Overview of Chile

Chile is a long narrow ribbon of land stretching more than 4,000 kilometers  along the west coast of South America with an average width of approximately 180  kilometers and has a continental area of 764,000 square kilometers excluding the Antarctic territory. Currently the Chilean population is approximately 18 million people in total.

Located between Andes mountains on the east and the Pacific Ocean on the west. Chile has Peru, Bolivia and Argentina as neighboring countries. The capital of Chile is Santiago which is the commercial center of the country.

Chile’s official currency is the Chilean Peso (CLP), which, as of March 31, 2020 US$ 1 = Chilean Pesos 796,23.

CHILE: LATIN AMERICAN LEADER

Chile has a market-oriented economy characterized by a high-level foreign trade, a well known reputation for its strong financial institutions in Latino America and a solid policy that has reached AA- of sovereign bond rating. Chile has more bilateral and regional trade agreements than any other country in the region, including with the European Union, Mercosur, China, South Korea, Mexico, and Japan. In May 2010, Chile signed the OECD Convention, becoming the first South.

AMERICAN COUNTRY TO JOIN OECD

Chile has a large amount of mineral resources such as copper, lithium and iodine. In relation to copper, Chile is the world’s largest copper producer and exporter. The success of mining industry is one of the reasons behind sustained growth and development of Chilean economy. The main customers for copper exports are mostly in Asia, Western Europe and China.

• Chile has a lot of attractive aspects not only in regards to mineral resources as follow;
• Chile: Latin American leader, General Attractive Aspects.
• Institutional and Financial Strength and Low Country Risk.
• Friendly Economy (TFA 64 countries).
• Great Business Environment and Economic Freedom.
• High public security (In relation to Latam).
• Highly Skilled and Competitive Human Resources.
• Suitable circumstances for the industry of  fishery and forestry.
• Double taxation Agreements (DTA) with a lot of jurisdictions.

ATTRACTIVE INDUSTRY

Chilean products and services are highly sought after worldwide. ProChile(*) can help foreign buyers link up with Chile’s top exporters.

The country has an extensive export lineup that includes food industry, mining supplies, biotechnology, global services (off shoring), and industrial logistics. ProChile is responsible for implementing and enhancing Chile’s trade policy. It provides support to small and medium-sized Chilean enterprises, helping to encourage and diversify exports for Chilean products and services by increasing export markets and companies

ProChile Trade Commissions around the world offer no-cost expert advice to potential investors and buyers interested in Chilean products and services.

(*) ProChile is an institution aimed to promoting goods and services exports from out country. It boosts foreign investment and tourism. Fifty offices are established worldwide and 15 within our country, offering useful information regarding the national exports.

The food and drinks industry has become the second-largest currency earner, just below mining. Alcoholic drinks ranging from wine, pisco (a grape brandy spirit) to beer and fruit/vegetable juices are key components of the Chilean food industry.

Chilean wine is the most emblematic export product and the country is the world’s fifth-largest wine producer. Beyond food and drinks, the Chilean industrial sector is a competitive global stakeholder notably in forestry, agrobusiness, fisheries, aquaculture and mining.

InvestChile(*) aims to attract high-impact investment in order to grow the Chilean economy and diversify its production and export base. InvestChile provides assistance to foreign companies interested in establish in Chile. Likewise, InvestChile promotes foreign investment in specific economic areas, including the food industry, biotechnology, mining supplies, offshoring, and manufacturing. Moreover, InvestChile offers incentives to industries in these sectors and gives specific assistance to foreign investors. InvestChile has offices in the US, Germany, and Japan to gather business opportunities of every kind. It helps companies interested in building Chile-based projects serving Latin America, the US or European markets. InvestChile has a specialized team of professionals to support foreign companies with services and incentives to national and foreign investors, to enable the evaluation, installation and materialization of investment in Chile.

The sector with highest development potential is the food sector. Chile is acknowledged worldwide by the quality of its wine, fresh fruits and sea food products, such as salmon, being the second largest exporter of salmon around the world. InvestChile’s Food Industry Investment Attraction Program supports food industry entrepreneurs in all stages production with public funding and significant investment available for technology transfers. The Mining Suppliers Investment Program is set up to attract foreign investors that have interest in establish in Chile.

(*) InvestChile was created by CORFO (Corporación de Fomento de la Producción) which was created in 1939 and played a major role in the development of domestic activities essential to development the country, including the mining, energy, agriculture, commerce and transport sectors.

Chile has taken significant steps to incorporate biotechnology into its economy including a series initiatives aimed at biotechnology companies abroad, a new regulatory framework and economic incentives. Meanwhile, manufacturing are supported with expert consultancy. InvestChile can arrange meetings with Chilean counterparts, visits to industrial parks, as well as arrange contacts with trade associations and potential supply vendors.

CHILE’S GROWTH

Chile has spectacularly transformed itself over the past decades. Despite this progress, there exist space for further positive changes.

Once a relatively poor country, Chile has become prosperous through macroeconomic policy, structural reforms, trade and investment and regulation. A rich endowment of copper and other mineral reserves has been used cautiously to foster resilience facing unexpected headwinds. Moreover, a stable democracy with an effective rule of law has been established.

Between 1986 and 2007, Chile’s income per capita grew at around twice OECD rate and the income gap with richer countries was reduced substantially. For the government achieve fast growth while reducing income inequality, the main challenge will be to maintain the delicate balance between pursuing a strong recovery and preserving price stability.

While Chile has made substantive progress in upgrading its production structure to higher value-added activities, restrictions in product and labor markets have prevented full development. Competition in some areas of product markets, especially in the services sector, remains weak by OECD standards. Reducing regulatory red tape for business start-ups and easing restrictions on entry in specific services sectors, would strengthen competitive pressure. This would also encourage entrepreneurship and innovation.

Structural reforms in labor markets would raise the participation rate of women and youth and enhance labor productivity. Despite substantive progress in childcare for working women, there remains scope further expand these programs.