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As recently as 2004, the narcotics trade fueled violence and instability in Colombia, obstructing business and deterring foreign investment. President Alvaro Uribe's administration made remarkable strides in forcing the drug industry out. A new-found stability, combined with sweeping privatizations in the export sector and the existence of valuable natural resources like coffee, oil, and coal, translated into GDP growth averaging over 5% per year between 2004 and 2009. A July issue of LatAm Economics Weekly, a report put out by Bank of America Merrill Lynch's global research unit, cited a sovereign credit rating upgrade to investment grade among things to watch in the second half of 2010.

Another area to focus on according to that report is development in the oil sector. IHS Global Insight thinks there might be 11 billion barrels of oil yet to be discovered in Colombia, a large number given that production in the country is already at over 700,000 barrels per day and growing. One company to watch: Gran Tierra Energy (GTE). Current production is ramping up and six new wells are soon to come online. Gran Tierra's net cash position of $267 million as of a month ago puts them in a good position for M&A activity as well.

NEXT: Vietnam

Last updated August 09 2010: 11:34 AM ET
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