Growth rates of fixed and mobile broadband subscriptions in Colombia have been among the highest in OECD and LAC countries since the early 2010s. Yet, Colombia has the lowest fixed and mobile penetration rates in the OECD. The share of fibre connections and the average broadband speed are lower than the OECD average while the prices for both fixed and mobile telecommunications tend to be higher.

To improve connectivity and foster competition, the Colombian government should:

• auction the spectrum in the 700 megahertz band as soon as possible. The auction should be designed as to pursue the two key policy objectives of coverage and competition simultaneously

• review import duties on handsets and lower the tax burden on telecommunication operators

• preserve the independence of the new “converged regulator” – for the telecommunication and broadcasting sectors – by preventing any undue pressure from the government, ensuring the financial autonomy of the regulator, and setting transparent and merit-based mechanisms for the appointment of its board.

Despite persistent differences in Internet use, there is evidence that information and communication technology (ICT) policies have been successful in reducing the digital divide in Colombia. Further actions are necessary to foster effective use of digital technologies among individuals, firms and the government:

• better target public funding for digital puntos and kioscos, i.e. Internet centres in poor and remote communities, on areas where ICT use is likely to remain limited or too costly

• secure new sources of funding for the Computers to Educate (Computadores para Educar) programme while improving targeting and co-ordination with general education policies

• promote greater use of e-banking, by exempting electronic payments from the tax on financial transfers (4 por mil or 4 x 1 000)

• improve consumers’ trust in online retailers, by establishing a special department of the public prosecutor’s office for cybercrime and a dedicated website for complaints related to online transactions

• increase the effectiveness of many small-scale programmes to promote the use of ICTs among firms, for example by pooling funds into a single agency

• facilitate access to loans at a preferential rate for ICT investments by micro, small and medium-sized enterprises, which account for 80% of employment in Colombia

• involve government institutions in further developments of Digital Government (Gobierno Digital) policy

• facilitate data sharing as well as own data access and control by citizens in the context of the Open Data (Datos Abiertos) initiative

• develop a centralised approach to ICT procurement to provide public institutions with shared ICT resources, e.g. cloud computing.

Colombia has introduced policies to promote a range of ICT companies with various levels of sophistication and to facilitate the adoption of their innovations. However, available supports to firms are complex and scattered among many programmes with overlapping aims. In order to boost their effectiveness, the government should:

• ensure greater stability of funds for the newly created Ministry of Science, Technology and Innovation

• strengthen local governments’ capability and develop appropriate mechanisms to ensure that available funds for innovation are effectively spent

• develop an integrated view of innovation and promote a greater role for businesses

• strengthen the links between research and firms, in particular around the centres of excellence on big data (CAOBA) and the Internet of Things (CEA on IoT)

• assess and streamline programmes to support entrepreneurs and start-ups, e.g. Fondo Emprender, iNNPulsa, Colombia Bring IT On and App.co.

Colombia is making progress in adapting its educational system and labour market for the digital transformation, though significant challenges remain. Further actions are necessary to address these challenges:

• increase investments throughout the formal education cycle

• develop lifelong learning for all working-age individuals, independently from their employment status

• ensure sufficient availability of ICT specialists, in particular by further developing the ICT Certificate (Bachillerato TIC)

• extend the accreditation system to all higher education institutions and courses, based on a larger set of quality indicators

• provide more timely information on the labour market outcomes of graduates through the Labour Observatory for Education (Observatorio Laboral para la Educación)

• streamline regulations on online job platforms to provide platforms and workers with incentives to share data with tax and labour authorities, thus reducing informality

• continue using digital technologies and big data analytics to improve job matching, simplify businesses’ and workers’ registration, enforce tax collection, and reduce evasion.

Digitalisation in services is creating new opportunities for Colombia to boost productivity and foster diversification of production. Several legislative initiatives have been put forward and should be pursed further:

• develop a more favourable regulatory environment for professional services as well as for the financial sector, including crowdfunding legislation and Fintech

• foster the use of digital technologies to promote trade in goods and services for which Colombia has a comparative advantage, including agriculture and mining

• reduce trade costs arising from non-tariff barriers, in particular by speeding up border procedures through the use of digital tools

• enhance interoperability of national contract rules and personal data protection for cross-border transactions and data transfers.

Clearer long-term priorities, a stronger focus on larger scale programmes and better integration with other policies seem necessary to increase the effectiveness of digitalisation policies in Colombia. To achieve a whole-of-the-government approach, the government should:

• develop a National Digital Strategy through a multi-stakeholder process, followed by a public consultation

• finance digitalisation policies out of the general government revenue

• align the objectives of the Information Technologies and Communications Fund (Fondo para las Tecnologías de Información y las Comunicaciones [FONTIC]) with those set by the ICT Law (2009), i.e. “facilitate universal access and universal service”

• assess whether the FONTIC approach – a tax on the revenues of telecommunication operators and Internet service providers to finance public policies – is the most effective to achieve universal access and service

• strengthen the role of the Intersectoral Commission for the Development of the Digital Economy as the body that co-ordinates and monitors the implementation of the National Digital Strategy, under the chairmanship of the Presidential Advisor for Innovation and Digital Transformation.