Cali
Economic history

The economic transformation of Cali and the Valle del Cauca during the twentieth century and its crisis of the century, and the outlook to the new century have been the subject of deep analysis of financial and academic institutions. This section is based on the analysis and recommendations of the report Cali Colombia – Toward a City Development and Strategy published by the World Bank in 2002, and the Regional Economic Situation Reports (ICER) published quarterly by the DANE.

In the early twentieth century the city's economy was concentrated in the production of sugar, based on an agricultural model in which large tracts of land were cultivated with minimum use of labor. As a result, a few families owned vast areas of land in one of the most fertile regions of the country. This was an important factor in determining the power relations and the organization of the city through the twentieth century.

In the period 1910–1930, the city's economy shifted its focus from an agricultural model to become a commercial node at the national level through the development of basic infrastructure such as construction of the railway to Buenaventura and the creation of the department of Valle del Cauca with Cali designated as its capital.

Although the industrial vallecaucana revolution of Cali did not begin until the third decade of the twentieth century, some companies had already begun to build the industrial development of the region, as the printing company Carvajal y Cia (which began operations in 1904). In 1929 there is the creation of Soap Varela Hermanos, in the 1930s other industries begin to grow as large scale factories of gas and beer, printing and cigarettes. Smaller companies also appeared focusing on textile clothing, chemicals, chocolates, building materials, leather articles and furniture.

In 1940, Cali had already ceased to be a single point of trade and its economy was focused on industry. A few years before the decade began a major investment of foreign capital led to the establishment of many factories and local business grew to multinational corporations; as Croydon in 1937, Cementos del Valle in 1939, and Carton Colombia in 1941; Goodyear and Colgate-Palmolive came from the US in 1941. Later came other corporations like General CEAT (Centelsa) in 1955, and pharmaceutical laboratories were based in the Cauca Valley between 1940 and 1960, as Tecnoquímicas and Baxter.

The flourishing industrial city attracted waves of immigration in the 1950s and 1960s. In these decades there were important partnerships between the public and private sectors, as productive sector support to programs of business administration at the University of Valle. The growth of the university training professionals and technologists, as well as infrastructure development, were crucial for the further development of industry and trade in the Valle del Cauca. This trend continued in the 1970s and early years of the next decade. Public investment in infrastructure reached significant levels benefiting not only the production sector but also the growing population, this made Cali and Valle del Cauca models further development across the country.

In 1998, when the economic crisis became apparent, the national government could not respond to the call of the local politicians and mayors had to introduce austerity measures under pressure from creditors, which caused the vallecaucano development model to collapse. Additionally, the tightening of the country's internal conflict required a tax increase aimed at national war spending, leaving less room for local governments to collect, through taxes, the money required for their development plans.
detectable_content:number_placeholders[6]