Overview Of The Economy Of Chile
Chile has a mixed economy, which means that it is made up of both private and state-owned corporations. The privately-owned businesses are regulated by limited government policies. The economy of Chile is one of the most secure and productive in South America. It is ranked by the World Bank as a high-income economy. According to the Global Competitiveness Report, Chile has the most competitive economy in South America and the 30th most competitive in the world.
In 2014, its nominal gross domestic product (GDP) was $258 billion and GDP per capita was $14,047. Chile is the first Latin American country to become a member of the Organization for Economic Cooperation and Development (OECD). It has a workforce of 8.3 million and an unemployment rate of 6.9%. Of these employed individuals, 63.9% work in the services industry. This is followed by 23% in the industry sector and 13.2% in agriculture.
Leading Industries Of Chile
The leading industry of Chile is the services sector, which contributes 53.1% of the GDP. The industry sector contributes 41.8% of the GDP and the agricultural sector contributes 5.1%. The leading industry products include: copper, fish processing, iron and steel, other minerals, wood products, cement, and textiles.
Top Export Goods And Export Partners Of Chile
In 2014, exports from Chile were valued at $77.3 billion, making it the 44th largest export economy in the world. Its principal exports include: refined copper ($18 billion), copper ore ($16.6 billion), sulfate chemical woodpulp ($2.98 billion), raw copper ($2.95 billion), and fish fillets ($2.53 billion). A large percentage of its exports go to the following countries: China ($18.9 billion), the United States ($9.3 billion), Japan ($7.81 billion), South Korea ($4.86 billion), and Brazil ($4.11 billion).
Top Import Goods And Import Partners Of Chile
In 2014, the imports to Chile totaled $69.1 billion, giving this country a positive trade balance of $8.22 billion. Its major imports include: crude petroleum ($5.43 billion), refined petroleum ($5.33 billion), cars ($3.8 billion), delivery trucks ($1.94 billion), and petroleum gas ($1.8 billion). A large portion of its imports come from the following countries: China ($14.8 billion), the United States ($14 billion), Brazil ($5.31 billion), Germany ($3 billion), and Argentina ($2.85 billion).
Challenges Faced By The Economy Of Chile
Despite decreasing unemployment rates, increasing wages, and a lack of perceived corruption in government, the economy of Chile still faces some significant challenges to growth. Some economists claim that the poverty rate has not decreased as much as the government has reported. These critics claim it is hovering around 29%.
While foreign direct investment has been gradually increasing, its funds are directed at only 4 major sectors: gas, mining, water, and electricity. Additionally, the gap between the rich and the poor is constantly growing wider. For example, the richest 20% of the population earns 60% of the GDP, while the poorest 20% only earns 3.3% of the GDP. This gap makes it difficult for those at the bottom of the socio-economic scale to progress in economic stability, health, and education.
Future Economic Plans
Plans for the future of Chile’s economy include continued growth and an expansion of the tourism industry. Currently, this country receives around 3.6 million tourists every year, but it is hoping to receive between 4 and 5 million by 2018. To achieve this, the government is attempting to develop tourist activities and attractions in each of its 15 regions. Additionally, the government is creating public policy to encourage public-private partnerships to encourage private investment in the tourism industry. Additionally, inflation is expected to decrease slightly and consumer spending is expected to increase through 2017 and 2018.
What Kind of Economy Does Chile Have?
The economy of Chile, classified as a high-income economy, is one of the most developed and prosperous ones in South America. The leading industry of Chile is the services sector, which contributes 53.1% of the GDP.
About the Author
Amber is a freelance writer, English as a foreign language teacher, and Spanish-English translator. She lives with her husband and 3 cats.
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