Obligation Colombia 9.85% ( XS0306322065 ) en COP

Colombia

97.42 % ▲

Colombie

XS0306322065 ( en COP )

9.85% par an ( paiement annuel )

28/06/2027

Prospectus brochure de l'obligation Colombia XS0306322065 en COP 9.85%, échéance 28/06/2027

5 000 000 COP

1 924 515 000 000 COP

28/06/2024 ( Dans 38 jours )

L'Obligation émise par Colombia ( Colombie ) , en COP, avec le code ISIN XS0306322065, paye un coupon de 9.85% par an.
Le paiement des coupons est annuel et la maturité de l'Obligation est le 28/06/2027

PROSPECTUS SUPPLEMENT
(To prospectus dated March 23, 2007)

Ps. 1,924,515,000,000
Republic of Colombia
9.85% Global TES Bonds due 2027
Payable in U.S. dollars

The bonds will mature on June 28, 2027. Colombia will pay interest on the bonds on each June 28. Interest will accrue
from June 28, 2007, and the first interest payment on the bonds initially offered on the date of this prospectus supplement
will be made on June 28, 2008. Principal and interest will be translated into and payment of principal and interest will be
made in United States dollars.
The bonds will not be redeemable before maturity and will not be entitled to the benefit of any sinking fund.
The bonds are termed "TES" bonds as a short-hand form for Títulos de Tesorería (Treasury securities).
The bonds will contain provisions regarding acceleration and future modifications to their terms that differ from those
applicable to Colombia's outstanding public external indebtedness issued prior to January 21, 2004. Under these provisions,
which are described in the sections entitled "Description of the Securities--Debt Securities--Default and Acceleration of
Maturity," "--Collective Action Securities" and "--Meetings and Amendments--Approval (Collective Action Securities)"
in the accompanying prospectus, Colombia may amend the payment provisions of the bonds with the consent of the holders
of 75% of the aggregate principal amount of the outstanding bonds.
Application has been made to list the bonds on the official list of the Luxembourg Stock Exchange and to trade them on
the Euro MTF Market of the Luxembourg Stock Exchange.
See "Risk Factors" beginning on page S-9 to read about certain risks you should consider before investing in the
bonds.

Per Bond in
Per Bond
U.S. Dollars(3)
Total

Issue Price(1)(2) ................................................................... 100.000%
U.S. $2,598.02
U.S. $999,987,010
Underwriting Discount .................................................... 0.500%
U.S. $ 12.99
U.S. $ 4,999,935
Proceeds, before expenses, to Colombia.......................... 99.500%
U.S. $2,585.03
U.S. $994,987,075

1:
Purchasers will make the payment of the issue price in U.S. dollars based on an exchange rate for the conversion of Colombian pesos into U.S. dollars of Ps. 1,
924.54 per U.S. $1.00, which is the Representative Market Rate in effect on June 12, 2007. The minimum denomination per bond is Ps. 5,000,000 and bonds will
be issued in integral multiples of Ps. 1,000,000 in excess thereof.
2:
Purchasers will also be required to pay accrued interest, if any, from June 28, 2007, the date Colombia expects to deliver the bonds offered by this prospectus
supplement.
3:
For purposes of calculating values on a per bond basis, a face value of Ps. 5,000,000 has been assumed.
Delivery of the bonds, in book-entry form only, is expected to be made on or about June 28, 2007.
Neither the Securities and Exchange Commission, referred to as the SEC, nor any other regulatory body has approved or
disapproved of these securities or passed upon the accuracy or adequacy of this prospectus supplement or the accompanying
prospectus. Any representation to the contrary is a criminal offense.
Citi
Deutsche Bank Securities

June 12, 2007

TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT

Summary.........................................................................................................................................................

S-3
The Issuer...................................................................................................................................................

S-3
The Offering...............................................................................................................................................

S-6
Risk Factors ....................................................................................................................................................

S-9
Certain Defined Terms and Conventions........................................................................................................
S-13
About this Prospectus Supplement .................................................................................................................
S-14
Incorporation by Reference ............................................................................................................................
S-14
Use of Proceeds ..............................................................................................................................................
S-16
Recent Developments .....................................................................................................................................
S-17
Republic of Colombia ................................................................................................................................
S-17
Economy ....................................................................................................................................................
S-18
Foreign Trade and Balance of Payments....................................................................................................
S-18
Monetary System .......................................................................................................................................
S-20
Public Sector Finance.................................................................................................................................
S-22
Public Sector Debt .....................................................................................................................................
S-25
Description of the Bonds ................................................................................................................................
S-28
General Terms of the Bonds ......................................................................................................................
S-28
Payment of Principal and Interest ..............................................................................................................
S-29
Default; Acceleration of Maturity..............................................................................................................
S-30
Paying Agents, Calculation Agent and Transfer Agents............................................................................
S-30
Notices .......................................................................................................................................................
S-30
Registration and Book-Entry System.........................................................................................................
S-31
Certificated Bonds .....................................................................................................................................
S-31
Taxation ..........................................................................................................................................................
S-32
Underwriting...................................................................................................................................................
S-34
General Information........................................................................................................................................
S-36
Annex A--Summary of Procedures and Time Schedule................................................................................
S-38
Annex B--Form of Irrevocable Order for Colombian Market Makers ..........................................................
S-42
Spanish Translation of Annex A and Annex B ..............................................................................................
S-46

PROSPECTUS

About this Prospectus .....................................................................................................................................

2
Forward-Looking Statements .........................................................................................................................

2
Use of Proceeds ..............................................................................................................................................

2
Description of the Securities...........................................................................................................................

3
Taxation .........................................................................................................................................................

14
Debt Record ...................................................................................................................................................
15
Plan of Distribution.........................................................................................................................................

15
Official Statements .........................................................................................................................................

16
Validity of the Securities ................................................................................................................................

16
Authorized Representative..............................................................................................................................

16
Where You Can Find More Information ........................................................................................................

17

You should rely only on the information contained in or incorporated by reference in this prospectus
supplement and the accompanying prospectus. We have not authorized anyone to provide you with different
information. We are not making an offer of these securities in any state where the offer is not permitted. You should
not assume that the information contained in this prospectus supplement or the accompanying prospectus is accurate
as of any date other than the date on the front of this prospectus supplement.

S-2

SUMMARY
This summary highlights information contained elsewhere in this prospectus supplement and the accompanying
prospectus. It is not complete and may not contain all of the information that you should consider before investing in the
bonds. You should read this entire prospectus supplement and the accompanying prospectus carefully.
The Issuer
Overview
Colombia is the fourth largest country in South America, with a territory of 441,020 square miles (1,141,748
square kilometers). Located on the northwestern corner of the South American continent, Colombia borders Panama and the
Caribbean Sea on the north, Peru and Ecuador on the south, Venezuela and Brazil on the east and the Pacific Ocean on the
west. According to the National Administrative Department of Statistics ("DANE") 2005 Census, Colombia's population was
approximately 41.2 million. Over 7.8 million people live in the metropolitan area of Bogotá, the capital of Colombia.
Colombia is governed as a Presidential Republic. Colombia is divided into 32 departments. Each department is
divided into municipalities.
Government
The Republic of Colombia is one of the oldest democracies in the Americas. In 1991, a popularly elected
Constitutional Assembly approved a new Constitution, replacing the Constitution of 1886. The Constitution provides for
three independent branches of government: an executive branch headed by the President; a legislative branch consisting of
the bicameral Congress, composed of the Chamber of Representatives and the Senate; and a judicial branch consisting of the
Corte Constitucional (Constitutional Court), the Corte Suprema de Justicia (Supreme Court of Justice, or "Supreme Court"),
the Consejo de Estado (Council of State), the Consejo Superior de la Judicatura (Supreme Judicial Council), the Fiscalía
General de la Nación (National Prosecutor General) and such lower courts as may be established by law.
Under the Constitution, the President is elected by direct vote. On May 28, 2006, Alvaro Uribe was re-elected
President for the 2006-2010 term in the first ballot with 62.2% of the votes. Carlos Gaviria, from the Alternative Democratic
Pole Party, finished second with 22.04% and Horacio Serpa, from the Liberal Party, was third with 11.84% of the votes.
President Uribe's plans for his second term in office include the following goals:
·
Economy. The Government plans to achieve a 6% annual rate of growth. To that end, the Government
plans on pursuing a stable macroeconomic policy, reforming the tax system, boosting credit supply
and attracting foreign investors as major priorities. In addition, the Government plans on increasing the
number of beneficiaries of social assistance programs.
·
Security. The Government intends to continue its efforts to reduce homicides, kidnappings and illegal
drug production, insisting on a dialogue with the illegal armed groups and strengthening the programs
of reintegration into civil society of former combatants.
·
Commercial relationships. The Government plans to promote the redirection of the Andean
Community of Nations, developing the agreements already signed with Mercosur, expanding the free
trade agreements with countries of Central America and the European Union and increasing economic
cooperation with China and Japan.
No assurance can be given that any of these goals will be achieved.
The Minister of Finance is Oscar Ivan Zuluaga, who took office in March 2007.
Judicial power is vested in the Constitutional Court, the Supreme Court, the Council of State, the Supreme Judicial
Council, the National Prosecutor General and in such lower courts as may be established by law. The function of the
Constitutional Court, whose nine members are elected by the Senate for an eight-year term, is to assure that all laws are
consistent with the Constitution and to review all decisions regarding fundamental rights. The Supreme Court is the final
appellate court for resolving civil, criminal and labor proceedings. The Council of State adjudicates all matters relating to the
exercise of public authority or actions taken by the public sector, including the review of all administrative decisions or
resolutions that are alleged to contradict the Constitution or the law. The Council of State also acts as advisor to the
S-3

Government on administrative matters. Supreme Court and Council of State justices are appointed for eight-year terms by
their predecessors from a list of candidates provided by the Supreme Judicial Council. The National Prosecutor General, who
is appointed for a four-year term by the Supreme Court from a list of three candidates submitted by the President, acts as the
nation's prosecutor. The judicial branch is independent from the executive branch with respect to judicial appointments as
well as budgetary matters.
National legislative power is vested in the Congress, which consists of a 102-member Senate and a 166-member
Chamber of Representatives. Senators and Representatives are elected by direct popular vote for terms of four years.
Senators are elected on a nonterritorial basis, while Representatives are elected on the basis of proportional, territorial
representation. In each department, legislative power is vested in departmental assemblies whose members are elected by
direct popular vote. At the municipal level, legislative power is vested in municipal councils, which preside over budgetary
and administrative matters. The most recent Congressional elections occurred on March 12, 2006. Candidates aligned with
President Uribe's administration won a majority of the seats in both the Senate and the Chamber of Representatives.

S-4

SELECTED COLOMBIAN ECONOMIC INDICATORS

2002
2003
2004
2005
2006

Domestic Economy

Real GDP Growth (percent)(1) .......................
1.9%
3.9%
4.8%
4.7%
6.8%
Gross Fixed Investment Growth (percent)(2)..
9.9
15.4
13.4
18.9
18.0
Private Consumption Growth (percent)(2)......
3.6
2.6
4.2
5.0
6.7
Public Consumption Growth (percent)(2) .......
(2.0)
(1.2)
3.3
4.3
2.1
Consumer Price Index(3) ................................
7.0
6.5
5.5
4.9
4.5
Producer Price Index(3) .................................
9.3
5.7
4.6
2.1
5.5
Interest Rate (percent)(4) ................................
8.9
7.8
7.8
7.0
6.3
Unemployment Rate (percent)(5)....................
15.7
14.7
13.0
12.2
12.8%
Balance of Payments
(millions of U.S. dollars)
Exports of Goods (FOB)(6) ............................
$11,794
$12,933
$16,442
$20,818
$23,930
Oil and its derivatives(6) ............................
3,275
3,383
4,227
5,559
6,328
Coffee(6) ....................................................
772
809
949
1,471
1,461
Imports of Goods (FOB) (6)............................
11,653
12,792
15,324
19,431
23,976
Current Account Balance(6) ...........................
(1,358)
(974)
(909)
(1,890)
(2,909)
Net Foreign Direct Investment(6) ...................
1,283
820
2,941
5,593
5,197
Net International Reserves ............................
10,841
10,916
13,536
14,947
15,436
Months of Coverage of Imports

(Goods and Services)................................
8.5
7.9
8.2
7.2
6.1
Public Finance(7)
(billions of pesos or percentage of GDP)
Non-financial Public Sector Revenue............
Ps. 86,893
Ps. 98,138
Ps. 128,912
Ps. 150,533
Ps. 169,151
Non-financial Public Sector

Expenditures(8) .........................................
93,967
105,258
129,654
151,916
170,488
Non-financial Public Sector Primary

Surplus/(Deficit)(9) ........................................
2,035
5,064
8,506
10,509
11,679
Percent of GDP(1)......................................
1.0%
2.2%
3.3%
3.7%
3.6%
Non-financial Public Sector Fiscal

Surplus/(Deficit) ...........................................
(7,747)
(6,544)
(3,586)
(954)
(3,162)
Percent of GDP(1)......................................
(3.8)%
(2.9)%
(1.4)%
(0.3)%
(1.0)%
Central Government Fiscal Surplus/

(Deficit)......................................................
(12,435)
(11,528)
(13,985)
(13,730)
(13,027)
Percent of GDP(1)......................................
(6.1)%
(5.0)%
(5.4)%
(4.8)%
(4.1)%
Public Debt (10)
Public Sector Internal Funded Debt (billions

of pesos)(11) ...................................................
Ps.83,072
Ps. 88,721
Ps. 99,354
Ps. 117,337
Ps. 124,317
Percent of GDP(1)......................................
40.8%
38.8%
38.5%
41.1%
38.8%
Public Sector External Funded Debt (millions

of dollars)(12)..............................................
$22,167
$24,173
$25,318
$23,716
$25,963
Percent of GDP(1)......................................
27.5%
29.9%
26.0%
19.8%
19.8%
_______________________
Some of the foregoing figures are updated by more recent information under "Recent Developments".
1:
GDP figures calculated using new methodology implemented by DANE in 1999.
2:
Estimated figures.
3:
Percentage change over the twelve months ended December 31 of each year.
4:
Average for each year of the short-term composite reference rate, as calculated by the Superintendencia Financiera (Financial Superintendency).
5:
Refers to the average unemployment rates in the thirteen largest cities in Colombia in December of each year.
6:
Figures for all years have been recalculated according to the recommendations contained in the fifth edition of the IMF's Balance of Payments Manual. Preliminary
figures for 2002 through 2006. Imports and exports of goods do not include "special trade operations."
7:
All figures calculated according to IMF methodology, which includes privatization, concession and securitization proceeds as part of public sector revenues.
8:
The amounts of Central Government transfers to departments and municipal governments are not eliminated in the calculation of consolidated non-financial public
sector revenue and consolidated non-financial public sector expenditures and, accordingly, the revenue and expenditure figures included above are greater than those that would
appear were such transfers eliminated upon consolidation. See "Public Sector Finance."
9:
Primary surplus/(deficit) equals total consolidated non-financial public sector surplus/(deficit) without taking into account interest payments or interest income.
10:
Figures for 2004 and 2005 are subject to revision. Exchange rates at December 31 of each year.
11:
Includes peso-denominated debt of the Government (excluding state-owned financial institutions and departmental and municipal governments) with an original
maturity of one year or more, and public sector entities' guaranteed internal debt.
12:
Includes external debt of the Government (including Banco de la República, public agencies and entities, departments and municipal governments and state-owned
financial institutions) with an original maturity of one year or more.
Sources:
Banco de la República, Ministry of Finance and Public Credit ("Ministry of Finance"), Departamento Administrativo Nacional Estadístico
("DANE") and Consejo Superior de Política Fiscal ("CONFIS").

S-5

The Offering

Issuer
The Republic of Colombia.

Aggregate Principal Amount

Ps.1,924,515,000,000.

Issue Price

100.000% of the principal amount of the bonds. The Issue Price will be
payable in U.S. dollars based on an exchange rate for the conversion of
Colombian pesos into U.S. dollars of Ps. 1, 924.54 per U.S. $1.00.

Issue Date

June 28, 2007.

Maturity Date
June 28, 2027.

Form of Securities

The bonds will be issued in the form of one or more registered global
securities without coupons, which will be deposited with a common
depositary for Euroclear and Clearstream, Luxembourg. The bonds will not be
issued in bearer form.

Denominations
The bonds will be issued in denominations of Ps. 5,000,000 and integral
multiples of Ps. 1,000,000 in excess thereof.

Interest
The bonds will bear interest from June 28, 2007 at the rate of 9.85% per year,
payable in U.S. dollars as calculated as described below. We will pay you
interest annually in arrears on June 28 of each year, commencing on June 28,
2008. Interest will be computed on the basis of the actual number of days
during the period in respect of which interest is being paid, not to exceed 365,
divided by 365.

Redemption

We may not redeem the bonds before maturity. At maturity, we will redeem
the bonds at par.

Risk Factors

Risk factors relating to the bonds:
·
The price at which the bonds will trade in the secondary
market is uncertain.
·
The bonds will contain provisions that permit Colombia to
amend the payment terms without the consent of all holders.
Risk factors relating to foreign currency securities:
·
If the Colombian peso depreciates against the U.S. dollar, the
effective yield on the bonds will decrease below the interest
rate on the bonds, and the amount payable at maturity may be
less than your investment, resulting in a loss to you.
·
Government policy or actions could adversely affect the
exchange rate between the peso and the U.S. dollar and an
investment in the bonds.
·
Exchange controls could affect the peso/U.S. dollar exchange
rate and the amount payable on the bonds.
Risk factors relating to Colombia:
·
Colombia is a foreign sovereign state and accordingly it may
be difficult to obtain or enforce judgments against it.

·
Certain economic risks are inherent in any investment in an
emerging market country such as Colombia.
S-6

·
An increase in Colombia's debt-to-GDP ratio could increase
the burden of servicing Colombia's debt.
·
Colombia's economy remains vulnerable to external shocks
that could be caused by significant economic difficulties of its
major regional trading partners or by more general
"contagion" effects, which could have a material adverse
effect on Colombia's economic growth and its ability to
service its public debt.
·
Colombia's credit ratings may be changed, suspended or
withdrawn.
Risk Factors Relating to the Auction Procedures:
·
Potential investors should not expect to sell the bonds for a
profit shortly after the bonds are issued.
·
Bids made above the Clearing Yield will not receive an
allocation of bonds and some bids made at or below the
Clearing Yield may not receive an allocation of bonds.
·
Potential investors should not bid for a greater principal
amount of bonds than they are prepared to purchase.
See "Risk Factors" below for a discussion of certain factors you
should consider before deciding to invest in the bonds.

Conversion of the payment amounts
All amounts due in respect of principal or interest will be paid in U.S. dollars,

calculated by the calculation agent by translating the Colombian peso
amounts into U.S. dollars at the Average Representative Market Rate on the
applicable Rate Calculation Date (as defined below).

Status
The bonds will be direct, general, unconditional, unsecured and
unsubordinated external indebtedness of Colombia and will be backed by the
full faith and credit of Colombia. The bonds will rank equal in right of
payment with all of Colombia's present and future unsecured and
unsubordinated external indebtedness.

Withholding Tax and Additional
We will make all payments on the bonds without withholding or deducting
Amounts

any taxes imposed by Colombia, subject to certain specified exceptions. For
more information, see "Description of the SecuritiesDebt Securities
Additional Amounts" on page 4 of the prospectus.

Further Issues
Colombia may, without the consent of the holders, create and issue additional
bonds that may form a single series of bonds with the outstanding bonds;
provided that such additional bonds do not have, for purposes of U.S. federal
income taxation (regardless of whether any holders of such additional bonds
are subject to U.S. federal tax laws), a greater amount of original issue
discount than the bonds have as of the date of the issue of such additional
bonds.

Listing
Application has been made to list the bonds on the official list of the
Luxembourg Stock Exchange and to trade them on the Euro MTF Market of
the Luxembourg Stock Exchange.

Governing Law
New York. The laws of Colombia will govern all matters relating to
authorization and execution by Colombia.

Additional Provisions

The bonds will contain provisions regarding acceleration and future
modifications to their terms that differ from those applicable to Colombia's
outstanding public external indebtedness issued prior to January 21, 2004.

S-7

Those provisions are described in the sections entitled "Description of the
Securities--Debt Securities--Default and Acceleration of Maturity," "--
Collective Action Securities" and "--Meetings and Amendments--Approval
(Collective Action Securities)" in the accompanying prospectus.

Calculation Agent

The Bank of New York

Use of Proceeds
The net proceeds of the sale of the bonds will be approximately
U.S. $994,637,075, after deduction of the underwriting discount and of certain
expenses payable by Colombia (which are estimated to be U.S. $350,000).
Colombia will use the net proceeds, in part, for liability management
transactions, including payment of the purchase price for certain securities
which may be purchased in connection with Colombia's planned offer to
purchase for cash on the terms and subject to the conditions set forth in an
Offer to Purchase, dated June 12, 2007, provided that all such liability
management transactions are settled on the same day and, in part, to cover the
portion of the 2007 budgetary expenditures corresponding to the net proceeds
of this offering that would otherwise have been financed by Peso-
denominated instruments offered in the local Colombian market.

Underwriting
Under the terms and subject to the conditions contained in an underwriting
agreement, dated as of June 12, 2007, Citigroup Global Markets Inc. and
Deutsche Bank Securities Inc., as underwriters, are obligated to purchase the
bonds. The bonds will be allocated to investors pursuant to a modified Dutch
auction procedure that is more fully described in Annex A. Delivery of the
bonds is expected to be made on June 28, 2007; provided, however, that
bonds will not be delivered to any purchaser that (i) has not paid the
applicable purchase price for the bonds or (ii) has not provided satisfactory
documentation in connection with the delivery of the bonds (a "Disqualified
Purchaser"). Colombia will not be obligated to deliver and the underwriters
will not be obligated to purchase or pay for bonds in respect of any
Disqualified Purchaser.

S-8

RISK FACTORS
This section describes certain risks associated with investing in the bonds. You should consult your financial and
legal advisors about the risk of investing in the bonds. Colombia disclaims any responsibility for advising you on these
matters.
Risk Factors Relating to the Bonds
The price at which the bonds will trade in the secondary market is uncertain.
Colombia has been advised by the underwriters that they intend to make a market in the bonds but are not
obligated to do so and may discontinue market making at any time without notice. Application has been made to list the
bonds on the official list of the Luxembourg Stock Exchange and to trade them on the Euro MTF Market of the Luxembourg
Stock Exchange. No assurance can be given as to the liquidity of the trading market for the bonds. The price at which the
bonds will trade in the secondary market is uncertain.
The bonds will contain provisions that permit Colombia to amend the payment terms without the consent of all
holders.
The bonds will contain provisions regarding acceleration and voting on future amendments, modifications and
waivers, which are commonly referred to as "collective action clauses." Under these provisions, certain key provisions of the
bonds may be amended, including the maturity date, interest rate and other payment terms, with the consent of the holders of
75% of the aggregate principal amount of the outstanding bonds. See "Description of the Securities--Debt Securities--
Default and Acceleration of Maturity," "--Collective Action Securities" and "--Meetings and Amendments--Approval
(Collective Action Securities)" in the accompanying prospectus.
Risks Factors Relating to Foreign Currency Securities
This prospectus supplement and the prospectus do not describe all the risks of an investment in securities
denominated in currencies other than U.S. dollars. If you are unsophisticated with respect to foreign currency transactions,
these bonds are not an appropriate investment for you.
The information in this section is directed to investors who are U.S. residents and does not address risks for
investors who are not U.S. residents. We disclaim any responsibility to advise prospective purchasers who are residents of
countries other than the United States with respect to any matters that may affect the purchase, holding or receipt of payments
of the bonds. If you are not a U.S. resident, you should consult your own financial and legal advisors.
If the Colombian peso depreciates against the U.S. dollar, the effective yield on the bonds will decrease below the
interest rate on the bonds, and the amount payable at maturity may be less than your investment, resulting in a loss to you.
Rates of exchange between the U.S. dollar and the Colombian peso have varied significantly over time. Historical
peso/U.S. dollar exchange rates are presented in the table under the heading "Certain Defined Terms and Conventions--
Colombian Peso Information." However, historical trends do not necessarily indicate future fluctuations in rates, and should
not be relied upon as indicative of future trends.
Currency exchange rates can be volatile and unpredictable. If the Colombian peso depreciates against the U.S.
dollar, the effective yield on the bonds will decrease below the interest rate on the bonds and the amount payable at maturity
may be less than your investment, resulting in a loss to you. Depreciation of the Colombian peso against the U.S. dollar may
also adversely affect the market value of the bonds.

Government policy or actions could adversely affect the exchange rate between the peso and the U.S. dollar and
an investment in the bonds.
Colombia presently has a floating exchange rate. However, the Central Bank of Colombia has from time to time
intervened in the foreign exchange market to support the value of the peso or to adversely affect the value of the peso. On
May 6, 2007, the Central Bank adopted regulatory measures to control the appreciation of the peso. Such measures included
the establishment of a 40% reserve requirement on any disbursement of external loans for a six-month period and the
imposition of a ceiling on the leverage of financial sector institutions' derivative operations. A few days later, on May 23,
2007, the Ministry of Finance decided to partially restrict short-term portfolio inflows in an effort to reduce the pressure on
the peso/U.S. dollar exchange rate. The measure taken by the Ministry of Finance establishes a requirement of a 40% deposit
at the Central Bank for short-term portfolio investments for a period of six months with no interest payable. For more
information, see "Recent Developments--Monetary System--Appreciation of the Peso and measures taken by the
S-9

Government." Such interventions or other governmental actions could adversely affect the value of the bonds, as well as the
yield on the bonds and the amount payable to you at maturity.
Even in the absence of governmental action directly affecting currency exchange rates, political or economic
developments in Colombia or elsewhere could lead to significant and sudden changes in the exchange rate between the peso
and the U.S. dollar.
Exchange controls could affect the peso/U.S. dollar exchange rate and the amount payable on the bonds.
Colombia has a system of exchange controls that has been in place since 1967. However, exchange control
regulations have been substantially relaxed over the past twelve years, and the peso/U.S. dollar exchange rate is no longer set
by the Government or by the Central Bank. The peso/U.S. dollar exchange rate is set by the market, based upon the supply
of, and demand for, U.S. dollars. Currently, the system of exchange controls only determines which transactions involving
inflows or outflows of foreign currency are permitted. In addition, the applicable exchange control regulations provide that
the incurrence of foreign indebtedness by Colombia, as well as payments to service Colombia's external debt, are permitted
transactions. Changes in exchange control regulations could cause the value of the peso to depreciate against the U.S. dollar,
resulting in a reduced yield to you, a possible loss on the bonds and a possible adverse impact on the market value of the
bonds.
Risk Factors Relating to Colombia
Colombia is a foreign sovereign state and accordingly it may be difficult to obtain or enforce judgments against it.
Colombia is a foreign state. As a result, it may not be possible for investors to effect service of process within their
own jurisdiction upon Colombia or to enforce against Colombia judgments obtained in their own jurisdictions. See
"Description of the Securities--Jurisdiction; Enforceability of Judgments" in the accompanying prospectus.
Certain economic risks are inherent in any investment in an emerging market country such as Colombia.
Investing in an emerging market country such as Colombia carries economic risks. These risks include economic
instability that may affect Colombia's economic results. Economic instability in Colombia and in other Latin American and
emerging market countries has been caused by many different factors, including the following:
·
high interest rates;
·
changes in currency values;
·
high levels of inflation;
·
exchange controls;
·
wage and price controls;

·
changes in economic or tax policies;
·
the imposition of trade barriers; and
·
internal security issues.
Any of these factors, as well as volatility in the markets for securities similar to the bonds, may adversely affect
the liquidity of, and trading markets for, the bonds. See "Forward-looking Statements" in the accompanying prospectus. For
further information on internal security, see "Recent Developments--Republic of Colombia--Internal Security."
An increase in Colombia's debt-to-GDP ratio could increase the burden on Colombia's ability to service its debt.
Colombia's ratio of total net non-financial public sector debt to GDP increased from 48.5% in 2001 to 56.7% in
2002 but decreased to 53.9% in 2003 and further to 49.2% in 2004. Colombia's ratio of total net non-financial public sector
debt to GDP stood at 45.8% at December 31, 2005 and further decreased to 43.1% at December 31, 2006. Any increase in the
non-financial public sector debt to GDP ratio could have an adverse effect on Colombia's economy and ability to service its
debt. See "Recent Developments--Public Sector Debt" in this prospectus supplement. See also "Recent Developments--
Republic of Colombia" regarding a change in the principal indicator the Government will be using with respect to the public
debt balance.

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