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| | |   Chile is located in South America, stretching 4,300 Km along the Western Coastline and only 175 Km east to west, covering an area of 756,950 sq km. This is resultant in a varied temperate climate, ranging from the dry Atacama Desert in the north, Mediterranean in the central region while the south experiences an alpine climate. Chile has a population of approximately 16 million, consisting largely of people of mixed Spanish and indigenous descent. It is an economically dynamic country. Major industries include: copper, fish processing, cements and textiles, chemicals and wine. Economic activity is supported by a well-developed infrastructure, especially in coastal areas where the company's activities will be concentrated.  Chile's Gross Domestic Product (GDP) is expanding, estimates from 2004 show an increase of almost 6% in comparison to 2.2% and is forecast to expand by 5.0 - 5.5% in 2005, driven by the rising copper price. The growth in GDP manifests a successful recovery after recent economic instability, triggered by a severe drought in 1999, maintaining the strongest sovereign bond in South America despite recession. Chile is a politically stable country with an established mining code, making it favourable for foreign investment. Chile became the first country in South America to agree to fair-trade with the USA. The new, centre-left, pro-market president, Michelle Bachelet, was officially inaugurated in March 2006, and under her direction, Chile looks forward to continued stability and economic development. Copper potential in Chile Chile's mining industry is of global importance, accounting for approximately 35% of the world copper production. The country's copper belt is the largest copper deposit in the world. Andes deposits also containing other valuable minerals including molybdenum, gold and silver, which are co-products and by-products of the copper refining process. Along with copper, Chile is the world's largest producer of molybdenum, accounting for approximately 25% of global production. Copper production in Chile has risen from approximately 4.9 million tonnes (Mt) in 2003 to 5.3 Mt in 2004, and is expected to continue increasing to 5.5 Mt in 2005 according to the Chilean government. There are around 140 Mt known reserves in Chile, which means production levels can be maintained for the next 75 years. The mining industry in Chile has grown rapidly since the 1970's and currently generates almost half of the country's foreign trade, contributing approximately 10% of total GDP. Copper exportation reached US$7.6 billion in 2003, the vast majority to Asia, followed by Europe. While the world's largest copper producer is Codelco, half of Chile's copper production is accounted for by privately owned mines which have been increasing their share in the market in recent years. Chile's mining legislation has evolved since the 1980 constitution, whereby all mining resources are owned by the state. Private companies wishing to explore and exploit resources must obtain mining concessions which are granted by the courts. Recent legislation includes a new taxing system which was introduced for mineral companies in May 2005, levying up to operating profits in accordance to the size of company sales. | |
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