Where the Money Goes

In the nationalist point of view, foreign investors exploit local resources while stuffing huge profits in faraway pockets. It was no surprise then, when Guillermo Herrera Carrizosa, head of the Colombian government's Development Corp., early this year complained about companies taking more out of the country than they put in. He said that foreign businessmen operating in Colombia bring "little more than technique and a name," charged that instead of increasing the needed inflow of dollars, they develop their profitable enterprises by borrowing from local financial institutions.

Since the U.S. accounts for about 80% of all private foreign investment in Colombia, U.S. Ambassador Fulton Freeman decided to put the record straight. Over the next months, Freeman made a confidential survey of 90 big U.S. corporations doing business in the country. Recently, speaking before members of the Colombian-American Chamber of Commerce in Bogota, he presented the survey's findings:

> In the past five years, many of the 90 companies did not remit any dividends at all to the U.S. Of a total net income of $29,3 million since 1957, the companies sent only $8,050,000 in dividends back home.

>The companies brought into the country eight times more capital than they raised from local financial institutions. They reported investments of $149 million, with only $18 million owed to Colombian lenders.

> They created jobs for another 16,000 Colombians.

More than a source of capital, said Freeman, foreign companies "bring ideas, managerial experience and invaluable technical know-how. They bring competition--when permitted to do so--that stimulates the local entrepreneurs. They provide employment, they stimulate complementary industries, they pay taxes, and they create new exports or substitutes for imports."

This file is automatically generated by a robot program, so reader's discretion is required.