Mr Javier Villareal, Main Advisor for Royalties Affairs, National Planning Department of Colombia during the Second Meeting of the Policy Dialogue on Natural Resource-based Development, held on 3-4 June 2014 at OECD Headquarters in Paris.

1. National
Planning
Department
www.dnp.gov.co

2. Colombian General Royalties System
Opportunities and Challenges Behind the Reform
Javier Antonio Villarreal
Paris. June 3rd, 2014
School- Tumaco

3. Colombia is the 3rd economy in Latin America
 Decentralized country
 32 departments, 1.102
municipalities, 13 Metropolitan
areas
 Between 2009 and 2013 GDP
average growth was 4,1%
 Nevertheless regional GDP
disparities need policies to
reduce inequity.
 While Bogota’s participation in
national GDP is 24%, Vichada’s
participation is 1%.

4. Source: SGR and DNP, 2013
Increasing gaps
17 % of population had
80% of resources
Funds were focused on 8
departments
Earmarked use: health,
education, water and
sanitation
Before 2011 After 2011
100% of population allocated
with resources
Savings and investment funds
Serves all departments
10% of Royalties go to Science,
Technology and Innovation Fund
(U$ 484 million per year)
Non earmarked use of funds
Colombia’s Royalties System
A Territorial Inclusive Policy for Development

5. SGR is System that democratizes the use of
royalties
Equity
• Wealth that arises from natural resources belongs to all Colombians
Regional impact
• The system created regions, aiming to provide incentives for regional
impact project design and implementation, in order to promote
development and competitiveness in the country
Transparency and more efficient use of resources
• More coordination between national and local governments, and within
regions
• Improve public investment planning and resource execution
Savings
• For periods when royalties income is lower
• To make public expenditure sustainable
• To honor obligations on pensions at the regional level
1
2
3
4

6. Funds Within the SGR
SGR
1,3% SGR Operation
0,7% Monitoring, control
and evaluation system of
royalties
0,5% Special condition’s
municipalities
2% Oil fields oversight and
mapping
10
%
20
%
10
%
34,
5%
6,6
%
9,9%
16,5%
9%60%
10 %
20%
10%
6,6 %

7. MUNICIPAL
OCAD
TS
Defines the project to be funded by SGR
Assess, evaluates, prioritises and approves
investment projects submitted by
governments (depending on whether it´s
National, Departmental, Municipal or ST&I)
Decides the execution of the projects
If a project is rejected by the OCAD the
Entity (National, Municipal, Departmental,
ST&I) does not lose the royalty funds, but is
able to design a new one.
DEPARTMENTALREGIONAL SCIENCE TECHNOLOGY &
INNOVATION
Multilevel Governance Within SGR:
OCAD
*TS: Technical Secretariat - *OCAD: Spanish acronyms for a Collegiate Board for Administration and Decision

8. Ongoing
Projects
2640
Completed
Projects
774
Capacity-building resources 2013
($US thousands)
$ 106
$ 66
$ 66
$ 26
$ 23
$ 21
$ 18
$ 15
$ 12
$ - $ 50 $ 100 $ 150
ST OCAD regionales
Departamentos
Corporaciones autónomas
Municipios cat. 6
Municipios cat. 5
Municipios cat. 4
Municipios cat. 3
Municipios cat. 2
Municipios cat. 1
More than $353K US have been allocated to sub-national
governments’ capacity building strategy
% projects approved in
OCAD
Direct. Tranf
[PORCENTA
JE]
Esp.
RCF
40%
RCF
[PORCENTA
JE]
RDF
[PORCENT
AJE]
ST&I
[PORCENT
AJE]
Municipalities Cat.1
Municipalities Cat. 2
Municipalities Cat. 3
Municipalities Cat. 4
Municipalities Cat. 5
Municipalities Cat.6
CAR
Departments
Regions
Municipalities and departments have
strengthened their planning capacity

9. Transport
$1.8 US Billion
1.594 projects
The SGR invests in different sectors
Science, Technology
and Innovation
$0.8 US Billion
204 projects
Education
$0.8 US Billion
568 projects
Environment
$0.2 US Billion
180 projects
Housing
$0.7 US Billion
716 projects
Health
$0.2 US Billion
206 projects
Agriculture
$0.4 US Billion
638 projects

10. Data report
and follow up
online
SUIFP
Monitoring
system
GESPROY
Citizen’s
follow up
tools
MapaRegalías
www.maparegalias.sgr.gov.co
www.sgr.gov.co
Reports for
national,
departmental
and municipal
scale
$29US
million Transparency tools are the core of the System

11. Challenges
1. Closing territorial gaps
2. Institutional strengthening
3. Multilevel governance through OCAD
4. ST&I for competitiveness
5. From a project based system to a
programme-based system
6. Transparency as a cross cutting
strategy to the system
 All departments have access to
royalties funds
 Specialized teams working hand in
hand with departments and
municipalities to develop projects:
capacity building
 ST&I fund counting on the
participation of academia and private
sector
 5 multiregional projects
 Surveillance, follow up and
accountability systems
How is Colombia facing these
challenges?
The SGR is addressing key challenges
in Colombia

12. javillarreal@dnp.gov.co
Tel. (+57 1) 3815000
Cra 10 N°10 – 55 Piso 19
Bogotá - Colombia
Javier Villarreal Villaquirán
www.dnp.gov.co
Thank you