Colombia Weighs Argentina-Style Tax Incentives to Revive Energy Investment

Colombia is examining whether to adopt a tax incentive framework modelled on Argentina's Incentive Regime for Large Investments, known as RIGI, as it looks to draw major projects into its energy and mining sectors, Deputy Energy Minister Armando Cuello said.

Speaking at an economic conference in Bogota, Cuello said the government is studying whether to replicate elements of the Argentine scheme, which offers tax, customs and foreign-exchange benefits to large-scale projects. The regime was introduced in 2024 under Argentine President Javier Milei.

"There is political will to create an environment that will bring back investment, which I know is a long-term endeavor," Cuello said.

The deputy minister's remarks come after Colombian President Abelardo De La Espriella, who took office in August, said his administration would resume signing new hydrocarbon exploration contracts and permit fracking, reversing a ban imposed under former President Gustavo Petro.

Cuello said the absence of new project development during the previous administration had driven Colombia's energy sector into crisis. He added that the country's power deficit had widened to 8.6% from 7.2% a week earlier.

He also said the government was taking every possible measure to avert widespread power shortages during the El Niño weather phenomenon, which is affecting much of Latin America.