Chile, which is a member of NAFTA and MERCOSUR, exports copper (concentrates & cathodes), chemical wood pulp, paper, sawn timber, fishmeal, fresh and frozen fish including salmon, fresh fruit (especially table grapes, apples, pears, kiwis), wine, chemicals (methanol, sodium and potassium nitrate, boric acids, iodine), iron ore, molybdenum concentrates, ferro-molybdenum, while the main imports are crude petroleum oils, fuel, natural gas, propane, motor vehicles(passenger & goods), mobile telephones, chemical and plastic raw materials, urea, lubricants, medicaments, electric appliances and minerals.

The Council of the Central Bank is responsible for carrying out exchange control policy and has amended requirements so that exporters are allowed to change all export earnings without restriction. Payments for visible trade transactions, the official exchange market, is not permitted unless an Informe de Importacion has been issued. A form called Informe de Importacion, issued by the Central Bank, which must be obtained and processed through a local commercial bank, is required for all imports having a value of more than US$ 3 000. This certificate is for statistical reasons, but is free and normally issued on a pro forma basis. Chile uses the Harmonised Tariff Schedule (HS) to classify imports and exports.

There are two duty-free zones one in Iquique and one in Punta de Arenas. In these areas goods are exempt from tax and VAT.

Chile’s main export partners are the US 15.8%, Japan 11.1%, China 11.1%, Netherlands 5.8%, South Korea 5.5%, Brazil 4.4%, Italy 4.1%, Mexico 4.1% (2005). Commodities being exported are copper, fruit, fish products, paper and pulp, chemicals, wine.

Chile’s import partners are Argentina 14.8%, US 14.6%, Brazil 11.7%, China 7.8%, South Korea 4.8%, Yemen 4.4% (2005). Main commodities imported are petroleum and petroleum products, chemicals, electrical and telecommunications equipment, industrial machinery, vehicles, natural gas.

Chile’s form of government consists of a Presidential system, which is based on the 1980 constitution. The president, who is elected for a period of four years, is head of state and appoints the cabinet. The current head of state is Michelle Bachelet.

National legislature comprise Bicameral legislature (Congress): a Senate (the upper house) comprising 38 members elected for eight years and renewed partially every four years; and a Chamber of Deputies (the lower house), with 120 members who are all elected every four years at the same time as the president.

The 21 Supreme Court judges are appointed until retirement (compulsory at 75 years) by the president from lists of five-candidates each submitted by the Supreme Court and confirmed by a two-thirds majority in the Senate (the upper house); 16 regional courts of appeal and the members of the lower courts are appointed by the Supreme Court.vMichelle Bachelet, of the Partido Socialista (PS), heads the Concertacion coalition; she took office as president on March 11th 2006.

Main Political Organizations:

Government: Concertacion Democratica coalition (Concertacion), comprising the Partido Democrata Cristiano (PDC), the Partido Radical Social Democrata (PRSD), the Partido Socialista (PS) and the Partido por la Democracia (PPD).

Opposition: Alianza por Chile (APC, the Alianza), comprising Renovacion Nacional (RN) and the Union Democrata Independiente (UDI); Juntos Podemos, comprising the Partido Comunista (PC), the Partido Humanista (PH), and smaller radical groups.

Chile's economy is based on its rich mineral resources, on agriculture, which takes advantage of the wide variety of climatic conditions, on its rich fishing grounds, and on industry. There has been, however, much instability in the value of the most important minerals (copper, iron, nitrate) mined in Chile and their contribution to the GNP and to the country's exports. These depend largely on demand and prices in the world market and on Chile's ability to compete with other mineral-producing countries. The exploitation of Chile's mineral resources is to a large extent in the hands of foreign, mainly U.S., companies. Mining plays a dominant role in central Chile. Forestry, fishing, and mining are important in the south.

The fluctuation in the extent and value of the production of minerals has prompted the development of industry and agriculture, especially for export. Economic growth over recent years has been, on the average, 4 to 5 percent annually. Inflation has been one of the lowest in Latin America.

Chile's industry is largely based on local mineral resources, agricultural raw materials, and forestry. Industries include copper refining, nitrate products, iron smelting and steel production (in a large government-owned plant near Concepcion), oil refining, cement and various building materials, chemicals, timber and pulp, furniture and various wood products, a wide variety of food products, meat packing, fish packing and fish products, sugar, wine and beer. There is also a large textile, clothing, and leather industry. Industry is mainly concentrated in and around four main urban centers: Santiago, the largest industrial center (in which 20 percent of the local labor force is employed in industry), Valparaiso, Concepcion, and Valdivia.

Government policy encourages the establishment of new industries in sparsely inhabited regions, especially in the south. Fifteen percent of the workforce is employed in industry. The main trading partners are the United States (which takes 22p ercent of exports and provides 20 percent of imports), Japan (9 and 10 percent), Germany (10 and 8 percent), and Brazil (7 and 8 percent).

Copper accounts for 42 percent of exports, other minerals (gold, iron, nitrate, titanium, and others) approximately 20 percent, fresh fruit 10 percent, fish and fish products 7 percent, and pulp and paper 6 percent.

Stability and the country's strong economic performance have attracted large amounts of FDI. In terms of both population and GDP, Chile's stock of FDI was the highest in Latin America in 2004. Mining has attracted the most FDI since the liberalisation of investment rules in 1974, and is now 33% of the total. FDI inflows have declined steadily in recent years from the peaks recorded in the late 1990s. However, a pick-up in global economic activity has driven the strong recovery in FDI inflows since 2003." Canada is the third largest investor in Chile with US$10 billion materialized and is second in the mining sector.

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Bolsa Electonica de Chile, La Bolsa de Comercio de Santiago

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