The Republic of Chile stretches about 4,260 km from north to south, about 430 km east-west. About 5.5 million of Chile's 14.6 million citizens live in the capital city, Santiago.
The World Bank classifies Chile as a "lower-middle-income emerging economy." 1998 per capita income reached $6,081. Inflation was at 3.6% in 1998; GDP was $78.3 billion.
Chile's is an economic success story. International trade is the main contributor to Chile's successful economy. The government charges a flat 11% rate on most products with an open door policy to many of its neighbors. The average tariff is 6%. The top income tax rate is 45%, with the average taxpayer in the 10% bracket. The top corporate tax rate is 15%, the capital gains tax is 15%, and the value added tax is 18%. Less government is reflected in the Chilean government's 8.1% consumption of GDP, a low figure that allows for economic growth. Chile's social security system is privately owned and operated.
The 1998 Corruption Perceptions Index ranks Chile as 20th out of 85 countries. The Heritage Foundation lists Chile as "mostly free" and ranks it 18th out 161 countries.
Chile is unique in South America, enjoying continuous growth and looking at several new opportunities through NAFTA.
Unemployment is low, the government stable, and society at large tranquil and prosperous. However, Chile faces a difficult year in 1999 as copper prices are forecast to be down, impacting GDP by 10%. Asian purchases represented almost one-third of Chilean exports in 1998.
About 80,000 new passenger cars and light commercial vehicles were sold, as well as 7,000 heavy commercial units in 1998. Chile's fleet is about 2 million vehicles.
Franco Chilena, a local assembler, has an association with PSA and Renault, but must have a local content of 13%. If Chile becomes a member of NAFTA, survival of the local assembler will be jeopardized; the company is expected to close its doors by 2000 should this occur.
Nissan holds 13% of the Chilean market, followed by General Motors, Hyundai, and Daewoo at about 10%. Toyota has an 8% share. Sales of Suzuki and Kia vehicles have fallen. Subaru and Volkswagen plan to continue expansion in the region.
New Car Sales, by Manufacturer
| Company |
1998 |
2005 |
| Nissan |
12,000 |
20,000 |
| GM |
10,000 |
17,000 |
| Daewoo |
9,200 |
8,000 |
| Hyundai |
8,400 |
11,000 |
| Toyota |
6,600 |
16,000 |
| Franco Chilena |
5,200 |
8,000 |
| Volkswagen |
3,600 |
6,000 |
| Subaru |
3,200 |
5,500 |
| Others |
21,800 |
43,500 |
| Total |
80,000 |
135,000 |
|
Country profiles were provided by Raymond Champagne
