2008 Charla Presentation
Upcoming SlideShare
Loading in...5
×

Like this? Share it with your network

Share
  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Be the first to comment
    Be the first to like this
No Downloads

Views

Total Views
956
On Slideshare
955
From Embeds
1
Number of Embeds
1

Actions

Shares
Downloads
3
Comments
0
Likes
0

Embeds 1

http://www.slideshare.net 1

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
    No notes for slide

Transcript

  • 1.
    • Business and Economic
    • Development in Chile
    • U.S. – Chile FTA
  • 2. AmCham Chile
    • Chilean-American Chamber of Commerce, member of the Association of American Chambers of Commerce in Latin America (AACCLA)/U.S. Chamber of Commerce
    • Mission: Promote free trade and investment between Chile and the U.S., being the effective voice of the members, and facilitating related services
    • Over 700 member companies: 46% Chilean companies, 30% U.S. companies, 24% mixed capital.
    • 18% of Chile’s GDP and 85% of U.S. investment in Chile.
    • Events, Research, Publications, Commercial Services
  • 3. Why Chile?
    • The Economy
    • Sustained economic growth
    • High domestic savings rate
    • Solid Banking System
    • Political Stability
    • Qualitative Features
    • Strong domestic financial and capital markets
    • Broad Access to international financing
    • Infrastructure, Human Capital
  • 4.  
  • 5. Chile: Economic Highlights
    • Early economic liberalization (1975) compared to the region (1980).
    • “ Chilean miracle”: Record real avg. annual growth of 8%, 1986-1997, after debt crisis in 1982. Steady GDP growth from US$ 74 billion in 2003 to US$ 120 billion in 2007
    • Doubled per-capita income / poverty cut in half during the 1990s.
    • Inflation under control: 2%-4% range from 1999 to 2007, rising in 2008
    • “ A+” Rating from Standard and Poor’s, December 2007
    • Developed nation by 2020
  • 6. GDP Growth Source: Central Bank of Chile
  • 7. Unemployment & Inflation Source: Central Bank of Chile
  • 8. Chile’s Efforts to Reduce Poverty Source: Ecuesta CASEN 2006, Mideplan
  • 9. Chile Trade Overview
    • Exports: Engine of Chilean economic growth
    • Exports represent approx. 50% of Chile´s GDP
    • Last 3 decades exceptional export growth
    • Increase in productivity & external competitiveness
    • Exporting products that 30 years ago didn´t exist:
      • Salmon, Fruit, Wine, Cellulose
    • 2007 Worldwide exports $66 Billion
    • 2007 Worldwide imports $43 Billion
  • 10. GDP based on PPP per Capita 2008
    • Source: Source: IMD, World Economic Outlook, October 2007
  • 11. Chile: Total Trade Source: Central Bank of Chile
  • 12. Chile Total Trade
    • Source: Central Bank
  • 13. Foreign Investment in Chile
    • $64.7 billion in FDI, 1974 – 2007
    • The US is the largest Investor with $16.3 billion, 25% of total FDI in Chile
    • Over 4000 companies from 64 countries have i nvestments in Chile ( 300+ U.S. companies in Chile)
    • Business Clusters in Chile: Shared services, corporate headquarters, IT development & support, call centers
    • 47+ Companies use Chile as a platform for services in the region
      • IBM, Unilever, Nestle, Zurich, GE, Falconbridge, Wachovia, Equifax, Packard Bell, Phelps Dodge, Kodak, ALICO.
  • 14. FDI in Chile by Country Source: Cinvers (Comité de Inversiones Extranjeras), Materialized Foreign Investment (D.L. 600) by Country 1974-2007
  • 15. Recent Trend of FDI in Chile Source: Cinvers
  • 16. U.S. FDI in Chile by Sector Source: Cinvers
  • 17. Materialized FDI in Chile Source: Cinvers
  • 18. Chile: Business Highlights
    • High standards of business ethics
    • Low cost of doing business
    • Business Environment Ranking: B 21 (E and 100 being most risky) (Economist Intelligence Unit)
    • Highly-skilled and reliable workforce
    • Advanced telecommunications and IT infrastructure
    • Santiago rated best combination of quality of life & business potential
    • Ranked best business center in the region
    • Economist Intelligence Unit Democracy Index rates Chile 30th out of 167 countries -- flawed democracy category
  • 19. Competitiveness Scoreboard Source: IMD, World Economic Outlook, October 2007
  • 20. Corruption Perception Index Source: www.transparency.org
  • 21. Chile: Services Market
    • Ranked highest in Latin America for connectivity and technology infrastructure
    • Ranked 33rd in Ease of Doing Business among 178 countries (down from 28 in 2007)
    • Ranked 30 th in E-Readiness (score of 6.47/10); U.S. is 2 nd (score of 8.85/10)
    • 7th for Offshoring Attractiveness(A.T. Kearney)
    • 2007/2008 Human Development Index: Ranked 40th (out of 177 countries) as a country with high human development
    • Technology & service springboard
    • Call centers, IT service centers, Biotechnology, Software Development center
  • 22. Doing Business in Chile Ranking Source: Doing Business in Chile 2008, International Finance Corporation
  • 23. Human Development Index 2007
    • Index is a compilation of:
    • Life expectancy at birth (78.3)
    • Adult literacy rate (% ages 15 and older) (95.7%)
    • Combined primary, secondary and tertiary gross enrollment ratio (82.9%)
    • GDP per capita (PPP US$12,027)
            • Source: Human Development Report 20072008
  • 24. Trade Agreements
    • Chile has 19 trade agreements with 57 countries, representing 80% of the world’s international trade; this is more than any other country
    • Free Trade Agreements: Canada, South Korea, CAFTA, China, Ecuador, EFTA (Iceland, Liechtenstein, Norway and Switzerland), USA, Mexico, Japan and Peru
    • Economic Cooperation Agreements: Bolivia, Colombia, Venezuela and MERCOSUR (Argentina, Brazil, Uruguay and Paraguay)
    • Association Agreements: European Union (27 countries), P-4 (Brunei, New Zealand, Singapore)
    • Partial Agreements: India and Cuba
    • WIP: Australia, Malaysia, Vietnam, Indonesia, South Africa and Turkey
  • 25. Chile´s Trading Partners
    • Source: Lexis Nexis
  • 26. Chile´s Trading Partners
    • Source: Lexis Nexis
  • 27. U.S.-Chile Relationship
    • The U.S. is Chile’s # 1 trading partner and foreign investor
    • Trade has reached a record high under the FTA
    • In 2007, total bilateral trade reached US$ 15.7 billion, with a positive trade balance
      • Exports to US of US$ 8.419 billion
      • Imports from the US of US$ 7.253 billion
    • More than 2,000 businesses exported to the U.S. 90% of them are micro, small and medium-sized businesses as opposed to large companies
    • In 2007, Chilean companies exported approximately 2,000 different products to the U.S.
  • 28. U.S. – Chile Trade Source: Central Bank
  • 29. U.S.-Chile Trade Development Source: Central Bank
  • 30. Chile Trade Development Source: Central Bank 132%
  • 31. The FTA
    • Tariff Reduction
      • Tariffs eliminated in a maximum period of 12 years (2015)
      • Chile - US: tariffs on 95% of products reduced to 0% immediately
      • US - Chile: Tariffs on 90% of products reduced to 0% immediately
    • Telecommunications, E-Commerce
    • Rules of origin and customs procedures defined
    • Effective dispute resolution
    • Transparency
    • Labor and Environmental Chapters
  • 32. FTA Benefits - U.S.
    • Regain competitive positioning
    • Leadership in free trade
    • Impetus towards other agreements (Peru)
    • Concrete support for countries who have succesfully applied free market economic reforms and have developed strong democratic political systems
    • Investment flows
      • Enhanced legal framework
      • Probable tax treaty
  • 33. FTA Benefits - Chile
    • New export possibilities
      • Market niches – Textiles, milk products, oils, nitrates, chemical products, pears, artichokes
      • Tariff escalation (discrimination on higher value-added goods) disappears
    • Decreased unemployment and inflation
  • 34. FTA Results
      • Expectations: Increase bilateral trade by 30% , major gains in terms of investment
      • Since 2003
      • 162% increase bilateral trade total
      • Both exports and imports show increases of over 140%
  • 35. Challenges
    • Facilitate the exportation of Services
    • More agreements to avoid double taxes
    • Better customs standards
    • Better English Skills
    • Innovation ( I & D)
    • Intellectual Property –FTA
    • Investment Rate
  • 36. Conclusion
    • Chile has a successful record of reform, growth and stability, standing out as an “island” in Latin America
    • This success is firmly rooted in trade liberalization
    • The U.S.-Chile FTA has been beneficial for the U.S. as well as Chile