Pitching In

Colombia’s top businessmen and entrepreneurs decided to bet on education. With their help, the number of Colombian students who study abroad with scholarships will increase ten fold.

Last week, Luis Carlos Sarmiento Angulo, Colombian banking czar, announced he was making the rounds, visiting his colleagues, to recollect funds for the Foundation for Colombian Future (Colfuturo), an entity that has financed Colombian students who seek to pursue masters or doctoral programs abroad for more than 18 years.

As president of Colfuturo’s board of directors, Sarmiento set his goal at 30 million dollars, a very reachable sum, apparently, because in just a couple of days he had collected 20 million dollars. Some of the first entrepreneurs to sign up were Julio Mario Santo Domingo, Colombia’s richest man, Carlos Ardila Lulle, owner of Postobon, an important beverage company, and Eduardo Pacheco, owner of the Colpatria financial group. Some enterprises that also decided to help were Bavaria, Colombia’s biggest brewery, Alqueria, a milk company, and Harinera del Valle, a wheat and flour conglomerate.

Sarmiento used valid reasons to convince the country’s richest men. A study by McKinsey and Company designed to compare Colfuturo with similar programs in other countries, concluded the program had very little impact. On average, the program’s beneficiaries were only 100 a year from 1992 to 2006. Compared to Chile, where similar programs aid more than 6000 students, the number is low. Yet, Sarmiento had an even better reason to invite entrepreneurs to join his cause. Many studies have shown that countries that adopt policies that favor knowledge transfer and the adoption of external technologies have improved their development and the economic well being of their population substantially.

A recent paper by the World Bank that analyzed the causes for economic growth in 13 countries that have maintained a 7% growth rate or higher during 25 years revealed some shared characteristics. One of them has to do with education, training and the transference of technology.

India, China, Malasia, South Korea, Ireland, Singapore and Spain are just some examples. Years ago these countries decided to bet on models based on the international education of the professional class. Like Sarmiento argues, education is fundamental for development, for the creation of new jobs and the modernization of a country’s economy. In his own words, “These professionals, with masters and doctoral degrees from the best universities in the world, will come back to Colombia to work and teach.”

But to improve Colfuturo’s capacity to finance aspiring professionals, it is necessary to double Colfuturo’s funds, which stand today at 30 million dollars. With 60 million dollars it would be able to grant 1.000 credits a year, more than ten times what it does today. If the beneficiaries return to Colombia after achieving their degrees, Colfuturo condones half of the loan. If they don’t, they must pay in full. Colfuturo, until now, has granted loans-scholarships to 3.194 professionals.

The government will also help. Through Colciencias, a research program, the state will assume a part of the loan when the professionals return to Colombia.

If this new gamble proves successful, Colombia will have 10.000 new professionals with titles from international universities. This could start to change the development perspectives of the country.

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