Colombia is becoming a gateway for Chinese companies to expand overseas into Latin America, and for exporters: think through the exit mechanism before entering | Wen Hai

Ask AI · Why should Chinese companies include exit mechanisms as a top priority when expanding overseas?

Colombia, known around the world for its coffee and fresh flowers, has become a popular destination in Latin America for Chinese companies to expand into.

Over the past 10 years, Colombia’s economy has maintained steady growth. It is now the fourth-largest economy in Latin America, after Brazil, Mexico, and Argentina. Because its scale is moderate and not as large as the top three economies, it has become a point of entry for many Chinese companies testing the Latin American market.

At the multilateral matchmaking event titled “Opportunities brought by Colombia’s sustainable development” at the first Overseas Investment and Integrated Services Expo and Fair held in Shanghai not long ago (hereinafter, the “event”), Colombia’s energy transition became a hot topic of discussion.

Colombia is currently pushing economic transformation—especially in the energy sector. In terms of electricity, the influx of many Chinese solar PV companies is changing the country’s previously single electricity structure that relied heavily on hydropower. In terms of transportation, BYD’s visibility on Colombian roads far exceeds that of Tesla, and the market share of its new energy vehicles exceeds 50%.

Bao Mingqian, head of international business process management at Jinko Technology, who has many years of experience in Colombia, told First Finance and Economics reporter that for overseas companies in the initial stage, the significance of Colombia is not only a single-project opportunity. More importantly, it can help companies build the first localized management system for the Latin American region.

Solar PV power plants

In Tolima Province (Tolima) in Colombia, which extends from the Andes mountain range, lush mountains and fast-flowing rivers are the main sights here. However, thanks to the efforts of Chinese companies, this land is now rising with a shimmering “blue ocean.”

In early March 2026, a 148-megawatt solar PV project for Escobales in Colombia, contracted by China Energy Engineering Group, achieved full-capacity grid-connected power generation. This project is currently the largest solar PV power plant built in Colombia by Chinese-funded enterprises.

In the past, Colombia relied mainly on hydropower, accounting for about 70% of total electricity generation. However, hydropower’s drawback is that during the dry season it can easily lead to electricity shortages. Colombia has abundant sunshine resources, and solar PV power generation can serve as an effective supplement. To that end, the Colombian government has introduced multiple policy and regulatory measures to promote the development of renewable energy, including solar energy.

At the event, Bao Mingqian said the direction of Colombia’s energy transition is fairly clear. For new energy companies, the key in the market is not short-term heat, but long-term policy guidance and the legal framework. If a country’s strategic positioning is clear in optimizing its energy mix, promoting green development, and supporting renewable energy, then it has the basic conditions for long-term investment.

She further said that no emerging market is fully mature from the start, but as long as a market’s rules become clearer, communication mechanisms become smoother, and the investment environment becomes more predictable, that is a positive signal for long-term investors.

Since Jinko Technology officially entered the overseas new energy independent power generation sector in 2015, based on more than a decade of overseas expansion experience, Bao Mingqian also reminded overseas investors that when deciding to enter a market, they must place importance on the exit mechanism. They cannot focus only on market size and installed-capacity space; they also need to consider whether there will be capital to take over in the future and whether they can exit smoothly. “Entering is easy, but exiting is difficult”—this is a problem that many companies tend to overlook.

Electric vehicles

According to the latest available February 2026 new vehicle market sales data released by Colombia, BYD ranked seventh. That month, it sold 1,142 new vehicles, achieving a year-on-year growth of 136.9%. In contrast, Tesla, also an electric vehicle maker, sold 296 vehicles that month and did not make the top ten by sales ranking.

Driven by both government incentive measures and rising consumer environmental awareness, Colombia’s demand for electric vehicles has grown rapidly. Against this backdrop, Chinese brands such as BYD, Great Wall Motor, and Chery have all seen significant increases in their sales and brand penetration in the local market.

Besides private cars, Chinese electric vehicles are the main suppliers in Colombia’s pure-electric bus market. In cities such as Bogotá, Medellín, and Cali, more than one thousand electric buses have been put into operation. Earlier this January, Colombian President Petro also stated via social media that the government will push for about 54k taxis nationwide to be gradually replaced with electric vehicles to speed up the green transition in the transportation sector.

In November 2025, Colombia’s Minister of Trade, Industry, and Tourism, Morales (Diana Marcela MORALES Rojas), said in a visit to China that promoting the development of new energy vehicles has become an important national-level strategy for Colombia. Colombia has become the only country in South America that is aggressively developing a replacement of 100% clean energy. Electric mobility is viewed as an important engine for driving the country’s economic transformation and social development.

In addition to the energy transition, in the traditional strength of infrastructure construction, Chinese companies have also achieved notable results in Colombia. For example, Bogotá Metro Line 1 is the largest single-asset transportation infrastructure PPP project invested in by Chinese companies in Latin America. As the capital’s first metro line, this elevated line uses Chinese technology and trains. It is expected that once it is completed and begins operations in 2028, it will greatly ease local traffic congestion and help realize the “metro dream” of more than 80 years.

(This article comes from First Finance and Economics)