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Chile: Economic and Political Outline
Economic Indicators | Foreign Trade in Figures | Sources of General Economic Information | Political Outline
Although very open, Chile was able to resist the global crisis in 2009 (-1.5% of GDP), as well as to the impact of a violent earthquake that occurred on February 27 2010 and which cost the country an estimated 29,7 billion USD, i.e. 17% of its GDP. Despite the tightening of monetary policy and uncertainty at the international level, the newly resumed growth reached 5.2% in 2010 and 6.5% in 2011, thanks to strong domestic demand. Chile has the best performing economy in Latin America and its growth rate, one of the strongest in the OECD since 2010, should remain sound in 2012. The country is considered by a model of economic stability. Chile, which joined the OECD in January 2010, remains exposed to fluctuations in copper prices, the country being the largest producer and exporter of this metal.
Following the violent earthquake that hit the country in 2010, in 2011 the government continued to focus on rehabilitation and reconstruction through fiscal measures and appropriate spending. The authorities have set themselves the goal of reducing the structural deficit of the central government to 1% of GDP by 2014. The purpose of the independent central bank of Chile is to keep inflation at around 4%. The level of public debt is very low: only 13% of GDP in 2011.
In the long term, Chile must improve its productivity and break from its dependence in relation to copper and develop its food production.
Unemployment rate has exceeded 8% in 2011 and affects mainly the young. Even though Chile has one of the highest GDP per capita in Latin America, poverty continues to affect almost 20% of its population and there is a high level of inequality.
| Main Indicators | 2009 | 2010 | 2011 | 2012 (e) | 2013 (e) |
| GDP (billions USD) | 161.08 | 203.30e | 243.05e | 246.51 | 260.27 |
| GDP (Constant Prices, Annual % Change) | -1.7 | 5.2e | 6.5 | 4.7 | 4.5 |
| GDP per Capita (USD) | 9,484 | 11,827 | 13,970e | 13,999 | 14,603 |
| General Government Balance (in % of GDP) | -4.4 | -2.0 | -1.7e | -1.1 | -1.0 |
| General Government Gross Debt (in % of GDP) | 6.2 | 9.2e | 10.5 | 10.6 | 10.6 |
| Inflation Rate (%) | 1.7 | 1.5e | 3.1e | 3.1 | 3.0 |
| Unemployment Rate (% of the Labor Force) | 9.6 | 8.3 | 7.2 | 7.2 | 7.2 |
| Current Account (billions USD) | 2.57 | 3.80e | 0.13 | -3.63 | -4.55 |
| Current Account (in % of GDP) | 1.6 | 1.9e | 0.1 | -1.7 | - |
Source: IMF - World Economic Outlook Database ; World Bank , Last Available Data
Note: (e) Estimated Data
Chile's economy is dominated by the industrial and the service sectors. These two contribute to almost 95% of the GDP. The main activity sectors in Chile are mining (copper, coal and nitrate), manufactured products (agri-food processing, chemicals, wood) and agriculture (fishing, vineyard, fruits).
The agricultural sector contributes about 5.2% to the GDP, the industrial sector to more than 24.8% and the services to more than 70%.
About 13% of the population work in the agricultural sector, 23% in the industries and 64% in the services.
The two main challenges in the Chilean economic are: breaking off from its traditional dependence on the price of copper (copper's production represents 50% of the country's exports, the collapse in its price during the financial crisis had a strong effect in Chile's economy) and developing the production of a self-sufficient food supply.
Agriculture and livestock farming are the main activities of the center and the south of the country. Fruit and vegetable exports have reached historical records, thanks to a deliberate strategy of conquering the European, North-American and Asian markets, implemented in the 1990s. Chile benefits from its location in the Southern Hemisphere to offer fruits out of season in the countries of the Nothern Hemisphere.
| Breakdown of Economic Activity By Sector | Agriculture | Industry | Services |
| Employment By Sector (in % of Total Employment) | 11.2 | 23.2 | 65.6 |
| Value Added (in % of GDP) | 3.4 | 42.7 | 53.9 |
| Value Added (Annual % Change) | 0.5 | -4.1 | -0.4 |
Source: World Bank - Last Available Data.
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| Monetary Indicators | 2006 | 2007 | 2008 | 2009 | 2010 |
| Chilean Peso (CLP) - Average Annual Exchange Rate For 1 USD | 530.28 | 522.46 | 522.46 | 560.86 | 510.25 |
Source: World Bank - Last Available Data.
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Distribution of Economic freedom in the world
Source: 2011 Index of Economic freedom, Heritage Foundation
Note: The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labor freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.
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Chile has a very open economy which depends highly on international trade. In 2011 foreign trade represented 90% of the country's GDP. Chile respects the terms of free-trade and has signed free-trade agreements (FTAs) with several important economies, especially with the European Union, the United States, China and South Korea.
Chile's top three customers are China, the United States and Japan. The country mainly exports copper, fruits and fish products.
Chile's main suppliers are the United States, China, Argentina and Brazil. Imports involve mainly mineral fuels and oil, machinery, vehicles and electric equipment and electronics.
Chile's trade balance is structurally positive, a trend that should continue. Trading with other countries remains dynamic. Its comparative advantages on the economic level (mining income, competitive and counter-seasonal agriculture) give it access to the large markets of North America, Europe and Asia-Pacific (and recently of South America as well, especially Brazil).
| Foreign Trade Indicators | 2007 | 2008 | 2009 | 2010 | 2011 |
| Imports of Goods (million USD) | 47,164 | 61,911 | 42,427 | 58,241 | 74,199 |
| Exports of Goods (million USD) | 67,972 | 66,465 | 53,735 | 69,622 | 80,586 |
| Imports of Services (million USD) | 9,733 | 11,386 | 9,351 | 11,568 | 13,710 |
| Exports of Services (million USD) | 8,851 | 10,677 | 8,401 | 10,685 | 12,615 |
| Imports of Goods and Services (Annual % Change) | 14.5 | 12.2 | -14.3 | 26.3 | - |
| Exports of Goods and Services (Annual % Change) | 7.6 | 3.1 | -5.6 | -0.3 | - |
| Imports of Goods and Services (in % of GDP) | 33.2 | 40.9 | 30.8 | 34.9 | - |
| Exports of Goods and Services (in % of GDP) | 47.2 | 44.8 | 38.7 | 34.6 | - |
| Trade Balance (million USD) | 23,941 | 8,529 | 14,117 | 15,855 | - |
| Trade Balance (Including Service) (million USD) | 22,954 | 7,565 | 12,673 | 14,836 | - |
| Foreign Trade (in % of GDP) | 80.5 | 85.7 | 69.5 | 69.5 | - |
Source: WTO - World Trade Organization ; World Bank , Last Available Data
| Main Customers (% of Exports) |
2010 |
| China | 24.6% |
| Japan | 10.8% |
| United States | 10.0% |
| Brazil | 6.1% |
| South Korea | 5.8% |
| See More Countries | 42.8% |
| Main Suppliers (% of Imports) |
2010 |
| China | 17.6% |
| United States | 17.5% |
| Argentina | 8.4% |
| Brazil | 8.3% |
| South Korea | 6.2% |
| See More Countries | 42.1% |
Source: Comtrade, Last Available Data
Source: Comtrade, Last Available Data
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Source: Worldwide Press Freedom Index 2011, Reporters Without Borders
Note: The world rankings, published annually, measures the violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position is assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire sent to partner organizations,150 RWB correspondents, journalists, researchers, jurists and activists of human rights, including the main criteria - 44 in total - to assess the situation of press freedom in a given country. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).
Map of freedom 2010
Source: Freedom House
Note: The Indicator of Political Freedom provides an annual evaluation of the state of freedom in a country as experienced by individuals. The survey measures freedom according to two broad categories: political rights and civil liberties. The ratings process is based on a checklist of 10 political rights questions (on Electoral Process, Political Pluralism and Participation, Functioning of Government) and 15 civil liberties questions (on Freedom of Expression, Belief, Associational and Organizational Rights, Rule of Law, Personal Autonomy and Individual Rights). Scores are awarded to each of these questions on a scale of 0 to 4, where a score of 0 represents the smallest degree and 4 the greatest degree of rights or liberties present. The total score awarded to the political rights and civil liberties checklist determines the political rights and civil liberties rating. Each rating of 1 through 7, with 1 representing the highest and 7 the lowest level of freedom, corresponds to a range of total scores.
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Last Updates: May 2012