Colombia Background:
Colombia was one of the three countries that emerged from the collapse of Gran Colombia in 1830 (the others being Ecuador and Venezuela). A 40-year insurgent campaign to overthrow the Colombian Government escalated during the 1990s, undergirded in part by funds from the drug trade. Although the violence is deadly and large swaths of the countryside are under guerrilla influence, the movement lacks the military strength or popular support necessary to overthrow the government. An anti-insurgent army of paramilitaries has grown to be several thousand strong in recent years, challenging the insurgents for control of territory and the drug trade, and also the government's ability to exert its dominion over rural areas. While Bogota steps up efforts to reassert government control throughout the country, neighboring countries worry about the violence spilling over their borders.

Colombia Economy Overview:
Colombia's economy suffers from weak domestic and foreign demand, austere government budgets, and serious internal armed conflict, but seems poised for recovery. Other economic problems facing President URIBE range from reforming the pension system to reducing high unemployment. Two of Colombia's leading exports, oil and coffee, face an uncertain future; new exploration is needed to offset declining oil production, while coffee harvests and prices are depressed. On the positive side, several international financial institutions have praised the economic reforms introduced by URIBE, which includes measures designed to reduce the public-sector deficit below 2.5% of GDP in 2004. The government's economic policy and democratic security strategy have engendered a growing sense of confidence in the economy, particularly within the business sector, and GDP growth in 2003 was among the highest in Latin America.

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