On the opening day of the Forum for Local Development—organized by the Organisation for Economic Co-operation and Development (OECD) in Barranquilla, Colombia—one of the key points of consensus was the need to rethink how investment is attracted to regional areas.
The phrase “invest in talent, not in fiscal incentives or subsidies” emerged as a recurring theme among speakers and participants. This shift in mindset aims to promote competitiveness at a time when the economy is facing capital outflows and slower-than-expected growth.
A parallel session hosted by the Organisation of American States (OAS), with support from ProBarranquilla, further reinforced this perspective. Rather than calling for increased subsidies or tax breaks, the discussion emphasized the importance of investing in local talent, improving connectivity, and structurally strengthening the business environment.
Initial conclusions from OECD Forum in Colombia emphasize talent investment
Productive investment–rather than welfare-based policies or broad tax cuts–should be the driving force behind regional economic development. This was the central message marking the start of the Forum for Local Development, organized by the OECD in Barranquilla, Colombia.
The event, bringing together political leaders, academics, and businesspeople from over 95 countries, puts forth a key discussion for emerging countries on the table: how can cycles of territorial inequality be broken without resorting to regressive public spending?
During the inaugural session, various speakers emphasized that sustainable growth in regions is not achieved through state transfers or tax exemptions, which often benefit large capital more than local communities.
“We need to change the paradigm,” stated Lamya Kaddor, Vice President of the OECD’s Regional Development Committee. “Development does not come with checks or poorly designed fiscal incentives. It comes when we invest in infrastructure, technical education, local innovation, and market access.”
Along the same lines, Lamia Kamal-Chaoui, Director of the OECD Centre for Entrepreneurship, SMEs, Regions and Cities, insisted during this session that successful strategies must place capacity development at the center, not temporary incentives.
“Access to qualified talent, physical and digital connectivity, and the quality of public services are far more important than a tax cut,” affirmed Kamal-Chaoui, who added that it’s not about attracting investment at any cost, but about building sustainable conditions for both local and foreign companies to prosper.”
A key moment for territorial development in Colombia
This message arrives at a key moment for Colombia, where many regions still compete for investment with proposals centered on fiscal incentives, without addressing underlying problems such as labor informality, lack of infrastructure, or institutional weakness. According to the OECD, these types of strategies are inefficient if not accompanied by improvements in the productive and social base of territories.
In fact, the organization warned that public policies must be adapted to the local context. While informality can exceed 80% in rural areas, in cities like Bogotá this indicator drops to less than 35%, meaning “you cannot apply the same recipe across the whole country. A territorial approach is required that recognizes the gaps and opportunities of each region.”
Kamal-Chaoui also emphasized the urgency of more effective and better-coordinated public investment, especially between different levels of government, considering that “investing more is not enough. We must invest better, prioritizing projects that align community needs with the development of local businesses.”
One of the key topics at the forum is the need for investments to have a territorial focus. It’s not just about attracting capital, but doing so with criteria that respond to the specific needs of each region.
In the words of Hiroshi Tanaka, an OECD expert on regional policies, “it’s not enough to replicate models. We must build local capacities, promote participatory governance, and ensure investments generate productive linkages.”
This implies, among other things, strengthening local governments in project formulation, improving transparency in public contracting, and ensuring economic benefits are not concentrated in a few hands.
According to data shared at the forum, for every dollar well invested in regional infrastructure, the economic return can multiply by six in terms of employment, productivity, and increased local consumption.
Barranquilla as an example of transformation and territorial development
The choice of Barranquilla as the forum’s host city is not accidental. In the last decade, this Colombian Caribbean city has been a model of how well-directed public investment can attract private capital and transform a region’s economic fabric.
The renovation of its port, the recovery of the Mallorquín Swamp, and the creation of free trade zones specialized in digital services have generated thousands of jobs and doubled the local business base.
“The Barranquilla case demonstrates that when there is a strategic vision, investments arrive,” stated María Fernanda García, Director of Colombia’s National Planning Department.
“Here, investment wasn’t attracted by offering tax discounts, but by improving infrastructure, strengthening technical education, and facilitating business formalization,” she maintained.
On this point, Vicky Osorio, Executive Director of ProBarranquilla, affirmed that “the city’s development in recent years has been comprehensive: sustainability, education, inclusion, and economy have gone hand in hand. That’s why the choice of Barranquilla as the host city for this forum is not symbolic; it’s a validation of what we have built.”
The OECD Forum for Local Development brings together over 3,400 participants from 95 countries, with an agenda focused on topics such as entrepreneurship, innovation, fair labor markets, digitalization, and the care economy. The forum’s goal is to find mechanisms to build more competitive and inclusive territories from the local level.