Chile

ECONOMICS

Chile has a market-oriented economy characterized by a high level of foreign trade and a reputation for strong financial institutions and sound policy that have given it the strongest sovereign bond rating in South America. Exports of goods and services account for approximately one-third of GDP, with commodities making up some 60% of total exports. Copper is Chile’s top export and provides 20% of government revenue.

From 2003 through 2013, real growth averaged almost 5% per year, despite a slight contraction in 2009 that resulted from the global financial crisis. Growth slowed to an estimated 1.4% in 2017. A continued drop in copper prices prompted Chile to experience its third consecutive year of slow growth.

Chile deepened its longstanding commitment to trade liberalization with the signing of a free trade agreement with the US, effective 1 January 2004. Chile has 26 trade agreements covering 60 countries including agreements with the EU, Mercosur, China, India, South Korea, and Mexico. In May 2010, Chile signed the OECD Convention, becoming the first South American country to join the OECD. In October 2015, Chile signed the Trans-Pacific Partnership trade agreement, which was finalized as the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP) and signed at a ceremony in Chile in March 2018.

The Chilean Government has generally followed a countercyclical fiscal policy, under which it accumulates surpluses in sovereign wealth funds during periods of high copper prices and economic growth, and generally allows deficit spending only during periods of low copper prices and growth. As of 31 October 2016, those sovereign wealth funds - kept mostly outside the country and separate from Central Bank reserves - amounted to more than $23.5 billion. Chile used these funds to finance fiscal stimulus packages during the 2009 economic downturn.

In 2014, then-President Michelle BACHELET introduced tax reforms aimed at delivering her campaign promise to fight inequality and to provide access to education and health care. The reforms are expected to generate additional tax revenues equal to 3% of Chile’s GDP, mostly by increasing corporate tax rates to OECD averages.

 

1990 2000 2010 2018
GNI, Atlas method (current US$) (billions) 31.17 77.65 183.35 273.79
GNI per capita, Atlas method (current US$) 2,350 5,060 10,750 14,620
GNI, PPP (current international $) (billions) 56.7 141.42 288.02 443.89
GNI per capita, PPP (current international $) 4,270 9,220 16,880 23,700
GDP (current US$) (billions) 33.11 77.86 218.54 298.26
GDP growth (annual %) 3.3 5.3 5.8 3.9
Inflation, GDP deflator (annual %) 22.5 4.3 9 2.4
Agriculture, forestry, and fishing, value added (% of GDP) 8 5 4 4
Industry (including construction), value added (% of GDP) 39 31 36 30
Exports of goods and services (% of GDP) 32 31 38 29
Imports of goods and services (% of GDP) 29 29 31 29
Gross capital formation (% of GDP) 26 22 23 22
Revenue, excluding grants (% of GDP) 18.8 20.9 21.4 22
Net lending (+) / net borrowing (-) (% of GDP) 0.3 -0.6 -0.4 -1.7
States and markets
Time required to start a business (days) .. 42 37 6
Domestic credit provided by financial sector (% of GDP) .. 83.7 104.5 132.5
Tax revenue (% of GDP) 13.3 16.2 17.4 18.2
Military expenditure (% of GDP) 3.4 2.7 2.2 1.9
Mobile cellular subscriptions (per 100 people) 0.1 22.2 116.3 134.4
Individuals using the Internet (% of population) 0 16.6 45 82.3
High-technology exports (% of manufactured exports) .. .. 6 6
Statistical Capacity score (Overall average) .. .. 94 90
Global links
Merchandise trade (% of GDP) 49 48 60 50
Net barter terms of trade index (2000 = 100) 114 100 216 213
External debt stocks, total (DOD, current US$) (millions) .. .. .. ..
Total debt service (% of exports of goods, services and primary income) .. .. .. ..
Net migration (thousands) 4 42 164 559
Personal remittances, received (current US$) (millions) 0 13 62 66
Foreign direct investment, net inflows (BoP, current US$) (millions) 661 4,860 16,020 6,082
Net official development assistance received (current US$) (millions) 109.1 50.5 181.9 70.1
1990 2000 2010 2018
GNI, Atlas method (current US$) (billions) 1.59 1.51 10.84 10.46
GNI per capita, Atlas method (current US$) 270 180 910 680
GNI, PPP (current international $) (billions) 4.12 6.32 21.02 24.61
GNI per capita, PPP (current international $) 690 760 1,760 1,590
People
Income share held by lowest 20% .. 6.3 4.9 ..
GDP (current US$) (billions) 1.74 1.39 10.67 11.24
GDP growth (annual %) -4.2 -0.9 13.6 2.4
Inflation, GDP deflator (annual %) 8 5.3 6.4 5
Agriculture, forestry, and fishing, value added (% of GDP) 28 41 52 45
Industry (including construction), value added (% of GDP) 17 11 12 14
Exports of goods and services (% of GDP) 13 17 37 36
Imports of goods and services (% of GDP) 28 35 44 38
Gross capital formation (% of GDP) 7 23 34 21
Revenue, excluding grants (% of GDP) .. .. .. ..
Net lending (+) / net borrowing (-) (% of GDP) .. .. .. ..
States and markets
Time required to start a business (days) .. 62 62 58
Domestic credit provided by financial sector (% of GDP) .. .. .. ..
Tax revenue (% of GDP) .. .. .. ..
Military expenditure (% of GDP) 2 1.4 5.8 2.1
Mobile cellular subscriptions (per 100 people) 0 0.1 24.1 45.1
Individuals using the Internet (% of population) 0 0 1.7 6.5
High-technology exports (% of manufactured exports) .. .. .. ..
Statistical Capacity score (Overall average) .. .. 57 51
Global links
Merchandise trade (% of GDP) 27 36 56 48
Net barter terms of trade index (2000 = 100) 112 100 182 159
External debt stocks, total (DOD, current US$) (millions) 514 1,099 2,158 3,242
Total debt service (% of exports of goods, services and primary income) 4.3 .. .. ..
Net migration (thousands) -10 219 100 10
Personal remittances, received (current US$) (millions) 1 .. .. ..
Foreign direct investment, net inflows (BoP, current US$) (millions) 9 115 313 662
Net official development assistance received (current US$) (millions) 310.6 131.3 490.2 875.4

 

 

1990 2000 2010 2017
GNI, Atlas method (current US$) (billions) 569.29 695.71 1,508.74 1,573.49
GNI per capita, Atlas method (current US$) 20,480 22,610 44,370 42,870
GNI, PPP (current international $) (billions) 538.64 874.38 1,334.17 1,691.10
GNI per capita, PPP (current international $) 19,380 28,420 39,230 46,070
GDP (current US$) (billions) 593.93 742.29 1,613.46 1,653.04
GDP growth (annual %) 0.2 5.2 3.1 3
Inflation, GDP deflator (annual %) 3.4 4.3 2.9 2.3
Agriculture, forestry, and fishing, value added (% of GDP) .. .. 1 1
Industry (including construction), value added (% of GDP) .. .. 27 28
Exports of goods and services (% of GDP) 25 44 29 31
Imports of goods and services (% of GDP) 25 39 31 33
Gross capital formation (% of GDP) 21 21 24 24
Revenue, excluding grants (% of GDP) 19.8 20.9 16.9 17.4
Net lending (+) / net borrowing (-) (% of GDP) -4.5 2.2 -2.2 0.1
States and markets
Time required to start a business (days) .. 4 6 2
Domestic credit provided by financial sector (% of GDP) 100.6 111.1 172.3 ..
Tax revenue (% of GDP) 14.2 14.9 11.8 12.2
Military expenditure (% of GDP) 2 1.1 1.2 1.3
Mobile cellular subscriptions (per 100 people) 2.1 28.4 75.6 85.9
Individuals using the Internet (% of population) 0.4 51.3 80.3 91.2
High-technology exports (% of manufactured exports) 14 18 14 13
Statistical Capacity score (Overall average) .. .. .. ..
Global links
Merchandise trade (% of GDP) 42 70 49 52
Net barter terms of trade index (2000 = 100) .. 100 118 106
External debt stocks, total (DOD, current US$) (millions) .. .. .. ..
Total debt service (% of exports of goods, services and primary income) .. .. .. ..
Net migration (thousands) 699 1,027 1,146 1,100
Personal remittances, received (current US$) (millions) .. 555 1,199 1,337
Foreign direct investment, net inflows (BoP, current US$) (millions) 7,581 68,309 29,713 27,526
Net official development assistance received (current US$) (millions) .. .. .. ..