That is why one of the fundamental challenges of the current economic policy must be to prevent cycles of boom and bust from building up and, in doing this, to ensure that the Colombian economy makes the most of the globalization process. With this in mind, in the next section I will spend some time on the causes of our past business cycles. III.
Terms of trade, capital flows and business cycles  Chart 1 plots the four Colombian business cycles since the 1970s in terms of growth rates. It seems that very high growth rates where in all cases followed by a slowdown to much lower rates a few years later. GDP per capita fell for at least one year during the slowdown.