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Weekly Report - 3 July 2008 (ISSN 1741-7422)

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TRACKING TRENDS

COLOMBIA | Growth slows. The economy grew by 4.1% in the first quarter of 2008, compared with the same period last year, the state statistics agency, Dane, reported. This is well down on the 9.1% growth posted in the first quarter of 2007. GDP growth also fell by 0.9% compared with the final quarter of 2007. In the context of the regional slowdown GDP growth is consistent with other countries such as Venezuela which saw high single-digit growth fall to similar levels in the first quarter although there has been no let up in the pace of GDP growth in Peru. The most impressive growth was in the financial and services sector (7.5%), transport (7.4%) and mining (5.2%).
Interestingly, two-way trade between Colombia and Venezuela reached US$2.06bn in the first four months of the year, up 30.1% on the same period in 2007, according to the chamber of bilateral trade, Cavecol. This belies fears that strained relations between the two countries and periodic threats by Chávez to turn to Brazil to fulfil Venezuela's needs rather than Colombia would damage trade. Indeed, Colombian exports to Venezuela grew by 45% over this period while Venezuelan exports to Colombia fell by 9%.

BOLIVIA | USAID. Coca producers from Chapare, a province in Cochabamba, announced the expulsion of the US Agency for International Development (USAID) from the area. Municipal authorities said that while those projects underway would be completed, as of 26 June no new agreements would be signed. The government has accused USAID on various occasions of conspiring against President Evo Morales and supporting rightwing groups such as the Unión Juvenil Cruceñista. On 30 June the government announced that the US had frozen US$657m in aid from the Millennium Challenge Account.