Chile Country Analysis

Introduction: Country overview and background

When mentioning the emerging market of the Latin America, people often thinking about cities like Brazil or Argentina, however, the Pacific Alliance (Mexico, Peru, Colombia and Chile) is also rising up. (CNBC, 2015). Among these countries, Chile is the one which is rapidly developing its economy with its natural resources and government policy. It also got a high ranking in sustainability of the state, and democratic development in the region of Latin America (The World Bank,2012). Furthermore, according to the BBC news, Chile had the fastest-growing economy in the 1990’s in its region. (BBC,2012)

It is believed that Chile is one of the emerging markets which is worth for investigating in Latin America. Analysis would be made in different perspectives, for instance, opportunities and threats of Chile, Trade, investment and migration market of Chile and ideological, economic and political factors that affect Chile.

Current status

Currently, Chile is developing rapidly which shown in different kinds of statistics. For example, Chile has a growing GDP from USD$123 billion in 2005 to USD$268 billion in 2012 (UNdata, 2015). Also, there were journal that mentioning Chile and Colombia are enjoying a positive economic backdrop, with both expected to post 5% GDP growth this year. (SIMMONS, 2012)

Chile is today one of South America's most stable and prosperous nations. (BBC, 2012). It is a country that stays away from revolutions and random government compare to the Latin America.

After 1990s, Chile has rapidly joined some of the international organizations, including United Nations (UN), Organization of American States, Community of Democracies, Asia-Pacific Economic Cooperation forum, Organization for Economic Cooperation and Development, International Monetary Fund (IMF), World Bank, and World Trade Organization (WTO). Chile is also a member of the Pacific Alliance (which have mentioned) Union of South American Nations (UNASUR), and Community of Latin American and Caribbean States (CELAC). (Bureau of Western Hemisphere Affairs, 2013) It is believed that the Chile government try her best in order to get a seat among the so-called ‘big and strong countries’.

Country analysis 

Trade, investment and migration market of Chile

For the trading environment of Chile, the United States has a bilateral free trade agreement with Chile (Bureau of Western Hemisphere Affairs, 2013). It allows more freedom for trading within two countries. Also, trade barriers are reduced as to attract more capital flow.

Moreover, according to one of the article written by Jim Powell, ‘Chile is the world's largest copper producer, which is both a blessing and a curse, depending on the state of the world economy. Longer-term, I think the resource hungry world will buy every bit of copper that Chile produces, and will pay a premium to get it.’ (Powell, 2013) although holding the largest resources of copper may be a ‘curse’, at present, there are advantages to sell them since the export rate of chopper remains high.

In 2004, the top five products exported by Chile are refined Copper (28%), Copper Ore (20%), Raw Copper (4.1%), Sulfate Chemical Woodpulp (3.3%), and Wine (2.4%) (Simoes ,2014). Copper accounts for more than 50% of its total export. As Chile is rich in Copper, she can take this as an advantage can develop copper related industry or export to more countries and earn foreign exchange.

Chile is a highly open economy which is the reason of investing in Chile. Chile has signed 23 free trade agreements with 60 countries, and holds double taxation agreements with 24 countries. Hence, by these agreements, people are attracted to Chile and input their money there.