Doing Business with Chile
|Capital||Santiago de Chile|
|Religion||Roman Catholic (67%), Protestant (15%), Judaism|
|State system||Presidential Republic|
|Head of State||Gabriel Boric|
|Head of government||Gabriel Boric|
|Currency name||Chilean Peso (CLP)|
|Time shift||-6 hours in summer, -4 hours in winter|
|Nominal GDP (billion USD)||553.7|
|Economic growth (%)||11.8|
Chile is a republic with a presidential system, and all executive power therefore rests in the hands of the president, who appoints his government. Chile is a developed country and as such is a member of the OECD · Chile is the 47th economy in the world and the 5th largest economy in the Latin American region (according to GDP value). The economy consists of 60% services, 36.7% industry including mining, 3.2% agriculture. · Within the region, it has a stable macro-economy, a low level of indebtedness and independent institutions such as the courts and the central bank. It is an open market economy with a low share of local production. The country has concluded more than 60 trade agreements providing access to markets representing almost 90% of world GDP. The largest trade partners are the PRC, USA, EU. The most important export items are mineral raw materials and agricultural products. The largest foreign investor is the EU. The impact of the pandemic: after an unprecedented GDP decline of 6% in 2020, the Chilean economy managed to recover in 2021 at a pace not seen before, with GDP growth of 11.8%. The year 2021 was an election year, so the year of drafting the new constitution. In the May elections to the Constituent Assembly, to the positions of governors, mayors and representatives, the traditional political parties of the centre-right and the left completely failed. On the contrary, independent candidates and representatives of the extreme left succeeded significantly. This year, the country awaits the completion of negotiations on the text of the new constitution and a nationwide referendum. It is assumed that the negotiations on the new constitution will bring more emphasis on the social area, the question remains whether and possibly how ownership relations, the liberal setting of the economy or the administrative organization of the country will be affected. Czech investments in Chile are directed mainly to the energy and food sectors.
Practical telephone numbers (emergency services, police, firemen, information lines, etc.)
First aid (Ambulance) – 131
Firemen (Bomberos) – 132
Police (Carabineros) – 133
Criminal Service (Policía de Investigaciones) – 134
Help for drug addicts (Fonodrogas) – 135
Maritime Rescue Service (SBRM) – 137
Air Rescue Service (SAR) – 138
Forest Fire Reporting Office (Incendios Forestales) – 130
Important web links and contacts
www.gob.cl/instituciones – Overview of contacts for ministries and other state bodies
www.gob.cl/pasoapaso – Detailed information on quarantine phases and applicable restrictions
www.bcentral.cl – Central Bank
www.sii.cl – Tax Administration
www.ine.cl – Statistical Office
www.mercadopublico.cl – Offer of public contracts
www.chilecompra.cl – Public procurement broker
www.sbif.cl – Market regulator
www.cnc.cl – National Chamber of Commerce, Services and Tourism
www.ccs.cl – Santiago Chamber of Commerce
www.sofofa.cl – Company for the support of industrial production
www.sonami.cl – National Mining Company
www.asexma.cl – Association of Exporters
www.corfo.cl – Agency for the support of economic development
www.investchile.gob.cl – InvestChile
The European Union (EU) is represented in Chile by a delegation:
Address: Av Ricardo Lyon 222 Torre Paris, 3er piso, Providencia, Santiago T
Phone: +56 2 23352450 Fax: +56 2 3351779
Email: [email protected]
Email Economic section: [email protected]
PaulSourcing: Ten Commandments for Doing Business with Chile
The PaulSourcing agency has prepared ten recommendations for doing business with Chile for Czech entrepreneurs interested in business relations with Chile. In 2020, it was supplemented with 4 current tips.
4 recommendations for entering the Chilean market during the coronavirus pandemic:
- Market research Market research should focus on finding answers to the following questions: Are similar products already sold on the market? If so, from which companies, from which countries, at what price? And further, what is the (un)success of similar products on the market? What makes your product or service interesting and differentiates you from the competition? Who is the target group for your products? What is the real size of the market for your product or service? Can you keep up with the price in the Chilean market?
- Searching for business partners Finding suitable contacts for cooperation, you can use paid databases, customs statistics, Internet search engines (the most used Google Chile), the professional social network LinkedIn, contacts to industry associations.
- Communication with business partners Practically all representatives and owners of Chilean companies currently work from home. Communication is moving to e-form. It is possible to communicate online with potential partners using the most widespread applications such as WhatsApp, Skype, LinkedIn, etc.PaulSourcing’s foreign office in Chile recommends postponing contacting and offering cooperation for the time being: in the current situation, it is more complicated than in a normal state (home office, suspension of activities, etc. ) and it is quite likely that due to the uncertainty in the market, you are more likely to encounter a premature rejection or no response at all.
- Preparation of quality materials Spend time preparing quality materials for addressing in Spanish. It is better to have translations into Chilean Spanish corrected by a native speaker before printing the materials. It is recommended to have your company’s website in Spanish as well.
Ten Ten for Trading with Chile
- “European” Chileans Chileans are the most “European” nation in Latin America. Therefore, be punctual and respect the agreed deadlines, although the other side may not always be reciprocated in the same coin.
- Prepare thoroughly for the meeting Prepare for the meeting very well with arguments, in no case do not underestimate the preparation. A number of businessmen studied in the USA, Europe or at prestigious Chilean universities, the level of which is also considered very high from an international point of view.
- Pay attention to the formal side of the meeting Do not neglect the formal side of the meeting. Above all, when making first contacts, always be perfectly groomed, in a good-looking suit, and quality cosmetics are also appreciated (for men too).
- Don’t be measured in meetings First meetings tend to be factual, but not cold. Gradually, the atmosphere relaxes and after mutual “touching” it is possible to move on to topics of a more personal nature, such as the family, which is still considered extremely important in Chile.
- Trust is important for a business relationship Building a long-term relationship and gaining the trust of a partner is the basis of business success. In any case, try to be pleasant, confident, but your demeanor must not be patronizing. Respect your customer as a full partner.
- Avoid political topics Avoid discussing the still very sensitive topic of General Pinochet’s military dictatorship and do not raise the topic yourself. Society remains very clearly divided into clear supporters of the military regime, or on the contrary, its opponents.
- A business partner’s interest in Chile will please your partner. Your partner will always be pleased by a more thorough knowledge of even just fragments of Chilean history (apart from the already mentioned dictatorship), culture, sporting achievements, natural beauty or any positive assessment of this country or its inhabitants. Chileans are a proud nation, and in many respects, very rightfully so.
- Negotiations in Spanish mean a great advantage In large companies, negotiations may take place in English, but even here it is a great advantage to use Spanish as the language of negotiation. For smaller and small companies, Spanish is a must. Likewise, promotional materials and catalogs in Spanish are much more acceptable to local partners than printed materials in English.
- Be patient Despite the “European” nature of the local traders, you need to be patient and their often polite interest cannot be overestimated. It is necessary to find the right balance between healthy pressure on the partner and inappropriate “driving him into a corner” by demanding a quick decision. Chilan always needs to think things through, and that takes time and patience on your part.
- A small gift or an invitation to the Czech Republic is the way to success A local businessman always appreciates even a small thing in negotiations, reminding the company or the country of the counterparty. If the establishment of long-term profitable cooperation is very promising, an invitation to visit the Czech Republic and your company is also appropriate. Most of the time, such a visit will help to dispel the last remaining concerns.