalization and integration to world trade markets: Much ado about nothing

The objective of this paper is to study the evolution of Colombian liberalization and integration to world trade from 1995 to 2016. We achieve our objective by measuring Colombia’s importance in the world trade network. We employ several types of network centrality metrics to measure importance (i.e. degree, strength, hub, authority), and examine their dynamics against a set of regional peers that serve as benchmark countries. Consistent with previous literature, more than two decades of dedicated trade policies and institutional changes resulted in increased exports and imports. However, when compared to regional peers such as Chile, Brazil, Mexico, and Peru, and China and the United States as trade leading countries, Colombia’s centrality in the world trade network did not improve accordingly. Absolute changes in the evolution of trade did not materialize in an enhanced integration to world markets. Colombia’s ranking in the world trade network did not improve materially, whereas that of some of her regional peers did manifestly (i.e. Peru and Chile). Results highlight the perils of analyzing a country’s trade dynamics in isolation, and emphasizes the usefulness of examining the world trade network. From the economic policy and institutional perspectives, results underscore the challenges ahead to better integrate to world markets and to achieve long-term economic growth from trade.