—EDITED—
This post contains incorrect information, please take a look at this post for clarification!
—END EDIT—
Hello Kenneth
Looking at your output something seems to be a bit off. First of all, is the output copy and pasted exactly as it was from your output? This does not seem to be the case because the sh ip route vrf BLUE bgp output should show the routes in ascending order, so 1.1.1.1 should be first. It seems some manipulation was done. However, having said that, this once again doesn’t match up with the ip route commands shown at the beginning of your post.
Each static route must point to the loopback of the OTHER VRF. What you’ve done is pointed them to the loopbacks of the SAME VRF. It should read:
ISP(config)#ip route vrf BLUE 1.1.1.1 255.255.255.255 192.168.12.1
ISP(config)#ip route vrf RED 3.3.3.3 255.255.255.255 192.168.23.3
Once those routes are redistributed using BGP, the show ip route commands should look something like this:
ISP#show ip route vrf RED bgp
3.0.0.0/32 is subnetted, 1 subnets
B 3.3.3.3 [20/0] via 192.168.23.3 (BLUE), 00:06:41
192.168.23.0/24 is variably subnetted, 2 subnets, 2 masks
B 192.168.23.0/24 is directly connected, 00:08:20, GigabitEthernet0/2
ISP#show ip route vrf BLUE bgp
1.0.0.0/32 is subnetted, 1 subnets
B 1.1.1.1 [20/0] via 192.168.12.1 (RED), 00:07:23
192.168.12.0/24 is variably subnetted, 2 subnets, 2 masks
B 192.168.12.0/24 is directly connected, 00:09:00, GigabitEthernet0/1
I hope this has been helpful!
Laz