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It has never been more important for you to understand
what is occurring in the world beyond your country’s
borders. Whether you realize it or not, we are now all
fellow citizens…Global Citizens.
The Thomas White organization was founded in 1992
with the goal of bringing the benefits of globalization to
investors around the world. We believed that once
investors understood that globalization was a positive
force, they would also see the advantages of adding
international equities to their portfolios. It only makes
common sense that professional investors would begin
searching the globe for the most attractive opportunities.
Researching a wider universe of companies should
improve long-term performance. Moreover, broad
diversification typically lowers return volatility.
Multinational corporations have been using this global
strategy for years; why shouldn’t investors do the same?
Now 15 years later, our firm growth and strong
subsequent portfolio performance has confirmed our
investment premise. Currently, Thomas White
professionals are performing research and managing
over one billion dollars in close to 50 countries. We
believe one reason for our success is that the
nationalities of these analysts are as globally diverse as
our portfolios.
www.thomaswhite.com
Chile: Like Fine Wine and Burnished Copper
hen Isabel Allende, Chile's most
famous literary export, writes
about her spindle-shaped country
as a “land of mystery and
magic,” it is easy to believe her.
Chile has the driest desert in the world along
with enormous glaciers, fjords, beaches,
volcanoes, as well as spouting geysers. It is
also one of the slimmest countries in the world
— 2650 miles long and just 221 miles wide at
its widest point. Indeed, this unique
geographical shape has inspired many a poet to
call it ‘the slender lady.’ Imposing natural
barriers mark the nation’s boundaries — the
Atacama Desert separates the country from
Peru in the north, the Andes Mountains create
a frontier with Bolivia and Argentina to the
east, and the chilly waters of the Drake Sea
point to Chile’s proximity with Antarctica in
the south. The expanse of the Pacific Ocean to
the west completes the country’s geographic
diversity.
A land of spectacular beauty, Chile today is on
the threshold of a brave new emergence, having moved away from the excesses of the dark days
of dictatorship. Thanks to far-reaching social changes and economic expansion, as well as an
abundance of natural resources, the country is already considered an emerging leader in the
region and is looking to play a greater role on the world stage.
Early beginnings
Chile’s geographical peculiarities and remoteness are a matter of pride and identification for its
people. The very word ‘Chile’ is said to be derived from the native Aymará word ‘chilli’
meaning “the land where the earth ends,” and this sense of physical isolation is often glorified in
popular legends. A famous legend goes that in the beginning of time, God created the world and
when he was finished, he had some leftover pieces. He had some rivers, valleys, glaciers, deserts
W
The grand monolithic statues on Easter Island in
the Pacific Ocean are believed to have been
sculpted as a tribute to Chile’s earliest settlers.
Spanish invaders subjugated native inhabitants in
the 16th
Century and laid the foundation of
modern-day Chile.
www.thomaswhite.com 4
and mountains. Instead of letting them all go to waste, God put them all together and cast them to
the most remote corner of the earth, and thus Chile was born!
Many Chileans today refer to their
country as ‘the end of the world’ but it
is a world where, if certain hard-to-
confirm evidences are to be believed,
human habitation dates as far back as
33,000 years. But officially, the oldest
inhabited site in the Americas is located
at the Monte Verde site in Chile, where
a 12,500-year-old child’s footprint left
behind in a marshy field was discovered
in 1998.
Chile’s most famous earliest culture is
that of the nomadic Chinchorros who
lived in Northern Chile between 5000
BC and 3000 BC and who left behind
the world’s oldest-known mummies.
Another important civilization was the
Atacameño culture, which flourished in
Northern Chile between 2000 BC and
1000 BC. This civilization too left
remarkably well-preserved mummies.
The Incas had a short period of rule in
Northern Chile but their invasions were
fiercely resisted by the southern
Picunches and Mapuches, tribal groups
that inhabited what are now the regions
in north and south-central Chile,
respectively. But it was the Spaniards who invaded Chile in the real sense of the word.
The march of the Spaniards
The Spanish invasion in the mid 16th century changed the course of history in Chile, and indeed
of many parts of South America. Though relatively few in number, the invaders from Western
Europe were ruthless and determined, and they subdued Chileans by a combination of
exploitation and the threat of warfare. Thus, the all-conquering Spaniards established Santiago,
the current capital of Chile, in 1541. However, barely six months after the city was founded, the
Mapuches, or Araucanians as the Spanish called them, struck and razed almost the entire
Chile and the World
Nominal GDP ($) 169.5 billion
GDP Rank 46/191
Per Capita GNI ($) 13,250
Per Capita GNI Rank 82/210
Population Rank 60/227
Geographical Area Rank 38/249
Global Competitiveness
Rank
30/133
Economic Freedom Index
Rank
10/179
Human Development
Index Rank
44/182
Major Industries
Copper mining, other
mining (gold, silver, iron
ore, molybdenum,
nitrates), wood and wood
products, fish and
fishmeal, fruits and wine
www.thomaswhite.com 5
settlement. The Spaniards, though, clung on and by 1553, many more settlements had sprung up
and the foundation for a new society had been laid. Gradually, the Spaniards attained supreme
dominance in Central Chile and established a strict system of control in Northern Chile (then in
Peru).
Eventually, children of mixed parentage began to outnumber the indigenous people, who reduced
in numbers rapidly because of large-scale epidemics and warfare. Gradually, there emerged a
Chilean creole class — the Mestizos or people of partly white ancestry — who sowed the first
seeds of the fight for independence from Spain. On September 18, 1810, at a town meeting in
Santiago, Chile took a tentative step towards independence when a group of locally elected
leaders replaced the governor appointed by the Spanish. Therefore, September 18 is celebrated as
the Chilean National Day.
Freedom!
The cry for independence from Spain grew louder
across South America by the 1820s. Jose de San
Martin, one of the great heroes of Argentina’s war of
independence from Spanish rule, marched into Chile
and occupied Santiago. A curious trivia is that,
Bernardo O’ Higgins, the illegitimate son of an
Irishman who had served the Spaniards as the Viceroy
of Peru, was appointed as the second-in-command of
Jose de San Martin’s forces and it was O’Higgins who
later became the supreme director of the new Republic
of Chile. A declaration of independence was officially
issued by Chile on February 12, 1818 and formally
recognized by Spain in 1844. Under O’Higgins, Chile
gradually began to achieve political and economic
stability.
A major fillip to Chile’s fortunes came from the spoils
of the War of the Pacific (1879-84) during which time
the country annexed vast copper- and nitrate-rich areas
from Peru and Bolivia. Soon after that war, a global
nitrate boom brought prosperity to the country, and an
efficient railroad system further fueled the economy.
This victory is still celebrated with great fervor by Chileans. Even today, copper is the
cornerstone of the Chilean economy.
The Santiago Stock Exchange, which
has been in business for over a
century now, perhaps best exemplifies
Chile’s resilience.
www.thomaswhite.com 6
O’Higgins dominated Chilean politics in the years after independence but the landowning elite
who first supported him later objected to his rule due to higher taxes. He was replaced by a de
facto dictator Diego Portales whose Constitution, which centralized power in Santiago and
introduced indirect elections to the presidency, lasted until the early 20th Century.
In the early decades of the 20th century, Chile’s economy suffered a near-collapse as the demand
for mineral nitrates fell. What’s more, a dictatorial general called Carlos Ibáñez del Campo held
power for a few years, and during his rule, Chile’s economic woes increased. The Great
Depression worsened the situation and the country plunged into a period of widespread
opposition and riots until World War II came as a godsend. The war boosted the demand for
Chilean copper and the country’s economy quickly recovered. In the subsequent years, Chilean
politics grew increasingly polarized, complicated and confrontational.
In 1970, Chile saw one of its most fiercely fought elections, which resulted in socialist leader
Salvador Allende becoming the world's first democratically elected Marxist president. But the
country was far from being peaceful. In 1972, what began as a truckers’ strike led to
unimaginable consequences. Faced with the prospect of losing power, Allende invited the army
commander, General Carlos Prats, to join the Cabinet. But the crisis ballooned into an
unsuccessful military coup in 1973, ultimately leading to the resignation of General Prats and the
appointment of Augusto Pinochet Ugarte, then an obscure General, as army commander.
Caravan of death
In September 1973, Pinochet unleashed a brutal coup d’état during which numerous Allende
sympathizers were rumored to have been herded into the Santiago National Stadium to be
beaten, tortured and executed. Hundreds went into exile. Pinochet appointed himself president in
1974, and thus began Chile's darkest days of widespread repression, torture, and murder. He is
believed to have organized a ‘caravan of death,’ a military group that travelled from town to
town, city to city, ruthlessly hunting down political opponents, even those who had surrendered.
Thousands ‘disappeared’ during this reign of terror. In 1980, Pinochet organized a controversial
plebiscite, which approved a new constitution and proclaimed him president for an eight-year
term.
Return of democracy
In the early 80s, cracks appeared in Pinochet’s dictatorship and murmurs about democracy began
to get louder. Eventually, in 1988, a much-weakened Pinochet held a plebiscite seeking a second
eight-year term as President. He lost. In December next year, democracy returned to the battered
country when Patricio Aylwin, the coalition candidate of a group of opposition parties who
called themselves the Concertación para la Democracia, defeated Pinochet’s protégé Hernán
Büchi for the post of president.
www.thomaswhite.com 7
Slowly, Aylwin consolidated the re-born democracy,
although there was a constant struggle between the ruling
government and the actual Constitution that still
accorded the military considerable powers.
Over the next two decades, the center-left Concertación
managed to win successive elections, holding power for
four consecutive terms. Two important political events
took place in these twenty years. In 2005, Chile carried
out constitutional reforms on 58 grounds, with one of the
key changes being the reduction of the presidential term
from six years to four years. Secondly, in 2006, Socialist
Party leader Michelle Bachelet, a Concertación nominee,
won the presidential elections to become Chile's first
woman President. Bachelet governed until early 2010
when the center-right Coalition for Change’s Sebestian
Pinera, a well-known businessman who owns a TV
station, a football team and a 25 per cent stake in the
Chilean national airlines LAN, was elected president.
One of the salutary effects of the Pinochet regime was its
pro-market agenda. The dictator started reforming the
economy and gradually pushed Chile toward a free
market system. Fortunately, the four democratically
elected presidents of the Concertación coalition who followed Pinochet did not completely
abandon the dictator’s legacy. Just as the Pinochet regime had sold many state-owned firms, the
subsequent democratic governments continued privatization, albeit at a slower pace. They also
consistently retained some of the sound economic policies that were implemented in the 80s.
With newfound economic and political stability, the Chile of today is very different from what it
was during Pinochet’s rule. The country is ranked among the forty most developed countries, its
economy is robust, healthcare has improved, life expectancy is up and poverty has been halved.
Socially as well, Chile is embracing modernity and casting off old biases. Despite its many
achievements, though, the country has a long way to go in terms of reducing economic inequality
and tackling tensions, which keep sparking between the State and the people of the indigenous
Mapuche community.
Incidentally, whites or people of pure European descent and the Mestizos or people of partly
white ancestry together make up 95% of Chile’s population of 17 million. The country’s
indigenous inhabitants, of whom 80% are Mapuches, account for the remaining 5% of the
population.
Containers ready to be shipped at a
Chilean port. Chile boasts of a free
trade policy that gives its access to
numerous markets across the globe.
www.thomaswhite.com 8
The joy of ‘18’
Having suffered and endured ruthless invaders and dictators throughout history, Chileans view
themselves as a brave and resilient society. The biggest day of riotous celebration in the Chilean
calendar is also linked with national identity. The ‘18’ as the Chileans call it, is celebrated on the
Chilean National Day — September 18 — with great joy and fervor. It is the day Chileans go out
on the street to make merry, sing and dance the Cueca, the national dance, and eat empanadas
(meat pastries) by the dozen. And of course, gulp down bottles and bottles of Chilean red wine.
On the ‘18,’ many dress up as the typical Chilean cowboy Huaso, a symbolic figure who wears a
wide flat-topped hat, multi-hued ponchos and shiny high-heeled boots with spurs. In fact, the
festivities begin a week earlier, with many fiestas patrias (patriotic parties) held during the week.
These celebrations include colorful cowboy parades, lots of folk music and dance, and not to
forget, traditional Chilean delicacies. A major part of the celebration takes place in public
gatherings in Ramadas, which are temporary shacks with roofs made from tree branches. These
Ramadas usually have a dance floor, rhythmic music and tables to eat. Typical Chilean fare such
as empanadas and anticuchos and drinks like chichas and piscos (fermented apple brew and
grape brandy) are served in these shacks.
‘Once’ upon a time in the afternoon…
Like in most ancient cultures, food is accorded special respect in Chile. Chilean cuisine too is a
mesh of its Indian and Spanish influences and speaks for the unique sense of cultural
homogeneity that Chileans are justifiably proud of. The national dish Porotos Granados is a
delicious mixture of locally produced corn, squash and beans with a dash of the Spanish in the
sprinkling of onion and garlic. Another popular national delicacy is the caldillo de congrio, a
soup made of conger eel, tomatoes,
potatoes and a melody of herbs and
spices.
Traditionally, Chileans eat four times a
day, with a unique meal called “once”
usually eaten between 4 p.m. and 7
p.m. Once is a light meal typically
consisting of sandwiches with cheese
and avocados accompanied by tea or
coffee. A cheeky tale recounts that
long ago, men wanted to drink their
liquor during the day and once was
created to give them the liberty to do
so. According to Chilean lore, it is
Young Chileans dancing the Cueca, their country’s
national dance.
www.thomaswhite.com 9
pointed out that the word liquor in Spanish is aguardiente and the number of letters in
aguardiente is eleven, which translates to once in Spanish!
Interestingly, Chilean Spanish is slightly different from the Spanish spoken in other Latin
American countries and has a distinct ‘melody’ to it. And that melody is representative of
everything about Chile – a place where contrasting cultures, geography and peoples have all
fused harmoniously to create a sense of magic.
Exemplary economy
Chile is a textbook example of how nations can adopt the right mix of policies to create an
efficient economic structure. Thanks to its free-trade policy, the country is today one of the
world’s most open economies, successive budget surpluses have reduced the national debt to
zero, and fiscal responsibility is mandated by law. Further, the country boasts of a privatized
pensions system, guaranteed minimum income for the elderly, an effective anti-poverty
campaign, and a public health provision. Chile was also the first country in Latin America to
privatize state enterprises, reduce tariffs, and allow foreign capital.
No wonder the world marvels at the extraordinary economic and social progress Chile has made
over the past two decades. In 1990, about 40% of Chileans lived below the poverty line. Today,
that number has shrunk to 12% or 13%. The number of young people going to universities has
risen from 10% to 40% during these twenty years. When Pinochet’s dictatorship ended in 1989,
two-fifths of Chile’s expenses were incurred to pay off debt. Now the country has no debt to
service and social programs account for 70% of its expenses. It is for reasons such as these that
Chile is now widely considered one of the world’s most stable emerging market economies.
Chile’s economy revolves around commerce and mineral resources, besides agriculture. About
15% of the country’s population is employed in the agricultural sector. The Vale of Chile, the
heart of the country with the highest population density and the greatest agricultural and
industrial output, is the nation’s agricultural hub. The area’s vineyards are the primary suppliers
to Chile's flourishing wine industry. Besides grapes, apples, pears, peaches, beans, onions, garlic,
oats, wheat, corn, and asparagus are grown in the region. Some of the other important economic
activities in Chile include fishing, lumbering, beef and poultry production, and sheep rearing.
Commerce the mainstay
One of the main pillars of Chile’s economy is its free trade policy. The country has free trade
agreements with developed nations such as the U.S., Japan, Australia and Canada, as well as
emerging powers like China, Mexico, and South Korea. Chile also has an economic association
agreement with the European Union and other forms of trade associations with India, Cuba, and
various South American countries.
www.thomaswhite.com 10
Further, the country recently joined the Organization for Economic Co-operation and
Development (OECD), the first South American country to do so. These networks provide Chile
access to billions of consumers worldwide. Exports account for nearly 40% of Chile’s GDP and
have been growing at the rate of 4% a year since 1999. Copper makes up 56% of Chile’s total
exports, while industrial goods contribute 26%, fish and fish-meal comprise 9%, and agricultural
products around 6%. Wine is another substantial export from the country.
A third of the world’s copper in its
belly
Copper has been the main export of Chile
for close to two centuries now. This is
understandable, given the size of Chile’s
copper reserves. The country possesses
approximately 34% of the world’s copper.
Consequently, Chile is not only the world’s
largest producer of copper but also has the
globe’s largest open-pit copper mine,
Chuquicamata, and the largest copper
mining company, Codelco.
With approximately 200 years of copper
reserves, Codelco produces a fifth of the
world’s copper ore every year. The state-
owned company’s primary output is 99.99%
pure copper cathodes. Codelco is also the world’s largest producer of rhenium and second-largest
producer of molybdenum, both byproducts of copper mining.
A big fish in the fisheries industry
An extraordinary confluence of factors has gifted Chile a large and flourishing fisheries industry.
Owing to its low temperatures and the Antarctic current to its south, Chile has the purest and
most oxygenated marine waters in the world, an environment where 1,016 species of fish thrive,
including the renowned Chilean Sea Bass. As well, over the past fifty years, the country’s
fisheries exports have been growing largely due to the development of the fishmeal industry.
Frozen seafood products make up nearly 45% of Chile’s fisheries-related exports. The country is
also a large exporter of fishmeal, fresh refrigerated products, fish oil, canned products, and dried
algae. Chile sends its fish products to 93 countries, but only nine account for 81.8% of total fish
exports. Among these nine countries, Japan, the United States, and China are some of the biggest
importers. Chile accounts for around 4% of the world's total exports of fish products.
Possessing approximately 34% of the world’s copper,
Chile is not only the world’s largest producer of copper
but also has the globe’s largest open-pit copper mine,
Chuquicamata, Copper makes up 56% of Chile’s total
exports.
www.thomaswhite.com 11
Bottled history
Wine aficionados tend to think it is only in the past 20 years or so that Chile has been competing
in the worldwide wine market but the truth is, the country has an astonishingly long and
fascinating wine history. Chile has been producing wine since the mid 16th Century when the
Spanish settlers first brought French vines with them. By a quirk of fate, Chilean wine makers of
the 19th Century became highly prosperous, not because of the wine, but because of a small
insect!
In the late 1800s, European vineyards were attacked by the aphid phylloxera, an insect which
devastated large swathes of thriving grapes. Curiously, Chilean vines remained completely
unaffected, possibly because of the country’s geographical isolation or because the settlers had
brought in unaffected French vines. Chile’s soil and climate too may have helped. From then
onwards, the Chilean wine industry continued to thrive until World War II put the cork on
exports to Europe. The poor economy at home didn’t help matters and production stagnated.
Democracy came as a blessing to the vineyards in the 1990s and the global liquor market again
raised a toast to Chilean wines. Today, Chile’s wine industry has clocked annual sales of about
$1.3 billion and the country is the fourth leading exporter of wine to the U.S. after Italy, France,
and Australia.
Energy-challenged
Chile has an acute energy shortage and, for decades now, one of its most crucial challenges has
been to generate and procure adequate energy for its power-intensive mines, industries and
households.
The country seemingly found the solution to its energy problem in 1995 when neighbor
Argentina promised an assured supply of natural gas from its vast reserves. Chile promptly
constructed gas pipelines and its firms invested in infrastructure to retool their production
facilities to utilize natural gas. By 2003, more than half of the electric energy Chile consumed
was generated by electrical power plants fed by natural gas from Argentina. Chile had come to
depend heavily on its neighbor and this was asking for trouble.
In 2004, Argentina suddenly changed its energy policy, deciding to give priority to domestic
consumers rather than exports. Since then, Argentina’s natural gas supply to Chile has shrunk
drastically and Chile’s electrical power plants have been forced to rely on more expensive diesel.
The setback, though, has had a bright side. Chile’s government has been desperately trying to
find a more lasting solution to its energy woes. In order to diversify its energy sources, the
government opened a $1 billion LNG re-gasification plant in 2009. More importantly, the
country is finally making an effort to leverage its vast geothermal resources.
www.thomaswhite.com 12
Geysers to power future growth
Chile has perhaps the world’s largest untapped
geothermal energy potential thanks to its numerous
geysers and steam fields in the north, close to the border
with Bolivia and Argentina. Therefore, experts estimate
that the country has the ability to generate as much as
16,000 megawatts of electricity using geothermal power.
Since Chile’s current power scarcity is about 7,000
megawatts, the geothermal capacity is sufficient to wipe
out the shortage and leave some power for exports. And
yet, Chile today produces less than 10 megawatts of
energy from geothermal sources.
Fortunately, having learned a painful lesson for failing to
harness its energy resources, the government is beginning
to act. As a first step, the Chilean Ministry of Mines has
been positioning the country as an attractive destination
for international geothermal investment.
Thanks to these efforts, the government successfully
completed the bidding process for geothermal exploration
concessions in early 2010. It has allocated seventeen
geothermal areas to nine companies, which are then
expected to invest $106 million over the next two years. Seven of those companies are foreign-
based.
Recession: A speed bump
Not surprisingly, the prospects of Chile’s economy have always been closely linked to the global
demand for copper. For instance, in the period between 2003 and 2007, Chile recorded strong
annual GDP growth on the back of high copper prices across the globe. In contrast, when copper
prices halved at the peak of the global financial crisis in late 2008, Chile saw a dramatic fall in its
exports.
As economic activity continued to weaken through the first half of 2009, Chile’s government
responded quickly with a $4 billion stimulus program and monetary measures, which have since
been applauded widely. While the central bank slashed interest rates by a total of nearly 8
percentage points, the government drew from the reserves set aside during the period of high
metal prices and increased spending on public projects and infrastructure to keep domestic
demand propped up. A considerable recovery in copper prices also helped, and Chile managed to
Steam fields such as this one in
northern Chile, have the potential to
generate a total of 16,000
megawatts of power every year.
www.thomaswhite.com 13
Located on the boundary of two converging tectonic
plates, Chile is prone to frequent earthquakes. The
1960 earthquake near the Chilean city of Valdivia was
the strongest ever measured anywhere in the world
while the February 2010 disaster was one of the most
powerful in a decade.
limit the damage to a GDP contraction of 1.9% in 2009. However, Chilean exports declined 20%
during 2009 compared to 2008, primarily due to the fall in the global demand for copper and
other metals.
Nevertheless, in the beginning of 2010, the outlook for Chile’s economy improved substantially.
On the back of aggressive inventory restocking by businesses around the world, the demand for
copper and other metals had grown consistently throughout the second half of 2009 and a major
part of the decline in copper prices had reversed. The world community saw Chile as one of
those countries that had recovered strongly from the recession. Chile’s GDP growth was pegged
at 4-5% for 2010. However, just as the Latin American powerhouse was bracing for a return to
its pre-recession momentum, the ground slipped beneath its feet.
Shaken…
The 8.8-magnitude quake that struck
Chile in late February 2010 not only
affected one-eighth of Chile’s
population but also dented the country’s
fragile recovery. Chile lies in the
‘Pacific Ring of Fire,’ one of the
world’s most seismically active zones,
and has suffered several massive
earthquakes in the past. But this was by
far one of the worst — the last quake of
similar force occurred in 1960.
According to government estimates, the
calamity destroyed property worth $30
billion, roughly a sixth of Chile’s GDP.
The new government has responded by
announcing an $8.4 billion
reconstruction plan. It intends to raise at
least $3 billion by increasing taxes and
the remaining $5.4 billion will be garnered from Chile’s $11 billion offshore sovereign fund —
created from windfall copper revenues — bond issues, and public expenditure cuts. Around $8
billion of insurance payments from abroad will also help the rebuilding effort. Further,
reconstruction activity is expected to create large-scale employment and aid GDP growth.
…but standing firm
Though the cost of reconstruction is massive and will hobble Chile’s growth for some time,
Chileans can take heart from the fact that, for a variety of reasons, the quake has done much less
www.thomaswhite.com
damage than it had the potential to do. For instance, the earthquake that reduced Haiti to rubble
in January 2010 was hundreds of times much less powerful than the Chilean quake. Yet an
estimated 200,000 people perished in Haiti while Chile’s death toll was approximately 500.
Further, much fewer people were rendered homeless in Chile than was initially thought because
the country, being in a seismic zone, has strict building codes.
It was providence too that the epicenter of the quake lay to the south of densely populated
Santiago and much deeper down in the earth than in Haiti. This ensured that human and property
losses were much less severe. Moreover, Chile’s copper mines, which are located to the north
Santiago, were relatively unaffected, although the forestry and wine industries suffered some
damage. In fact, Codelco was able to resume operations only two days after the quake.
The future is now
Santiago, where the regional offices of
several multinational corporations are
located, is one of the leading financial
centers of South America. A skyscraper
under construction in the city’s financial
district, when completed, will be tallest
building on the continent.
damage than it had the potential to do. For instance, the earthquake that reduced Haiti to rubble
in January 2010 was hundreds of times much less powerful than the Chilean quake. Yet an
eople perished in Haiti while Chile’s death toll was approximately 500.
Further, much fewer people were rendered homeless in Chile than was initially thought because
the country, being in a seismic zone, has strict building codes.
at the epicenter of the quake lay to the south of densely populated
Santiago and much deeper down in the earth than in Haiti. This ensured that human and property
losses were much less severe. Moreover, Chile’s copper mines, which are located to the north
Santiago, were relatively unaffected, although the forestry and wine industries suffered some
damage. In fact, Codelco was able to resume operations only two days after the quake.
Clearly the quake has caused a few cracks in the
brickwork of Chile’s economy, but strength remains in
the foundation — the foundation the leaders and
citizens of Chile have been building assiduously
strong economic future. The recession notwithstanding,
the world is in the middle of a commodity super cycle.
Billions of people across the developing world are
taking the leap from the poverty line to
and from the middle class to the affluent class. That
translates to better, bigger and more houses, as well as
more automobiles, appliances, computers, lights,
televisions, telephones and everything else that uses
copper, a commodity Chile has plenty of.
Further, as its quick recovery from the recession and the
earthquake’s devastation demonstrate, Chile has an
economic structure resilient, potent and flexible enough
to withstand adversity. In addition, the nation has a
stable political system, fiscal strength, a qualified
workforce, social safety nets to boost consumption, as
well as globally competitive industries. The icing on
cake is that the energy situation seems to be improving.
Perhaps, the future Chile has been preparing for is
beginning now.
Santiago, where the regional offices of
several multinational corporations are
located, is one of the leading financial
centers of South America. A skyscraper
financial
will be tallest
14
damage than it had the potential to do. For instance, the earthquake that reduced Haiti to rubble
in January 2010 was hundreds of times much less powerful than the Chilean quake. Yet an
eople perished in Haiti while Chile’s death toll was approximately 500.
Further, much fewer people were rendered homeless in Chile than was initially thought because
at the epicenter of the quake lay to the south of densely populated
Santiago and much deeper down in the earth than in Haiti. This ensured that human and property
losses were much less severe. Moreover, Chile’s copper mines, which are located to the north of
Santiago, were relatively unaffected, although the forestry and wine industries suffered some
damage. In fact, Codelco was able to resume operations only two days after the quake.
Clearly the quake has caused a few cracks in the
brickwork of Chile’s economy, but strength remains in
leaders and
have been building assiduously for a
ion notwithstanding,
the world is in the middle of a commodity super cycle.
Billions of people across the developing world are
the middle class
affluent class. That
translates to better, bigger and more houses, as well as
more automobiles, appliances, computers, lights,
televisions, telephones and everything else that uses
copper, a commodity Chile has plenty of.
rom the recession and the
earthquake’s devastation demonstrate, Chile has an
economic structure resilient, potent and flexible enough
to withstand adversity. In addition, the nation has a
stable political system, fiscal strength, a qualified
ial safety nets to boost consumption, as
well as globally competitive industries. The icing on
cake is that the energy situation seems to be improving.
Perhaps, the future Chile has been preparing for is
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