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#ChileCOA Recap: The Path to a Diversified Economy

Chilean Finance Minister Felipe Larraín

Chilean Finance Minister Felipe Larraín. (Image: Jesus Inostroza)

May 31, 2019


For a complete list of speakers, see the 2019 #ChileCOA event page.

Watch videos of all the #ChileCOA presentations.

Lea este resumen en español.


Opening AS/COA’s 2019 LACC Santiago conference, AS/COA CEO and President Susan Segal spoke of the optimism international investors feel regarding Chile, noting the country’s solid institutions and a favorable investment climate for more than three decades. Segal highlighted the opportunity Chile has for expanded regional leadership in 2019 through its chairing of APEC and COP 25 later in the year.

Next up, in a keynote address, Minister of Finance Felipe Larraín spoke about the path toward a diversified economy for Chile. He noted how, in less than 20 years, Chile has reduced its reliance on the mining sector, which in 2000 was the largest contributor to Chile’s GDP but by 2018 had fallen to fifth, with the business and finance sector taking over the top spot. He also highlighted how over half of all of Chile’s exports go to Asia, including a third to China alone. Meanwhile, just 15 percent go to Latin America, and 14 percent to each the EU and the United States. Larraín gave examples of leading exports such as cherries to China and apples to Vietnam, and the significance deepening trade ties through trade groups like the revamped Trans-Pacific Partnership, now known as the CPTPP, and the Pacific Alliance.

Chile has a good track record of public policies, and relaxed regulations can open up investment even more, said experts on the first panel of the morning, which was moderated by Bloomberg’s Philip Sanders. Chile is without a doubt the most competitive country in Latin America, said Scotiabank’s Stephen Guthrie. As one example of how the country’s market has grown in the last 15 to 20 years, Guthrie noted that in 2000, no Chilean bank had a market capitalization of over $1 billion. Today, there are three such banks. Going further on access to banking services, Mercado Pago’s Matías Spagui said that many Chileans remain under-banked, but that, thanks to technology, financial inclusion in the country could see “exponential” growth. Cerro Dominador CEO Fernando González said some regulatory changes are necessary and encouraged policymakers to “avoid easy solutions and focus on building open, competitive markets.” Google’s Eleonora Rabinovich commended Chile for having a good track record of “innovative and balanced” public policies, especially regarding Internet regulation. “As a company, we are confident that Chile will keep going on this path,” she said.

In “The Road to APEC,” the second panel of the day, Vice Minister of Trade Rodrigo Yáñez covered Chile’s important role as this year’s host for the 21-member economic bloc in a global environment of heightened trade tensions and after leaders at last year’s summit in Papua New Guinea failed to come to agreement to produce a joint communique. Yáñez pointed to positive signs of consensus already made, given that trade ministers at a May meeting in Viña del Mar came together to release a declaration advocating for sustainable, inclusive growth. Overall, panelists covered how technology and disruption play a role to that end in Chile and beyond. “My main interest is not just to participate in a cocktail party,” said Celulosa Arauco y Constitución’s Charles Kimber when speaking about his engagement in APEC. “How do we take [business ideas and lessons learned] to other parts of the country?” SMEC’s George Lasek applauded Yáñez’s emphasis on diversification, adding that it’s understood in his firm that, while Chile dominates in the area of copper, one can’t put all one’s eggs in one basket. Lasek, who has only been based in the country for two months, also praised Chile’s development and called it the Switzerland of Latin America. Moderator and head of the APEC CEO Summit Andrés Varas closed by echoing an important message from the panelists, that “we need to co-create our future.”