China - 中国国际贸易促进委员会

TRADE
It Pays to Invest in Chile
By Li Zhen
Chile is the first country to establish cooperative
relations with China in South America,
and also the first one to support China’s accession
to the World Trade Organization. In
2005, Chile and China signed a free trade agreement.
After that, China has become Chile’s largest trading
partner, and Chile become China’s second largest
partner in South America.
At The Fifth Chinese Enterprises Outbound Investment
Forum, Chilean Ambassador Luis Schmidt
said that Chile was regarded as a very attractive Investment
destination for many countries because of its
political stability, social progress, good macroeconomic
performance. In 2010, Chile maintained a 5.2% economic
growth rate, one of the fastest growing economies
in Latin America.
Although Chile ranked third in Latin America as
to accepting foreign direct investment, but investment
from China has been kept low. According to Chilean
Foreign Investment Committee Executive Vice President
Matias Mori, foreign direct investment in Chile
mainly went to mining areas, services, and electricity,
gas and water with its main investor being Spain and
Canada. Foreign investment from Asia accounted
for only 0.2% of the total investment, and almost all
from Japan. Although China is Chile’s largest trading
partner in Latin America, and Chile is China’s second
largest trading partner. However, the strong trade relations
between the two countries have not converted to
investment growth. Matias Mori said that
in the process of rapid economic growth,
China’s huge demand for resources makes
Chinese enterprises to invest in Chile a wiser
choice.
The outbreak of international financial
crisis poses a serious challenge to macro
economy and financial systems of developed
countries. However, the good macroeconomic
situation and the financial system
have become an important factor to attract
foreign direct investment in Chile. Fredrico
Dietrich, Chief Representative of
Chile Bank in Beijing, said Chile has
good macro-economic policies,
good investment environment
and mechanism. Meanwhile,
Chile is a very
open economy, with its international trade accounting
for 6.4% of GDP. With more than 60 free trade agreements,
Chile is also taking the lead in the process of
economic globalization. In addition, Chile’s capital
market has developed very quickly, providing a good
platform for corporate finance. In the past 10 years,
the market value of the capital market in Chile has increased
by 10 times, which means investors can make
the most of capital market to conduct better investment.
To investors, Chile’s forestry has become one of
great investment value. Forests accounted for 22% of
the entire land area of Chile, a unique condition for
Chile’s wood, paper and furniture. Forest area in southern
Chile accounted for 31% of the entire Chile’s forest
out of good natural conditions. According to Jin Long,
Commercial Counselor of Chile Embassy, from the industry
point of view, the price of wood within the world
of forestry costs are growing, it pays to invest in Chile
to offset rising costs.
In addition, in order to attract foreign direct
investment, Chile introduced a specialized agency,
Chilean Economic Development Board, whose main
task is responsible for facilitating the investors, helping
publicize and promoting the investment environment
in Chile. Since the establishment after more than 70
years, Chile Economic Development Board has made
tremendous efforts in providing information, service
and technical support to investors, which proved to be
of great convenience to outbound investors.
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