Chile's economy is heavily reliant on international trade to sustain its economy. In 1997, exports reached US$17 billion and imports US$18.9 billion. Chile's main trading partners are the United States, Japan, Germany, and Brazil. However, Chile's export markets are geographically diverse, spanning Asia, the European Union, the United States, and Latin America. Latin America has been the fastest growing export market for Chile. Since 1991, Chile has signed free-trade agreements with Canada, Mexico, Venezuela, Colombia, and Ecuador. An associate agreement with MERCOSUR went into effect in October 1996.
Chilean exports have traditionally been dependant on copper and have been consumed mostly by industrialized countries. However, non-mineral exports have grown faster than those of copper and other minerals in recent years. In 1975, non-mineral exports were about 30 percent of total exports; by 1997 they accounted for 52 percent of export earnings. The most important of these non-mineral exports are forestry and wood products, fresh and processed fruit, fishmeal and seafood, and other manufactured products.
|Trade (expressed in billions of US$): Chile|
|SOURCE: International Monetary Fund. International Financial Statistics Yearbook 1999.|
According to the latest statistics, Chile has 4 main markets of destination for its exports. First, Asia accounts for about one-third of total exports. Chile's principal Asian partner is Japan, although trade with the People's Republic of China, the Philippines, and Hong Kong is increasing. Trade with the European Union accounts for a quarter of overall trade, with the United Kingdom (5.8 percent) and Germany (4.8 percent) as the leading partners. With respect to Latin America, there has been a marked increase in exports to Brazil and Argentina. Their share in overall exports in 1997 was 6.1 percent and 4.6 percent respectively. The United States remained Chile's most important partner. In 1997 it accounted for 16.7 percent of Chile's total world exports.
Chile's imports originate mainly in the North American Free Trade Agreement (NAFTA) countries—the United States, Mexico, and Canada. Together, imports from these countries constituted 30.5 percent of all imports for 1997. In the same year, Latin America accounted for 26.5 percent, the European Union was at 19.8 percent, and Asia comprised 15.5 percent of imports. More specifically, by country, in 1997, Chile imported 23.1 percent from the United States, 9.2 percent from Argentina, and 6 percent from Brazil.
Chile is a party to bilateral trade agreements with Bolivia, Colombia, Canada, Cuba, Ecuador, Mexico, Peru, and Venezuela. Chile is also a member of the Asian Pacific Economic Cooperation (APEC). Currently, Chile is negotiating trade agreements with Central America (Costa Rica, El Salvador, Guatemala, Honduras, and Nicaragua) and plans to initiate negotiations with the European Union, New Zealand, Japan, and other countries. The current trade agreements have had a positive impact on international trade for Chile and are predicted to do so in the future. Past negotiations to obtain a free trade agreement between Chile and the North American Free Trade Association were unsuccessful. However, the current Summit of the Americas negotiations are intended to create a free trade zone from North America to Argentina.