Exports Diversification is the Next Step for the Chilean Economy

January 9, 2016
By

(This article was first published on Reimagined Invention, and kindly contributed to R-bloggers)

Short summary

Last year, 2015, was a hard year for chilean exports. The main reasons were both external situation and commodities prices. Our exports are copper and non-copper (whose principal components are pulp wood, fruit and salmon). During recent years wines have acquired a greater importance, among other products that are on a small scale compared to commodities which are our key exports. The challenge then is to intensively work on exports diversification.

This is how our exports performed last year:

Some experts state that trade easing will be very important in forthcoming years. But, since 1990 Chile has made a considerable effort on establishing both bilateral and multilateral agreements that sum up to the fact that during 2016 we shall have 94% of out total exports with access to international markets under:

  • 25 international agreements
  • 64 connected economies
  • direct access to 65% of world’s population
  • direct access 85% of world’s GDP

Before 1990 Chile had conducted a different international strategy without connected economies but that got as result the inclusion of Chile in different international organizations such as the WTO on which Chile was a founding member.

Our economy is an open economy and our performance depends highly on international economies. Hence, my argument is that diversification should be the next step as trade facilitation is on a well-developed stage. The next tables and maps can provide strong evidence on my point.

Table of agreements after 1990

You can click of the columns headings to re-order the table in ascending or descending way.

Map of connected economies

Tree map of connected economies

Using logs it is possible to visualize where our exports are going to without ‘invisibilising’ some economies because of relative size effect. Left mouse-click to drill down, right mouse-click to move up a level.

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