Q: Do you have any specific measures to attract foreign investment?
A: We are planning specific measures to attract foreign investment. These include, for example, a tax credit for projects with a clear green focus. This is one example of the plan, which has 28 measures. It is really a broad plan to try to address all steps of an investment, from the first phase of elaborating a project, through environmental evaluation, to financing and delivery. We have envisioned measures to accelerate the process of investment in each of these steps.
We are going to have a forum for foreign investment in Chile later in December where the president of Chile will meet with a number of foreign companies.
Q: Which sectors will be the main drivers of growth in the country?
A: The mining sector is still going to be relevant in the future as Chile produces minerals such as lithium and cobalt, which are critical in addressing the climate change challenge. So this is not just something that is good for Chile, it’s also good for the world.
It is also relevant to mention a dynamic sector like renewables, which is relevant for climate change too. In particular, in the last 10 years, green hydrogen has been expanding. Energy is becoming as relevant as the mining sector in terms of investment. So I would say that these two sectors are the drivers of investment and growth in Chile.
Energy is becoming as relevant as the mining sector in terms of investment
It is clear from all our meetings in Europe that there is interest in the renewable energy sector in Chile. The development of the green hydrogen industry requires a number of actions, from the development of infrastructure to discussions on how to give access to the land where the energy is going to be produced.
Q: Mining accounts for around 50% of exports in Chile. Do you think this dependence on a single sector could be a weakness?
A: Well, I would say two things. First, Chile has, over the years, developed different ways to attenuate the impact of the fluctuation of prices and protect its budget expenditure from these fluctuations. Second, our challenge is to develop more industrialisation around the mining sector. This year, the budget for science, technology, innovation and knowledge in Chile is going to increase by about 13% and a part of the new funds will support the diversification of our production.
Q: What makes Chile interesting for foreign investors?
A: Chile has strong institutions, very good geographic conditions and a solid regulatory framework. And we also have some good policies designed by previous governments, for example with regard to renewable energy. I think this is something that the private sector recognises, despite, as we know, that now is not the best economic moment in history.
Q: What growth rate do you expect in the coming years?
A: This year we expect a 2% growth rate. It will be either zero or even negative the following year. Chile grew about 12% in 2021, one of the highest growth rates in the world. But that growth was driven by consumption and was not sustainable as it created inflation. So these next years will follow a process of normalisation.
But if we then look at 2024, the prediction is about 3%, which is a more structural growth rate for the country. But 3% is not enough in our view. That's why we're investing a lot to increase productivity while also facing climate change. This is our big challenge in Chile. And this is my main concern as the minister of economy: how we get more economic dynamism while supporting a fast transition to a greener economy.
