Interest in Colombia as Investment Destination Picks Up

On the face of it, Colombia -- where the State Department warns one has a greater risk of being kidnapped than "any other country in the world" -- does not seem a very inviting investing prospect.

Its federal budget now includes money culled from the narcotics trade, and it has stubbornly high inflation and a civil war for which a peace can't be brokered. Not the stuff of civic pride campaigns. Nonetheless, economic progress, the successful floating of the peso and fresh infusions of aid from the U.S. and the International Monetary Fund have some agog over investing in a country best known for its coca leaves and guerrillas.

"We expect that during this calendar year, Colombia will outperform the [Latin American] market," says Mohamed El-Erian, managing director at Pimco. The Pimco Emerging Markets Fund is overweight the J.P. Morgan Emerging Bond Index Plus composition of 1.4% in Colombia. (The fund doesn't give exact percentages because holdings are always changing.) ...