L- ~ A MARKET FOR U.S PRODUCTS IN A SUPPLEMENT TO ernationa Commerce U.S. DEPARTMENT OF COMMERCE / Bureau of International Commerce A SUPPLEMENT TO International Commerce ... the weekly news magazine for world traders published by the Bureau of International Commerce and sold by the Superintendent of Documents, U.S. Government Printing Office, Washing- ton, D.C. 20402, and by Department of Commerce Field Offices for $16 a year. A Market for U.S. Products CHILE D E PA R T M E N T C O M MERCE P U B L I C ATI O N ^* T °' C Q, c X sin \ S S *TES OV * / U.S. DEPARTMENT OF COMMERCE John T. Connor Secretary Alexander B. Trowbridge Assistant Secretary for Domestic and International Business BUREAU OF INTERNATIONAL COMMERCE Lawrence A. Fox Director For sale by the Superintendent of Documents, U.S. Government Printing Office Washington, D.C., 20402 - Price $1.00 By Richard M. Kennedy Bureau of International Commerce U.S. Department of Commerce This market survey was prepared under the general supervision of Claude Courand, Director, American Republics Division, and R. F. Rodriguez, Chief, West Coast Section of the Division, Bureau of Inter- national Commerce. Chapter VI, Trade Regulations and Practices, was written by James Ferguson of the Division. Mrs. Irene Johnson of the Division compiled the tables describing U.S. and Chilean exports and the direction of Chilean trade; she also helped in the translation of items in the Chilean tariff. The following members of the U.S. Foreign Service. Santiago, Chile, contributed to the preparation of this report: Thomas Favel and Robert Walker, Economic Counselors; Morris Allen and Harry Zerbel, Commercial Attaches; Gordon Daniels, Dwight Ambach, Martin Prochnik, James Carter, Kenneth Bailey, and Kenneth Guenther, all Economic or Commercial Officers; and members of the Embassy's local staff. Special thanks go to Herbert D. Swett, Acting Commercial Attache. Staff members of the U.S. Department of State and the U.S. Agency for International Development in Washington, D.C., including Rudy Fimbres, Robert Taylor, and Richard Bloomfield, also helped. Many Chileans in both private and public life assisted in supplying data, particularly Sr. Jose Zabala of the Chilean Development Corporation CORFO, Sr. Jorge Berguno of the Chilean Embassy in Washington, D.C., and Miss Marjorie Roe of CORFO's New York, N.Y., staff. FOREWORD The obstacles blocking Chile's take-off into sustained growth have also limited U.S. sales there. These obstacles have included inflation, balance-of- payments disequilibrium, and stagnation in some production sectors. They have been compounded by the earthquakes, fire, and floods which devastated one-fourth of Chile in 1960 and by the only slightly less catastrophic earth- quakes and floods there in 1965. Chile is beginning to overcome these obstacles. It is committed under the Alliance for Progress to carry out reforms which will help the average Chilean participate in the fruits of economic growth. In support of this commitment the United States has extended $121 million annually in official assistance to Chile since 1961. Recent developments definitely signal major improvement in the over-all outlook for sustained expansion of U.S. -Chilean trade. For example, Chile is moving toward implementing its agreements with three U.S. com- panies on large-scale investments in copper mining. Other projects are underway or in advanced stages of planning. As a result, imports of capital goods and raw materials are increasing and U.S. exporters are expanding their activities in the Chilean market. During the first half of 1966, U.S. exports increased an impressive 32 percent over the same period in 1965. The strong demand for U.S. products in Chile should continue in view oi Chile's increasing foreign exchange receipts resulting from favorable world prices for her principal export, copper, and from important assistance by U.S. and international lending agencies. Opportunities for U.S. industry will be lost unless sales efforts are vigorously undertaken. Foreign competition is strong. Import and exchange restrictions are still a factor to be taken into account. Taken together — the opportunities, the challenges, the problems — the current outlook for expan- sion of U.S. exports to Chile warrants U.S. firms making significant new and sustained commitments to obtain new markets. Lawrence A. Fox Director, Bureau of International Commerce November 1966 in CONTENTS Page Foreword iii Abbreviations ix Market Profile x Chapters I. Market Outlook 1 Size and Composition of Market 1 Financing the Expansion 2 U.S. Assistance 3 International Lending 6 U.S. Sales 8 Competition 8 II. Basic Data 11 Geography and Climate 1 1 Population 12 Government 14 Structure of the Economy 14 Industrial Sectors IS Agriculture, Fisheries, Forestry 15 Mineral Resources 17 Manufacturing 19 Power 20 Transportation and Communications 21 Finance 22 Currency 22 Exchange 22 Prices and Money Supply 22 Banking 22 Investment 23 Balance of Payments 23 Foreign Trade 24 Development Plan 25 III. Commodity Analysis 27 Mineral Products 27 Natural Forest Products 29 Animal Products ( Unmanufactured) 29 Agricultural Products 30 Manufactured Food Products 32 Beverages and Manufactured Tobacco 33 Manufactured Textiles 33 Chemicals and Related Products 35 Chemicals 39 Medicinal Drugs, Pharmaceuticals and Toilet Preparations 39 Artificial Fertilizers 40 Chapters — continued Page Explosives, Matches, and Other Pyrotechnics 40 Blacking Resins, Industrial Fats, and Oils 40 Industrial Alcohols 41 Colors. Varnishes, Inks and Dyestuffs _ 41 Soaps and Candles 41 Other Chemical and Industrial Products 41 Metallurgical Products 42 Iron and Steel, Rolled Products 44 Other Metals, Rolled or Cast, and Their Alloys 46 Metal Wares for Various Purposes 46 Wares of Iron and Steel 46 Wares of Other Metals 46 Machinery, Accessories, and Tools 47 Mining Machinery, Implements, Accessories, and Tools 49 Agricultural Machinery, Implements, and Tools 53 Machinery, Accessories, and Tools for Industries and Trades 54 Motive Machinery, Boilers, and Spare Parts 55 Electric Machinery, Apparatus, and Material 55 Transport Machinery. Materials, and Accessories 57 Railway and Tramway Equipment and Materials 59 Watercraft and Navigation Material 59 Vehicles. Not Elsewhere Specified, and Their Components and Spares 60 Miscellaneous Manufactured Products 62 Stones, Earths, Ceramics 62 Wood, Cork, Rubber, Plastic 65 Tannery Products, Furs, Bone 65 Paper, Printed Matter 66 Other Items 66 IV. Distribution 69 Marketing Channels 69 Representation 69 Government Purchasing 71 Selling the Trade 71 Credit Information and Advertising 71 Market Research 72 Practices 72 Trade Associations 74 Transportation 75 Government Representation 77 V. Marketing Aids 79 Department of Commerce 79 Promotional Activities 79 Direct Trade Aids SO Informational Services 80 Department of Agriculture 81 Department of Interior 81 Eximhank 81 Agency for International Development 81 Inter- American Development Bank 81 World Bank 83 Private Aids 83 Credit Information 83 Other 83 VI. Trade Regulations and Practices 85 Import Tariff 85 Permitted and Prohibited Imports 85 VI Chapters — continued Page Import Surcharges °6 Import Registrations 86 Import Deposits °° Exchange Controls 86 Free Ports 86 Sales and Other Internal Taxes 87 Documentation and Fees 87 Labeling and Marking Requirements 88 Samples and Advertising Matter 88 U.S. Export Controls 80 Other Controls 8') Text Tables 1. Estimated and Projected Imports by Major Import Categories, 1961-70 2 2. Imports by Leading Commodities, 1964-66 2 3. Imports of Mineral Products, by Commodity Croups and Principal Commodities, Total and From the United States. 1964 28 4. Imports of Natural Forest Products, by Commodity Groups and Principal Com- modities, Total and From the United States, 1964 29 5. Imports of Animal Products, by Commodity Groups and Principal Commodities, Total and From the United States, 1964 30 6. Imports of Agricultural Products, by Commodity Groups and Principal Commodities, Total and From the United States, 1964 31 7. Imports of Manufactured Food Products, by Commodity Groups and Principal Com- modities, Total and From the United States, 1964 32 8. Imports of Beverages and Manufactured Tobacco, by Commodity Groups, Total and From the United States, 1964 33 9. Imports of Textile Products, by Commodity Groups and Principal Commodities, Total and From the United States, 1964 34 10. Imports of Chemicals and Related Products, by Commodity Groups and Principal Commodities, Total and From the United States, 1964 36 11. Imports of Metallurgical Products, by Commodity Groups and Principal Com- modities, Total and From the United States, 1964 43 12. Imports of Machinery, Accessories, and Tools, by Commodity Groups and Principal Commodities. Total and From the United States, 1964 48 13. Imports of Transport Machinery, Materials and Accessories, by Commodity Groups and Principal Commodities, Total and From the United States, 1964 58 14. Imports of Miscellaneous Manufactured Products, by Commodity Groups and Prin- cipal Commodities, Total and From the United States, 1964 63 Illustrations 1. General Map of Chile 10 2. Chart: Total Chilean Exports and Imports, 1955-65 25 Appendixes A. Notes to Businessmen 91 Passports and Visas 91 Travel 91 Currency Regulations and Banks 92 Hotel Accommodations and Restaurants ')'2 Business Hours 92 Holidays and Vacation Periods 92 Communications 93 Clothing 93 Health and Medicine 93 Electric Current and Weights and Measures 94 VII Appendixes— continued Page U.S. Representation 94 B. Economic Regions 94 North 94 North Central 95 Central 95 South Central 96 Lake Region 97 Austral Region 97 C. Bibliography 99 D. Appendix Tables 1. Chilean Imports, by Sections and Commodity Groups, Total and from Principal Suppliers, 1961-64 100 2. Trade by Geographic Areas and With Principal Countries, 1961-64 107 3. United States Exports to Chile by Commodity Sections and Principal Com- modity Groups, 1964-65 108 4. Total U.S. Economic Assistance to Chile, Disbursements, Calendar Years 1961-65 108 5. Employment by Economic Sectors, 1960 108 6. Population by Provinces, 1960 and 1963 108 7. Estimated Distribution of Personal Income in 1960 109 8. Gross Domestic Product, Gross National Product, National Income, and Per Capita Income, Selected Years 109 9. Gross Domestic Fixed Capital Formation, 1962-64 109 10. Gross Domestic Product by Economic Sectors, 1955, 1960, 1964 109 11. Gross Domestic Product, by Expenditures, 1962-64 109 12. Production of Primary Copper, 1961-65 109 13. Production of Principal Agricultural and Animal Products, 1955 and 1964-65.... HO 14. Production of Principal Minerals, 1963-65 110 15. Production of Principal Petroleum Products by the Concon Refinery, 1956 and 1962-65 110 16. Production of Selected Products, 1959 and 1963-65 HO 17. Indexes of Industrial Production, 1957 and 1963-65 110 18. CAP Shipments of Iron and Steel Products to the Domestic Market, 1962-64 H] 19. Chilean Imports of Iron and Steel, 1962-64 HI 20. Consumption of Electricity by Category of Consumer, Various Years H] 21. Average Exchange Rates, 1956-65 HI 22. Annual Percentage Increase in Consumer Prices for Santiago Alone and Whole- sale Prices in Chile, 1960-65 Ill 23. Balance of Payments, 1962-65 112 24. Exports of Principal Commodities, Total and to the United States, 1962-64 112 25. Total Value and Volume of Imports and Exports, by Ports of Entry. 1964 112 Photographs come from various sources, including the Anaconda Company, Chilean Develop- ment Corporation (Corporacion de Fomento— CORFO) , Grace Line, Inter- American Development Bank (IDB), International Bank for Reconstruction and Development (IBRD), Pan American Union and United Nations. VIII Abbreviations Used in This Study ADELA — Atlantic Community Development Group for Latin America AID — Agency for International Development (United States) AMFORP — American and Foreign Power Company ARCHI — Radio Broadcasting Association of Chile ASMAR — Chilean Navy Dockyard (Astilleros y Maestranzas de la Armada) ASIMET — Metallurgical Industries Association (Asociacion de Industrias Metalurgicas) BDSA — Business and Defense Administration CAP — Pacific Steel Company (Compania de Acero del Pacifico ) CAT — Government Advisory Commission for Trans- port (Comision Asesora de Transportes) CHILECTRA — Chilean Electric Company ( Compania Chilena de Electricidad) COPEC — Chilean Petroleum Company ( Compania de Petroleos de Chile) CORFO — Chilean Development Corporation (Cor- poracion de Fomento de la Produccion) COVENSA — Chilean Nitrate Sales Corporation (Compania de Venta de Salitre y Yodo, S.A.) CSAV — South American Steamship Company Compania Sud Americana de Vapores) ECA — Agricultural Marketing Enterprise (Empresa de Comercio Agricola) EMPREMAR— State Maritime Enterprise (Empresa Maritima del Estado) ENAMI — National Mining Enterprise (Empresa Nacional de Mineria) ENAP — National Petroleum Enterprise (Empresa Nacional de Petroleo) ENDESA — National Electric Enterprise (Empresa Nacional de Electricidad) ENTEL — National Telecommunications Enterprise (Empresa Nacional de Telecommunicaciones) EXIMBANK— Export-Import Bank of Washington FCIA — Foreign Credit Insurance Association FSO — Fund for Special Operations GATT — General Agreement on Tariffs and Trade GDP — Gross Domestic Product GULFSA — Gulf & South American Steamship Co., Inc. IATA — International Air-Transport Association IOGA — Industry-Organized Government- Approved Trade Missions IBRD — International Bank for Reconstruction and Development (World Bank) IDA — International Development Association IDB — Inter-American Development Bank IFC — International Finance Corporation IMF — International Monetary Fund INSA — National Tire Corporation (Industria Nacional de Neumaticos, S.A. ) ITT — International Telephone and Telegraph Company LAFTA — Latin American Free Trade Association LAN — Chilean National Airline ( Linea Aerea Nacional) NASA — National Aeronautics and Space Administration OAS — Organization of American States ODEPLAN— Chilean National Planning (Oficina de Planificacion Nacional) PL-480— Public Law 480 (United States) SPTF — Social Progress Trust Fund USIA — United States Information Agency Office Market Profile Foreign Trade Imports— Total (projected) 1966: $743 million. Total (preliminary data) 1965: $604 million. Major suppliers in 1965 in percent of total: United States, 37; all LAFTA 1 countries, 20; Federal Republic of Germany, 10; Argentina, 8: United Kingdom, 6; Peru, 4; and Brazil, 3. Major im- ports: machinery, electrical equipment, chemicals and related products, petroleum pioducts, transportation equipment, vari- ous industrial manufactures, cereals, textile raw materials, and live animals. Exports — Total (projected) 1966: $741 million. Total (preliminary data) 1965: $688 million. Major markets in 1965 in percent of total: United States, 31; Federal Republic of Germany, 13; United Kingdom. 11; Japan, 11; the Netherlands, 11; and all LAFTA countries, 7. Major com- modities: copper (65 percent of all exports), iron ore, nitrates, molybdenum, fishmeal and fish nil, fruits and vegetables, and paper. Commercial Policy — Prohibitions or severe restrictions on less essential goods and items made in Chile; Government severely limits importation of capital goods when credit terms extend less than 8 years. Import priorities based on require- ments of development plan — particularly for development of industries for export, import substitution, and basic consumer goods. Capital goods encouraged. Trade Prospects — Imports should increase in 1966 if plans for investments in the copper-mining industry are carried out. Mining machinery to be purchased in the United States. In- vestments also planned for several other industries, including petrochemicals, steel, wood pulp, transportation, and electric power. Large-scale economic assistance will stimulate Chilean imports from the United States, but credit requirements and European and LAFTA competition pose difficulties. Foreign Investment The U.S. direct investment estimated at $829 million (book value) at the end of 1965, 61.3 percent in mining and smelting and most of the remainder in utilities. Other foreign invest- ments may total $300 million. The Agency for International Development (AID) investment guaranty agreement covers convertibility, war risks, revolution, insurrection, and expro- priation. 1 The Latin American Free Trade Association (LAFTA) includes Argentina, Brazil, Chile, Colombia, Ecuador, Mexico, Paraguay, Peru, and Uruguay. Venezuela formally became a member on July 12, 1966. Investment Prospects — Official policies encourage foreign investment, especially in development of raw materials and manufactures for export. Political stability, abundant re- sources, and developed transportation power and communica- tions facilities have created favorable conditions for foreign capital. Limited market and chronic economic problems, how- ever, have inhibited investment. Finance Currency — Escudo. On November 1, 1966, the bankers spot rate was 4.31 escudos per dollar, the bankers futures (trade transactions) rate was 4.32 and the brokers (capital and tourist transactions) was 4.15. Domestic Credit -Credit hard to obtain. Domestic Investment — Gross rate of investment, 13 per- cent of gross domestic product (GDP) in 1964. Need for increased savings and private sector investments to achieve balanced growth. National Budget — Past deficits, for which an insufficient tax base is partly responsible, have contributed to inflation. Major steps have been taken to match expenditures with re- sources by development of more efficient budget techniques and tax reform. Balance of Payments — Deficits on current account fi- nanced by substantial inflow of foreign assistance following a severe exchange crisis at end of 1961. Substantial improve- nieni in current account in 1964 and 1965. Export surplus in 1965, primarily the result of increased production and higher prices for copper. Pressure eased by renegotiation of 70 percent of medium- and short-term debt falling due in 1965-66. Exchange reserves remain low. Foreign Assistance - $618 million in commitments of U.S. loans and grants for 1961-65, of which $324 million by AID assistance (primarily program-type loans), $99 million by Export-Import Bank of Washington, Washington, D.C. (Eximbank). and $101 million by Public Law-480. Commit- ments for 1966 include: $50 million not previously disbursed, $80 million program loan, and $10 million capital goods project loan. Other loan assistance may be negotiated. Nearly all U.S. assistance must be used for purchase of U.S. commodi- ties. Chile also receives substantial assistance from interna- tional agencies, such as the International Monetary Fund (IMF), International Bank for Reconstruction and Develop- ment (IBRD), and Inter-American Development Bank (IBD). Oilier countries are beginning to provide development as- sistance, including West Germany, France, Spain and Italy. Economy Chile ranks among the more economically developed Latin American countries. Average annual increase in GDP since 1959, 4.4 percent: in per capita income, 0.9 percent. Chief GDP components (1964), in percent: manufacturing, 19; commerce, 23; public and private services, 19; agricul- ture, 10; mining, the major export sector, 6. Among obstacles to economic development are chronic inflation, low rate of investment, balance-of-payments deficits, and limited domestic markets. Agriculture — Pending agrarian reform law a key economic measure. Main products: wheat, barley, oats, rye, potatoes, sugar beets, rice, corn, beans, lentils, chickpeas, onions, garlic. Industry — Foodstuffs, textiles, fish products, pulp and paper, copper refining, iron and steel, petroleum products, automobile assembly, chemicals, and many other products. Mining — A leading exporter of copper, crude iodine, and natural nitrates. Other important minerals are iron ore, coal, petroleum, molybdenum, and various chemical materials. Basic Economic Facilities Transportation — 5,200 miles of Government railroads pro- vide public services; 1,200 miles of private railroads generally serve specific industries. Major highway construction. Ade- quate air travel and port facilities. Communications — Satisfactory telegraph and radiotele- phone service, both domestic and international; telephone service insufficient, but expansion planned. Power— Chile leads South America in per capita electrical energy consumption. Total installed capacity at the end of 1964 was 1.49 million kilowatts (kw.). A major expansion program is underway. Natural Resources Land— Area, 286,396 square miles— slightly smaller than California, Oregon, and Washington states combined; seventh largest Latin American country. Climate — Varies from the hot, subtropical Atacama Desert in the north (driest in the world) to the frigid islands in the south near the Antarctic; central area in temperate zone. Minerals Rid lineral resources. Forestry — Extensive temperate forests. Insignis pine for pulp is most important species. Fisheries — Rich fishing grounds. People Population — 8.9 million, 2.43 percent annual growth rate. Population mainly urban and concentrated in central Chile. Language Spanish. Education — Literacy rate, 84 percent, one of highest in Latin America. Labor — Active labor force 2,356,000 in 1962, as follows, in percent of total: agriculture. 27; manufacturing, 17; service industries, 24; commerce, 10; construction, 7; mining, trans- portation, communications, and other, 15. »*(pSSS5!* ii - - N\ wSSHR^ 1 " , CHAPTER I Market Outlook The demand in Chile for imported goods may in- crease because of: (1) Substantial progress in imple- menting plans for large-scale investments in copper mining by three large U.S. companies; (2) an im- provement in the country's balance-of-payments posi- tion; (3) favorable prices for Chile's principal export, copper; (4) continued assurances that Chile should receive substantial economic assistance from interna- tional lending institutions, the United States, and some European countries; (5) limited but significant suc- cesses of the current Chilean Government in carrying out its program of economic stabilization and struc- tural reforms; and (6) a reassessment of Chile by foreign investors. SIZE AND COMPOSITION OF MARKET Chile ranks after Mexico, Venezuela, Brazil, Ar- gentina, and Peru as the sixth largest import market in Latin America. Imports have totaled $500 million or more every year since 1960 and have exceeded $600 million in three of those years. Preliminary customs data show total imports of $604 million in 1965. Im- ports should rise 22 percent in 1966 and 19 percent in 1967, according to Chilean planners, and then level off to an annual average of $833 million for the years 1968-70. Table 1 shows balance-of-payments estimates of total imports for the years 1961-65 and projections for 1966-70. The projections apparently reflect Chilean estimates of import requirements necessary to sustain targeted annual growth rates in real gross domestic product (GDP) of 5 percent during 1965-67 and 6 percent during 1968-70. Prompt action on copper in- COPPER MINING: Copper leaching tanks are used to separate copper salts from the ore. vestment plans and a general upswing in domestic and foreign investment will be required to attain these import levels. Table 1 also shows the large extent to which Chilean imports are composed of both capital goods (including most transportation equipment) and raw materials. Table 2 shows in greater detail, for 1964-66, the com- modities making up the major import categories of Table 1. Particularly striking is the fact that con- sumer goods usually constitute such a small part of the total, with agricultural food products accounting for a very large portion of consumer imports. This fact reflects Chile's success, beginning in the 1930"s, in promoting industries based on import substitution for the major types of consumer goods and the failure of Chilean agriculture to keep pace with the growth in population and rising living standards. Customs barriers effectively bar imports of consumer goods for which domestic production is considered adequate. Luxury imports are prohibited outright, and customs charges for less essential consumer goods are often prohibitively high. A limited quantity of imports still enter for use in free port areas, but restrictions have increased even there in recent years. See Chapter VI for a description of Chilean import regulations and policy. While the expansion of Chilean industry has also re- sulted in the substitution of a considerable volume of domestically produced intermediate raw materials for imported products, the overall effect has been to in- crease the volume of raw material imports. This is true even with the exclusion from total imports of crude agricultural products (mostly foodstuffs), which account for about half of all raw material imports. Capital goods imports. 1966-70, are expected to increase. Equipment for the expansion of copper pro- duction is expected to account for a large part of the increase, particularly in 1966-68. These copper in- vestments should also generate increased investment activity in other fields that will stimulate imports. Imports will be required for Chilean Government pro- jects in petrochemicals and power. Chapter II, Basic- Data and Chapter III, Commodity Analysis discusses plans bv the private and public sectors: these plans are expected to generate increased demand for imports. Data on the composition of Chilean imports are contained in Table 1, Appendix D, Chilean Imports by. Sections and Commodity Groups, Total and From Principal Suppliers, 1961-64, and in Chapter III, Tables 3 through 14 under the general title of Imports by Commoditv Groups and Principal Commodities, Total and From the United States. 1964. FINANCING THE EXPANSION The successful financing of the Chilean development program, supported by an increased level of imports, will require careful coordination of both Chilean and foreign financial resources. Under ideal conditions, the largest foreign contribution will come during the early years of the program while Chilean efforts are devoted to maximizing existing productive capacity, preparing new projects, and carrying out the struc- tural and administrative reforms to employ available resources. The greatest increase in Chile's contribu- tion to financing the expansion is expected to come in the late 1960's and early 1970's when increased out- put from copper and other projects should produce a substantial rise in foreign exchange earnings. Chile's development efforts depend on the prompt execution of investments in 1966-71 totaling $420 Table 1. — Estimated and Projected Imports by Major Import Categories, 1961-70 [Millions of dollars] Actual Projected Import 1961 1962 1963 1964 196iT~ 1966 1967 1968 1969 1970~ Capital goods 262 220 211 262 240 310 l.'.ll 410 430 440 Fuels and raw materials 224 199 244 259 256 290 279 288 292 263 Consumer goods 103 91 99 87 95 114 118 109 92 91 Unregistered imports 30 32 28 16 20 30 35 30 25 25 Total *619 T 541 ^86 625 611 743 882 837 839 819 1 These data reflect an adjustment in customs data by the Central Bank for 1963. The 1963 customs data show a total of $637 million, and include imports that actually entered Chile during the two previous years. Source: National Planning Office estimates for 1961-63. and projections from the Development Plan for 1967-70. Notes: Detail may not add to totals because of rounding. These are balance-of-payments data. They differ from customs data used in other trade tables in this report because of adjustments for contraband imports, special imports, certain vessels, and donated merchandise, all of which are excluded from customs data. The data for 1964-66 summarize those given in detail in text table 2. Table 2. — Imports by Leading Commodities, 1964-66 [Millions of dollars] Import 1964 Capital goods and their spares 262 Fuels 27 Coal and unrefined petroleum 24 Gasoline 3 Raw materials 232 Agricultural products 120 Live animals 28 Cereals 20 Wheat 17 Corn Rice 4 Edible oils 5 Textile raw materials 20 Sugar and derivatives 29 Other 20 Nonagricultural products 112 Textiles 3 Chemical and industrial products .. 30 Pharmaceutical products 5 Artificial fertilizers 10 Pesticides and herbicides 3 Fats, oils, and resins 14 Iron and steel 10 Other 35 Metals 7 Nonmetallic minerals 4 Yarn 2 Bags 4 Other textiles 2 Explosives 2 Paints and varnishes 7 1965 1 196fr 240 310 27 48 23 44 4 4 229 242 113 116 12 20 27 31 20 26 4 3 4 3 6 4 21 22 18 18 20 21 116 125 4 4 30 33 6 6 13 14 3 4 14 15 10 11 36 39 7 8 4 4 3 3 4 4 2 2 2 2 7 7 Cement 3 3 3 Paper 4 4 4 Other, n.e.s 2 3 3 Consumer goods 87 95 114 Agricultural products 38 44 47 Fruits 4 3 3 Vegetables 14 16 16 Meats, fats, and dried beef 11 13 13 Milk and derivatives 5 7 8 Flour and starch 3 5 5 Other 1 1 1 Nonagricultural products 49 51 54 Apparel 4 3 3 Pharmaceutical products 4 4 5 Iron fixtures 4 4 4 Vehicles and parts 10 14 14 Rubber and plastic manufactures .... 3 3 3 Printed matter and engravings 5 5 6 Electrical articles, musical instru- ments, etc 4 4 4 Other 7 6 6 Noncommercial imports 9 9 9 Consumer durables for popular use .... 13 Nonregistered imports 16 20 30 Mercha ndise imports, total 625 611 743 1 Preliminary. - Projected. Source: Banco Central de Chile, Boletin Mc-nsual No. i55, Santiago, January 1966, based on data prepared by the National Planning Office (ODEPLAN) and the Central Bank. Notes: Detail may not add to totals because of rounding. These are balance-of-payments data. They differ from customs data used in other trade tables in this report because of adjustments for contraband imports, special imports, certain vessels, and donated merchandise, all of which are excluded from customs figures. N.e.s. — not elsewhere specified. million in copper mining. The earnings to be re- turned to Chile by these investments will be required to sustain the impulse to growth generated by the copper expansion. (See Chapter II for a discussion of the copper investment plans.) This expectation of future earnings places in perspective the large-scale governmental and international economic assistance now being extended to Chile. The deferral by Euro- pean and American creditors of 70 percent of Chile's short- and medium-term debt falling due in 1965 and 1966. and the development and financial assistance described in succeeding sections of this chapter are part of the strategy designed to help Chile through the difficult period before current projects pay off. Chile has experienced a substantial increase in cur- rent foreign exchange earnings as the result of favor- able prices for its principal export, copper. The Government has set priorities for the use of these un- anticipated earnings from higher 1966 prices which include: (1) The recouping of losses from copper mining strikes at the end of 1965 and the beginning of 1966: (2) the reduction of Chile's short-term debt; (3) the financing of the Chilean Government's com- mitment to the joint Government-private copper cor- porations which are to execute the copper expansion: (4) the supply of essential imported consumer goods, if necessary to meet the target of holding the rise in the cost of living to 15 percent in 1966: and (5) the increase in the supply of imported capital goods to the private sector, particularly in support of diversifi- cation. Meanwhile, Chilean planners are revising the 1961- 70 development program, placing increased emphasis on sectorial and project planning (see Chapter II). Many of these projects, when the plans are made, will require the importation of goods and services, and foreign lending institutions are expected to be recep- tive to requests for financing properly drawn propo- sals. Chile is also carrying out structural and ad- ministrative reforms in taxation, budgeting, agricul- tural reform, education, and economic stabilization. These reforms should help the country utilize most advantageously its available resources. U.S. Assistance United States assistance to Chile in support of that country's development efforts has played and will con- tinue to play an extremely important part in financing U.S. exports to Chile. Some form of assistance has been provided since the latter part of World War II. But the greatest flow of assistance began in 1961 and has continued. Thus, total U.S. disbursements in Chile averaged $121 million annually during the years 1961-65, making Chile the largest per capita recipient of U.S. assistance in Latin America. Only U.S. assistance to Brazil in the region exceeds that for Chile in absolute terms. Table 4, Appendix D provides a breakdown of the amounts and sources of U.S. assist- ance to Chile for the years 1961-65. The Agency for International Development (AID) within the U.S. De- partment of State administers the U.S. economic as- sistance program in Chile. The major forms of U.S. assistance to Chile as they affect U.S. exports are the program loan, project loan. Food for Peace Program, and Export-Import Bank of Washington (Eximbank) loans. Program Loan The largest part of United States assistance to Chile has been in the form of program-type loans. Such loans have both a foreign-exchange component and a local-currency counterpart. The foreign exchange component finances a broad range of commercial im- ports selected by the Chilean Government from a list of goods deemed essential to the Chilean development program. The local-currency counterpart consists of the Chilean escudos paid to the Chilean Central Bank by importers in exchange for foreign currency which is remitted to suppliers. The Chilean Government in- vests the local currency so obtained in financing the local costs of development projects. Such projects are selected in consulation with AID. The first loan of this type was the emergency $100-million Earthquake and Reconstruction Loan authorized by the U.S. Con- gress in 1961 in the wake of a devastating earthquake, fire, and flood in 1960. A similar loan for $40 million was made to the Chilean Development Cor- poration (CORFO) in 1962 to finance a series of proj- ects. Annual program loans amounting to 35-, 55-, 80-, and 80 millions of dollars were authorized for the years 1963-66, respectively. Program loans must be used for the purchase of U.S. goods. Under the program loans, special conditions in Chile have led to the use of three different procedures for facilitating the importation of U.S. goods: stand- ard financing, alternate financing, and capital goods incentives. Standard financing procedure. LTsed in most of the countries where the U.S. has made program loans, the standard financing procedure, from the exporter's point of view, is characterized by prior notice that an import is to be AID-financed and a guarantee of prompt payment. The procedure has been used for relatively small direct importations of capital equip- ment by the public sector with funds reserved for that purpose under the program loans of 1963-66. Alternate financing procedure. Chile has used the alternate financing procedure to finance the bulk of imports made under program loans through 1965. Most of these imports were made by importers in the private sector. The U.S. supplier ordinarily does not know prior to shipment if his transaction is to be selected for AID-financing since the Chilean Central Bank does not make the selection until after the ar- rival of the goods in Chile. 1 For that reason, the Central Bank requires that all U.S. shipments be pro- vided with the proper AID documentation. 2 This re- quirement insures that all imports eligible for im- portation under the program loan will be available for selection by the Central Bank for AID financing. Im- ports under the alternate financing procedure are sub- ject to the regular Chilean customs charges and other requirements. Imports financed by medium- and long- term credits are not eligible for importation under a program loan. Capital goods incentives procedure. Regula- tions established by Chilean Central Bank Circular 497 of June 8, 1965 (Banco Central de Chile, Boletin Mensual No. 449 of July 1965), provide a strong in- centive for the importation under program loans of U.S. capital goods, equipment, machinery, and vehicles for production or public transport. Such goods, when selected by the Central Bank, are exempted from cer- tain import surcharges and prior deposit requirements (See Chapter VI: Trade Regulations and Practices). 3 United States exporters are informed by customers prior to shipment that their order is to be AID- financed and that dollar payment will be made by an irrevocable letter of credit issued by a Chilean com- mercial bank and will be backed by a reimbursement authorization issued by the Central Bank against the AID credit. The Chilean importer has 15 days after the approval of his import registration by the Cen- tral Bank in which to open this letter of credit. At that time he must pay the full price of the import in local currency. Substantial portions of the 1965 and 1966 loans have been disbursed on this basis. United States goods enjoy an estimated average 30- percent reduction in their total landed costs when selected for importation under the capital goods in- centives procedure. An importer may find this pro- cedure an attractive alternative to importing capital goods on extended credit terms since the Central Bank must require hard-to-obtain, lengthy credit terms, often in excess of 8 years, because of recent debt 1 The Central Bank makes the selection after shipment and prior to the end of the mandatory waiting period for payment, now 80 days from the date of the bill of lading. 2 See Chapter VI, Trade Regulations and Practices for information on AID documentation requirements. 3 The Central Bank is granting such privileges under regulations governing the importation of goods on extended credit terms (cobertura diferida) . Although such x"'Ogram-loan imports are paid for immediately, the U.S. loan financing the purchases is on 40-year terms. negotiations. With the exception of certain technicali- ties, the procedure is very similar to that in standard financing. Project Loans AID has the authority to make loans in dollars to private and public enterprises, both U.S. and Chilean. Its policy is to make dollar loans only for those projects for which adequate financing from other free-world sources is not available on reasonable terms. Proceeds from these loans are used to purchase equipment and services from the United States under the standard financing procedure. The Chilean Government is very active in the prepar- ation of development plans. Many of its agencies are involved in the drawing up of plans for individual, detailed projects. As more of these plans are com- pleted, more U.S. assistance will go to financing their foreign-exchange costs. AID project loans are now promoting rural electrification and the construction of airports and seaports. These loans have provided seed capital for both a cooperative development bank and a savings and loan system. The savings and loan system promotes the construction of low-cost housing. AID has also made a $3-million loan to finance the feasibility studies of projects which may later be eligible for project loans. Some of the proposals now being considered for a planned $110-$120 million petrochemical industry grew out of feasibility studies. AID may eventually provide assistance to the estab- lishment of Chilean development banks. A special 40-year project loan to the Central Bank designed to finance $10 million in imports of capital equipment from the United States was concluded in early 1966. Priority in the granting of subloans is to be given to imports which promote export activities, agriculture, agricultural processing, and small- and medium-sized mining enterprises. Tractors, agricul- tural and food-processing machinery and equipment, and textile equipment are eligible for importation. The Central Bank will extend local currency credits to individual importers or manufacturers through the commercial banks, CORFO, the State Bank (a state savings institution), the National Mining Enterprise (ENAMI), and other private or public intermediate lending institutions. The commercial risk will be as- sumed by these financial institutions. The terms of the subloans will be based primarily on the life of the selected equipment and other usual commercial con- siderations. This loan is very similar to the $15 million one to Chile by the Eximbank in 1964. Another loan of $3.6 million was made in 1965 for financing the importation of phosphate fertilizers in 1965 and 1966. PULP AND PAPER TOWN: Laja, Chile, pulp and paper mill that was improved with the aid of a loan from the Inter-American Development Bank. The bank loan totaled $17.4 million out of a total $38.2 million pulp and paper project. Other sources of money were the International Finance Corporation, the Canadian Export Credit Insurance Corporation, and the company itself (Compania Manufacturera de Papeles y Cartones, S.A.). Food for Peace Program United States sales of agricultural products to Chile in recent years have been supported in large part by the Food for Peace Program administered by the U.S. Department of Agriculture under U.S. Public Law 480 (PL-480). The PL-480 (Title I) loan agreement concluded in July 1965 called for the importation of $20 million worth of U.S. wheat, corn, butter, nonfat dry milk, and tobacco in 1965. Most of the local currency proceeds from the sale of PL-480 commodities by the Chilean Government are used to finance the local costs of projects in the Chilean Government's development program. However, the 1965 Title I agreement sets aside about 12 million escudos — roughly equivalent to $2.7 million at the current brokers exchange rate — for loans to U.S. firms and their affiliates for local investment costs in Chile or to Chilean or U.S. firms for projects which expand the market for U.S. agricultural products. These are the so-called Cooley loan funds which must be used only for local costs. While they provide no direct stimulus for imports, their availability may help to attract U.S. capital which will be used to import U.S. goods. In extending Cooley loans, AID will give preference to projects which lead either to increased exports or to the production of items which can be substituted for certain types of imports. Such projects would involve the construction or purchase of fixed assets in Chile, such as land, buildings, machinery or equipment of Chilean origin. No loans are made to support the manufacture of products that would be exported to the United States in competition with products manu- factured in the United States, or for the production of commodities to be marketed in competition with U.S. agricultural commodities. Loan applications may be made to the Agency for International Development, Washington, D.C.. or to the U.S. -AID Mission, c/o the American Embassy, Santiago. Chile. Eximbank The Eximbank is a primary source for the financing of U.S. capital goods exports to Chile. United States exports of all types of goods are also assisted by the bank's guarantee and insurance program in conjunc- tion with the Foreign Credit Insurance Association described in Chapter V: Marketing Aids. Total loans granted to Chile since 1951 for the financing of im- ports from the United States are nearing the $400 million mark. The largest loans in the past have been made for the purchase of equipment for the steel, copper min- ing, electric power generating, railway, nitrate and iron ore mining industries. It has also financed general capital goods imports and provided a recon- struction credit following the 1960 earthquake. Exim- bank made Chile the following loans in 1964: $15 million to the Central Bank for relending to commer- cial banks for the purchase of capital goods, $11.3 million for the expansion of steel producing facilities, $2.2 million for textile machinery, and $2.8 million for sawmill equipment. The most recent credit was one for $3.6 million in 1965 for the production of calculating machine card stock. The Eximbank is expected to make the major contribution to financing of equipment imports for the planned expansion of the copper mining industry. International Lending Inter-American Development Bank The organization and objectives of the Inter- American Development Bank (IDB) are discussed in Chapter V: Marketing Aids. The lending resources of the IDB consist of three separate funds from which substantial loans have been made to Chile, most of which have financed a considerable volume of im- ports into Chile. These funds are discussed separately below. Social Progress Trust Fund. Loans totaling the equivalent of $35.4 million were made from the Social Progress Trust Fund (SPTF) to Chilean pri- vate and public entities on very favorable terms during the years 1961-65. Most of these loans were in dollars, but a small amount was in Chilean currency. The equivalent of $13.5 million remained undisbursed from these loans at the end of 1965. The proceeds from these loans have been used primarily to finance local costs of development projects. Goods and serv- ices imported for these projects must be purchased in the United States or from other member countries of the IDB if authorized by the bank as being advan- tageous to the borrower. About one-half of the value of the 1961-65 loans has been used for urban and rural housing, while one-fourth has gone for improving agricultural credit and land use. Loans for improved water supply, higher education, and improved food marketing have accounted for the remainder. Loans were approved in 1965 for housing ($2 million) and improved land use C$1.5 million). Since the resources of the SPTF are nearly exhausted, most lending in the future for such projects will be from the Fund for Special Operations. Ordinary Capital Resources. Loans totaling the equivalent of $68.5 million have been made from the Ordinary Capital Resources fund to Chile during 1961-65. The value of loans to Chile remaining un- disbursed at the end of 1965 was the equivalent of $21.3 million. While most of these loans have been made in dollars, some portions have been in other hard currencies and in Chilean escudos. Procurement of goods and services is carried out by worldwide com- petitive bidding. The promotion of medium and small industrial en- terprises by the Chilean Development Corporation has been supported by loans totaling $20 million. An $8 million loan was authorized in late 1965 and is in- cluded in this total. Seventy percent of this $8 million loan will be channeled into lumber and metalworking enterprises to expand the production of veneers, pre- fabricated houses, plywood, chipboard, metal fixtures, die molds, electrical equipment, certain capital goods, and consumer durables. The remaining 30 percent will be allocated to the construction, chemical, food- processing, and fishing industries. Loans have also been made for the construction or expansion of oil refining ($11 million), pulp pro- ducing C$17.4 million), fishing C$5 million), water supply ($6.2 million), and irrigation ($7.3 million). In addition, a loan of $2 million was made to promote export sales of Chilean capital goods through a Chilean export credit guarantee program. Fund for Special Operations. The equivalent of $28.3 million in loans was made to Chile from the Fund for Special Operations (FSO), during 1961-65, of which $23.3 million had not yet been disbursed at the end of that period. The most recent loan, con- cluded in 1966, helps expand the educational facilities of the Universidad Tecnica Federico Santa Maria in Valparaiso. In late 1965, loans were authorized to help provide adequate water systems for 39 Chilean cities and towns ($15.5 million), to finance preinvest- ment studies ($3 million), and to aid in housing con- struction ($1.2 million). Earlier loans included one for technical assistance to the Agrarian Reform Cor- poration ($0.3 million), one for farm settlement ($6.3 million) and another for an aerial photogrammetric survey ($2.1 million). Portions of some of these loans have been made in local Chilean currency. The FSO took over many of the lending responsibilities of the SPTF after the United States enlarged its FSO subscription in May 31, 1965. As a result FSO is expected to increase substantially its lending activities. Goods and services under such loans may be obtained in the United States, in the borrowing country, or in other member countries of the IDB if the bank au- thorizes such transactions as being advantageous to the borrower. HOUSING DEVELOPMENT: Providing loans for projects such as this housing development in southern Chile is a function of the Inter-American Development Bank. World Bank Group The World Bank group consists of three interna- tional financial institutions: International Bank for Reconstruction and Development ( IBRD or World Bank ) , the International Development Association (IDA), and the International Finance Corporation (IFC). Procurement under loans made by these insti- tutions is effected by bids made by suppliers in member countries and Switzerland. The organization and objectives of these institutions are discussed in Chapter V: Marketing Aids. IBRD. As of June 30, 1965, the IBRD had made loans to Chile totaling $136.2 million and had $46.6 million undisbursed. Its most recent loan to Chile was one of $4.4 million to the National Electric Enter- prise ( ENDESA ) and CORFO to increase the electric power supply in three widely separated areas. Earlier power loans to Chile totaled $61 million. Other loans have been made in support of agriculture ( $27.4 mil- lion), coal mining ($21.8 million), paper manufactur- ing ( $20 million ) , and road maintenance ( $6 million ) . Officials of the bank also participated in a 1965 study of measures to make the Chilean capital market a more efficient instrument in mobilizing domestic capital. IDA. One development loan, a $19 million credit for road construction, has been made to Chile by the IDA. As of June 30, 1965, $13.6 million was undisbursed. IFC. Operational investments in Chile by the IFC are valued at $9.1 million. These loans were used to increase the production of cement, paper, and pasta products. International Monetary Fund While the International Monetary Fund (IMF) does not provide direct financial development assistance to countries, it does help countries overcome the short- run effects of balance-of-payments problems. For example, the $40-million standby credit extended to Chile in April 1966 is the most recent in a series of such credits to Chile. U.S. SALES Chile ranks after Mexico, Venezuela, Brazil, Peru, and Argentina in value of U.S. exports to Latin America. United States sales to Chile could conceiv- ably surpass those to Argentina, and perhaps also to Peru, in the not-too-distant future. Table 3. Appendix D, United States Exports to Chile by Commodity Sec- tions and Principal Commodity Groups, 1964-65, shows that U.S. exports to Chile jumped from $180 million in 1964 to $235 million in 1965. The United States enjoyed an improvement in its share of the market in 1965. Imports from the U.S. totaled $237 million, or 39 percent of Chile's total imports of $604 million, compared with 37 percent of the $607 million total in 1964. This represents a reversal of the recent trend, since the U.S. share of the Chilean import market had declined steadily from 53 percent in 1959 to a post-war low of 35 percent in 1963. The past decline in the U.S. share of the market appears to re- sult in part from import substitution in certain agricul- tural products and raw materials, such as petroleum, which were previously supplied mainly by the United States and in part from increased price and credit competition from European and Japanese suppliers. Machinery and transport equipment accounted for 50.9 percent (SI 19.7 million) of all U.S. exports to Chile in 1965. Transport equipment represented one- fourth of sales in that category. Exports of other manufactured goods (goods not included in other tariff groups) accounted for another 17.6 percent of U.S. exports to Chile while chemicals represented a little under 12 percent. Sales of food and live animals, mostly financed under PL-480, made up another 10 percent of total sales. Exports of beverages and tobacco, crude materials, fuels and lubricants, animal and vegetable oils and fats, and miscellaneous com- modities make up the remaining 10 percent of the total. The pattern of U.S. sales in 1964 was not signi- ficantly different from that for 1965. COMPETITION The most dramatic change in the competitive picture in recent years has been the increasing volume of sales to Chile by countries within the Latin American Free Trade Association (LAFTA). 1 Such sales repre- sented 21.2 percent of total Chilean imports in 1964 and 20.3 percent in 1965, compared with 16.0 percent in 1961. In 1962, the first reduction of trade barriers between LAFTA member countries took place. The greatest gains in sales to the Chilean market by LAFTA members have been made by Mexico and Argentina. The latter is Chile's third largest supplier and traditional leading Latin American trading part- ner. Peru edged ahead of France in 1964 to become Chile's fifth largest supplier (4.0 percent of all im- ports in 1965) as the result of increased cotton sales. Most of the increase has been in LAFTA sales of agricultural food products and crude materials, but there has also been a significant surge in sales of manufactured products, particularly machine tools and office equipment by countries such as Brazil and Argentina. Table 2, Appendix D shows Chilean trade by geographic areas and with principal countries. 1961-64. Western Europe, however, continues to present the sharpest competition in the Chilean market for machinery and transport equipment, chemicals, and other manufactures. Sales from Western Europe reached a peak of 34.7 percent of the Chilean import market in 1963, but fell back to 32.4 percent in 1964 and 30.4 percent in 1965. The Federal Republic of Germany continued to be Chile's second largest sup- plier with 10.5 percent of the import market in 1965, but its sales had slipped from a high of 14.0 percent in 1961. Exports from the United Kingdom slipped slightly to 6.4 percent in 1965. French sales had climbed from 2.4 percent in 1961 to 5.0 percent in 1964. However, the latter percentage is probably un- usually high because of one-time sales of jet aircraft in 1964 under a credit granted in connection with the Chilean earthquake of I960. France's share dropped to 2.5 percent in 1965. Italy, in significant part through railway equipment sales in recent years, has regularly supplied about 2 percent of the Chilean import market. Price and credit are probably the most important competitive factors in the Chilean import market. This, of course, does not mean that Chileans underrate the importance of quality and service but that foreign exchange availabilities and often tight domestic credit conditions by necessity shape the importer's calcula- tions. 1 Argentina, Brazil, Chile, Colombia, Ecuador, Mexico. Paraguay, Peru, and Uruguay constitute the Latin American Free Trade Asso- ciation. Venezuela officially became a member of LAFTA on July 12, 1!)66, but the details of its new commercial relationship with member countries remain to be worked out. 8 A large portion of capital-goods sales is dependent upon the ability and the willingness of suppliers to provide relatively lengthy credit terms. Following debt renegotiations in January 1965, the Central Bank of Chile initiated new efforts to clear up commercial arrearages and to limit increases in new short- and medium-term credit obligations by both the public and private sectors. The policy of the bank has been to restrict new supplier credits with terms of 8 years or less. There are no restrictions on supplier credits of more than 8 years' duration. The Chilean Government has announced that a por- tion of increased earnings resulting from higher copper prices will be used to reduce Chile's short-term debt. This may result in a modest increase in the country's capacity to incur new short- and medium- term credit obligations. In order to gear imports of capital goods to Chile's development goals, the Central Bank has decided which imports financed by supplier credits will receive top priority. The seven categories, in descending order of priority, are: (1) Capital goods for the production of exports; (2) Capital goods for the production of import sub- stitutes; (3 ) Consumer goods and services of basic necessity; (4) Capital goods for processing Chilean raw materials; (5) Transportation equipment; (6) Items necessary for general administration and the maintenance of public order; and (7) Capital goods for modernization, enlargement, or improvement of production facilities. Evidence of the trend toward longer terms for supplier credits and growing Government involvement in Chilean development efforts by European countries was the financial protocol signed by France and Chile in February 1966. It provides for total French credits to Chile of between 230-250 million francs (US$46.6- .6 million), including: (1) A 50-million-franc (US$10.1 million) supplier credit of 8-years' duration to CORFO for the purchase of French capital equipment by the private sector; (2) A 100-million-franc (US$20.3 million) mixed credit (part supplier and part Government credit) of between 8- and 10-years duration; (3) An agreement in principle to provide a 15- year loan to finance 33 percent of the cost of certain unspecified Chilean development pro- jects. The remaining 67 percent of the 80-100- million-franc costs (US$16.2 to $20.3 millions) is to be financed by 8- to 10-year supplier credits. In March 1966. representatives of four Italian credit institutions supplying medium-term credits signed an agreement with the Chilean Central Bank covering a 6,250-million-lire (US$10 million) credit for the purchase of Italian machinery, plants, and re- lated accessories over a two-year period. Repayment is to be in 14 semiannual installments beginning in June 1967. The interest rate to Chile is 6 percent, with the Italian Government subsidizing the difference be- tween that and the actual 8.5-percent rate. According to an April 1966 Central Bank report, old or newly negotiated credits extended by the Federal Republic of Germany totaling nearly $30 million were available for use by Chile in 1966. The largest of these is $11 million for the purchase of German machinery and equipment. Another $10-mil- lion credit will be used for imports in the construction of a sugar beet refinery in Nuble Province near Con- cepcion. A total of $16.5 million in local currencies generated by imports financed by the above two credits will be used to finance local costs of the refinery and other projects to be selected in the future. The re- maining credits are to be used for the importation of the following: equipment for medium and small in- dustries in the private sector, transport equipment for the State Railways, port machinery and equipment, hospital equipment by the National Health Service, and trucks by the Ministry of Public Works. The United Kingdom, Switzerland. Finland, and Italy are reported to have extended other credits to Chile for use in 1966. CHAPTER a Basic Data GEOGRAPHY AND CLIMATE Chile extends 2,630 miles in a ribbon of land along the west coast of South America from the subtropical north to the Antarctic Zone (latitudes 17° to 56 °S.). It is 221 miles wide at its broadest point (just north of Antofagasta) and has an average width of 109 miles. Despite its narrow but extraordinary length, the country ranks only seventh in size in South America (Uruguay, Paraguay, and Ecuador being smaller). Its area, 286,396 square miles, equals that of Cali- fornia, Oregon, and half of Washington State. Valparaiso, the chief seaport, is 5,965 miles by water route to New York. From the standpoint of both geographic and economic characteristics, Chile may be divided into three main zones — north, middle, and south. Each of these divisions has distinctive subregions. The point of transition between northern and middle Chile is usually set at 30° S. at La Serena, but some geographers move the southern boundary of north Chile to the Copiapo River. The 400-mile stretch be- tween Copiapo and the Rio Loa embraces the great Atacama Desert, one of the driest regions on earth. Although cloud banks form daily along the coast, and there are occasional summer showers in the Cordillera, rain is virtually unknown in the longitudinal valley or pampas, where the coefficient of evaporation is greater than in the Sahara Desert. This is the region of the nitrate fields and copper mines. In the extreme north and from Copiapo south are several river valleys which sustain some agriculture. Middle Chile extends about 900 miles, from latitudes 30° to 43° S., including the island of Chiloe. Most of the population is concentrated here. About two-thirds of this region has a mediterranean climate, with mild, wet winters and long, dry summers. Nights are cool in summer and cold in winter. Rainfall, which is less than 10 inches annually at La Serena, increases to- ward the south. It averages 13.8 inches at Santiago and ranges between 23.6 .and 31.5 inches from the Rasin of Rancagua to the Maule River. South of Con- cepcion, rainfall ranges between 50 and 80 inches. From the Maule River to the Bio-Bio there is a transi- tional zone in which the longitudinal valley has the semiarid characteristics of the Central Valley, but the western flanks of the coastal mountains and the Cor- dillera receive substantial rainfall. South middle Chile, from Bio-Bio to Puerto Montt. has a short but well-marked dry season favorable to wheat, potatoes, oats, fruit, and pasture. Forests originally covered most of this region and still occupy close to half of the area. The stormy winters and cool summers resemble the Pacific northwest of the United States. South of the Tolten River are a number of lakes, dominated by snowcapped volcanoes. The scenery attracts many tourists. The southern third of Chile's territory is a region of mountains, fiords, high winds, and heavy rains. Along the coast are many islands and waterways. 11 This part of Chile on the Atlantic side near the eastern end of the Strait of Magellan may be consid- ered a distinct geographic zone. The climate is cold, dry, and windy. Like the Argentine Patagonia, this region is notable for sheep raising. Petroleum and gas deposits are exploited in this region, mainly on the island of Tierra del Fuego. In physiography and climate, Chile resembles North America from Alaska to Lower California. Chile's climate ranges from the subtropical deserts in the north to the rain forests of Aysen Province and the tundras of Magallanes Province in the extreme south. The cold Humboldt Current, moving north- ward from the Antarctic along the coast, tempers the climate of the coastal regions of central and northern Chile. A coastal range, rising from the sea along most of the coast, varies in height from 7,000 feet in the north to less than 2,000 feet in the vicinity of Concepcion. Beyond this range are a series of valleys, basins, or pampas, and to the east the Andes and their spurs occupy from one-third to the entire width of the country. In middle Chile the Central Valley is nearly con- tinuous, except for minor hills, from Santiago south to the Bio-Bio River. North of Santiago the longitu- dinal depression disappears, being pinched out by spurs of the Andes. Here the "waist" of Chile has a width of only 56 miles. The highest peak in the Western Hemisphere — Aconcagua, elevation 22,835 feet — rises at the head of the river of the same name, near the middle point of Chile's long eastern frontier. As far south as lati- tude 35° S., the passes over the Andes are all above 10,000 feet. POPULATION The Chilean people are mostly of European ancestry, predominantly Spanish, but the native Araucanian Indian makes a substantial contribution to the popula- tion stock. The Chileans are estimated to be roughly 66 percent Spanish-Indian, 25 percent Spanish, and 5 percent Indian, with fractional percentages of Ger- mans, Italians, French, British, and other nationalities. Although a complete fusion of the races has not come about, few, if any, South American nations have a more homogeneous population. The pureblooded Araucanians of south Chile number about 1 30.0(H). Of Chile's gainfully occupied population in 1960, 30 percent was engaged in agriculture, 19 percent in manufacturing industries, but only 4 percent in the economically dominant mining industry. Table 5, Ap- pendix D shows employment in Chile by economic sectors in 1960. In population, Chile ranks sixth among Latin American countries and fifth among South American countries. As of January 1966, the population was estimated at 8.9 million. Its rapid average annual growth of 2.43 percent approaches the 2.5-percent figure for Latin America as a whole. Both immigra- tion and emigration are neglible. Concentrated in the central third of the Republic, Chile's population is mostly urban. Greater Santiago, with a population estimated at 2.4 million in January 1966, is by far the principal city and accounts for a disproportionate share of the nation's total purchas- ing power. Other leading cities, with their 1960 populations are: Valparaiso, 259,241; Concepcion, 167,468; Vina del Mar, 126,441; Antofagasta, 89,114; Talca, 80,277; Chilian, 82,947; and Temuco. 111.641. The Province of Santiago is also the leading Province. Chile's population by provinces is shown in Table 6, Appendix D. While the population of Chile is predominantly Roman Catholic, the Constitution provides for free- dom of worship, and an atmosphere of religious toler- ance prevails. Church and State are separated. Spanish is the language of Chile, but many Chileans, as well as foreigners resident in Chile, also speak English. Standard of Living. — Among Latin American countries, Chile has enjoyed a relatively high stand- ard of living. Real per capita income is estimated to have increased 1.6 percent annually during 1940-63. While this increase was made possible by a great expansion of manufacturing and commerce, the failure of agricultural production to keep pace with the growth of population has become a serious im- pediment to further gains. A great disparity exists between the low income of rural workers — with their absence of labor organiza- tion — and higher incomes of urban workers — with their organized bargaining power, particularly in the petroleum, chemical, mining, and steel industries. These factors have also conditioned the relative ability of these sectors to defend their position in the face of rapid price inflation over the past decades. A large proportion of the population in rural areas exists only on the fringe of the modern money economy at near- subsistence levels. The estimated distribution of Chilean incomes is shown in Table 7, Appendix D. The current Government has strongly committed it- self to helping an increasing number of Chileans par- ticipate in the national market. It views this objective both as a primary aim of social policy and an es- sential requisite for overall economic growth. Education. — Under a law of 1842, Chile became the first Latin American Republic to establish a sys- tem of public education. In the same year it also be- came the first to establish a national normal school. 12 NUMBER ONE ON WEST COAST OF SOUTH AMERICA: Valparaiso, Chile, chief commercial town on South America's Pacific coast, seaport, railhead. Since 1920, elementary education for children be- tween the ages of 7 and 13 has been compulsory in Chile, and the number of schools has increased con- tinually. Schools operate under a centralized na- tional program, with Government-approved private schools continuing to play an important part. Ap- proximately 30 percent of the students attend private schools. Elementary school students may go on to public secondary schools or private and church schools. Vocational education is highly developed in the country. There are schools of agriculture, trade and industry, mining, business, art, and nursing. The national university is the University of Chile in Santiago. There are also the Catholic University of Santiago, University of Concepcion, Catholic Uni- versity of Valparaiso, Santa Maria Technical Uni- versity of Valparaiso (outstanding because of its ad- vanced methods of training in technical and engi- neering courses), Universidad Tecnica del Estado, and the Universidad Austral del Chile in Valdivia. Chile also has a School of Industrial Engineering and three schools of social service. Only the University of Chile is authorized to grant advanced degrees and professional titles, and it must approve candidates of other universities. The country also has naval, mili- tary, and aviation schools. Chile's literacy rate is high. About 84 percent of all persons 15 years of age and over are literate. 5 In 1961 Chile devoted 3.5 percent of the national income to education. In terms of the national budget 21.09 percent of total expenditures were devoted to educa- tion. Health. — Chile's general level of health and sanita- tion is above average in Latin America. Its National Health Service provides some form of care to at least 5 The rate of functional literacy is certainly much lower, but Chile is still amonp the most literate nations of Latin America. The Chilean Government recently has devoted considerable attention and resources to the problem of literacy. 13 70 percent of the population. In recent years a con- siderable advance in health safeguards has been made, but many health problems still confront the country, particularly in rural areas. GOVERNMENT Chile, known officially as the Republica de Chile, is a Republic with a centralized form of government. It has the reputation of being one of the most democratic nations in Latin America. There is a national tradi- tion of respect for the constitution, public order, and the decision of the ballot box. The present Constitu- tion dates from 1925. Executive power, generally broader than in the U.S. system, is vested in a Presi- dent, elected by direct vote for 6 years. The legisla- tive body consists of a Chamber of Deputies elected by direct vote for 4 years and a Senate elected by di- rect vote for 8 years. The judiciary is an independent branch of the Government consisting of a supreme court, appeals court, and lower courts. Chile is a unitary rather than a federal state. The largest political subdivision is the Province, headed by an intendant who "is the usual and immediate agent" of the President. The intendant is advised by a Provincial Assembly, members of which are chosen by the municipalities. The alcaldes (mayors) of cities of more than 100.000 inhabitants are appointed by the President. Chile has a multiparty political system. While for- mal party coalitions are prohibited in congressional and municipal elections, they are a necessity in presi- dential elections and for the functioning of Congress, since no party, until the 1964 presidential election, has been able to marshal the support of a majority of the electorate. Until 1964, the largest party was the Radical Party which played a leading role in the ruling center-right coalition of former President Jorge Alessandri. The largest Chilean party is now the left-of-center Christian Democratic Party which, with the support of other Chileans, elected its presidential candidate Eduardo Frei in the September 1964 elections. Presi- dent Frei's 56-percent majority overcame the opposi- tion put up by a coalition of the Socialist and Com- munist parties. The Christian Democrats obtained a majority in the Chamber of Deputies in the congressional elections of March 1965, but its increased representation in the Senate ( where one-half of the members were up for election ) did not reach the one-third mark. Since a one-third vote is necessary to uphold the presidential veto, the Christian Democrats must sain the votes of other party members in the Senate to enact its program. The next congressional election is scheduled for March 1969. STRUCTURE OF THE ECONOMY 7 Rough preliminary estimates credit Chile with a gross domestic product (GDP) of 6,517 million escudos in 1965, a 5-percent increase over that for 1964. More complete data for 1964 show a GDP of 6.207 million escudos, up 2.4 percent from 1963. Na- tional income in 1964 was 5,110 million escudos. an increase of 2.4 percent over 1963, while per capita income declined 0.8 percent to about 591 escudos. The growth of Chilean gross domestic and gross na- tional product, national income, and per capita in- come for the years 1940-65 is shown in Table 8, Appendix D. In the decade 1954-63, the average annual increase in GDP was 3.3 percent; national income, 2.9 percent: and per capita income, 0.4 percent. Comparable data available for all but the last year of the Alessandri administration (1959-63) show average annual in- creases of 4.1 percent in GDP, 4.0 percent in national income, and 1.5 percent in per capita income. These figures suggest the magnitude of the problem which Chile must overcome to boost per capita income in the face of a 2.5-percent annual increase in population. Other major obstacles to economic development in recent years have been a continuing price-wage spiral resulting in chronic inflation, continuing labor difficul- ties in key industries, the destructive earthquake of 1960, the earthquake and floods of 1965. and the reluctance of many foreign and domestic investors to initiate new productive activities in the face of these and other problems affecting the climate for in- vestment. While the mining industry is usually highlighted in any discussion of the Chilean economy because it ac- counts for the bulk of the nation's foreign exchange earnings, the mining sector actually has regularly ac- counted for less than 5 percent of GDP during the 1954-65 decade. Manufacturing and commerce are the largest contributors to GDP with substantial contri- butions from agriculture and both private and Gov- ernment services (see Table 10, Appendix D). Agri- culture, including forestry and fisheries, contributed 14 percent in 1955 but only 10 percent in 1964. This shift results not so much from a transfer of resources into other sectors, as might be expected in periods of development, but from the inability of the agricultural sector to match the growth rates of the other economic sectors. In 1964, gross fixed capital formation was 751 million escudos, or 12.1 percent of GDP. Since 1957, 8 Unlike the U.S. system, the Chilean allows its President to veto portions of hills or add others. 14 7 All fiprures in this section are in. 1061 market prices, unless otherwise stated; 1.05 escudos=US$l in 1961. Chile's gross fixed capital formation has averaged nearly 11.5 percent of GDP, with a high of 13.3 per- cent reached in 1961 (reflecting greatly increased im- portation of machinery and equipment in support of reconstruction and development activities financed by foreign assistance). While separate figures are not available for private and public fixed capital forma- tion, it appears likely that the public share of such investment has increased substantially in recent years in Government and joint Government-private enter- prises. Similarly, expenditure by Government enter- prises, such as the National Petroleum Enterprise I ENAP ) . are reported in the national accounts as private consumption expenditures. Thus, it seems likely that overall Government expenditures have been growing as a percentage of GDP. See Tables 9 and 11. Appendix D for a breakdown of expenditures as related to GDP and gross national product. INDUSTRIAL SECTORS Agriculture, Fisheries, Forestry Agriculture. — Agriculture is the principal eco- nomic support of probably two-thirds of the Chilean people. But the proportion of agricultural workers to the total economically active population of Chile had declined from 39 percent in 1930 to 28 percent in 1962. Agricultural production has not increased as rapidly as population and consumption. This has led to in- creased dependence upon imported foodstuffs with a consequent drain on foreign exchange. Absentee ownership, resulting in neglect of land and of its productivity, and technological backwardness are con- sidered to be the chief contributors to low agricultural yields. The major goals of Chilean agriculture in recent years have been to reduce reliance on imports, in- crease foreign exchange earnings from exports, and to improve the lot of the farmer. Steps in this direc- tion have included the Agrarian Reform Law of November 1962 which established the legal principle that ownership of land is contingent upon its proper use. A subsequent amendment to that law permits the Government to purchase land defined as under-util- ized. However, major implementation of the Govern- ment's agrarian reform program awaits action on a sweeping agrarian reform bill submitted to the Chilean Congress in late 1965. The recent completion of a $5.4 million aero-photo- grammetic survey, in cooperation with the Organiza- tion of American States (OAS) and the IBD, is ex- pected to be used in carrying out agrarian and tax re- forms as well as economic planning. The survey cov- ered 85 percent of Chile's most valuable farmland. However, much remains to be done, particularly in the provision of commercial credit, the establishment of adequate marketing and transportation facilities, and the creation incentives for increased production. The production of principal crops, 1955, 1964, and 1965 is shown in Table 13. Appendix D. Fisheries. — Poor catches of fish in 1965 and 1964 led many observers to believe that the fish-reduction industry of the north had become overexpanded, over- concentrated, and overspecialized. During the years 1961-63, $50-$60 million in new capital had been invested in the zone extending from Arica to Taltal. Unfortunately, the catch in 1965 probably totaled only 305,900 tons, the lowest total since 1961. CORFO has prepared plans to reorganize and restructure sev- eral of the plants (particularly in Iquique). Increased financial assistance from CORFO is to be accompanied by direct Government participation in both ownership and management. Congress in early 1966 was studying a bill which included provisions to ease plant mergers. Improved fishing at the end of 1965 produced predic- tions of fishmeal exports in the neighborhood of 165,- 300 tons for 1966, which would yield more than $23 million in export earnings at projected prices. At the beginning of 1964 there were 16 fishmeal plants in operation in the north with a capacity of 436 tons of raw materials an hour. Fourteen plants, with a potential total capacity of 479 tons an hour, were under construction, but not all of them have been completed. The accent in the future would appear to be on consolidation and the creation of more efficient operations. The current fishing fleet supporting the northern industry numbers 200 purseseiners, comprised pre- dominantly of 110- to 187-ton modern steel vessels equipped with echo sounders, radio sets, and power equipment for handling the nets. However, many vessels were not in operating condition at the end of 1965 because of maintenance problems during the long layoff. Development of the fisheries of central and south Chile has been slow. Plants processing frozen shrimp and plated lobster ( langostino ) and fresh fish have, however, acquired some new plant equipment to im- prove processing, and two plants have substantial expansion projects underway. Part of this investment was in response to foreign demand for frozen shrimp and langostino. The development of canneries in this area has been static, except for promotion of king crab canning in the Straits of Magellan. Some 27 processing plants are located in central Chile (between Coquimbo and San Vicente) with a total capital in- vestment of not more than $7 million; in addition, there are six in the Calbuco area of south Chile, with a total investment of less than $1 million. The fishing fleet has declined substantially in this area and is made up, to a great extent, of thousands of small boats carrying on antiquated operations. The interest 15 of both Government and private capital appears to be shifting to processing of fish for human consumption — frozen, canned, salted, and smoked. The expansion of refrigeration facilities should substantially increase the demand for food fish. Forestry. — Chile's forest and forest products indus- try ranks among the most important in Latin Amer- ica, and its full potentialities for development are still far from realization. Some 27 percent, or 50.4 million acres of Chile's territory is classed as forest lands ( i.e., woods, open woods, scrubby growths, and lands without vegetation but which have reforestation po- tential ) . Only one-half of this area is readily accessible by existing roads. Chile's forests begin in the central zone at 35° latitude S. and cover almost the entire southern zone to 42° latitude S. The natural forests consist of approximately sixty different species, mostly hardwood. The most important development in recent years has been the introduction of the insignis pine (pinus radiata), the specie most employed for re- forestation. Increased demand for this specie is re- flected in expansion plans of existing sawmills and in the construction of entirely new mills. The amount of timber cut has increased steadily in recent years. Much of this growth results from the increasing de- mand for insignis pine by paper and pulp producers. More than 90 percent of Chilean lumber production is consumed domestically. An aggressive Government- sponsored housing program, railroad maintenance and modernization operations, and steady construction activity in the private sector have accounted for the bulk of consumption. There are still untapped oppor- tunities for investment in lumber, paper and pulp, and veneer-producing operations. In 1963 there were 1,115 sawmills in operation, em- ploying 21,772 workers directly, and perhaps 60,000 CHILE'S MODERN LUMBERJACKS: Large pine reserves provide the raw material for pulp and newsprint that Chile exports to neighboring countries. m. fl\ persons indirectly. The industrial timber harvest in 1964 totaled 5.1 million cubic yards, of which 3.1 million were softwood and 2.0 million hardwood. Sawed lumber production totaled 1.4 million cubic yards, of which softwood accounted for 700,000. hardwood 628,000, and unclassified wood (such as railroad ties) for 55,000 cubic yards. Chile should be able to compete well in lumber and pulp and paper within the LAFTA market. Its position should be enhanced by the expected decline in supply of its chief competitor to the insignis pine, Brazil's Pino del Parana, but much remains to be done in establishing common lumber standards and quality controls. The future growth of the Chilean forestry industry is thought to depend, in part, upon the development of a viable conservation program. It is estimated that forest fires have destroyed in excess of 10 million acres of forest lands within the past 15 years. Denuded watersheds have caused erosion, resulting in the annual loss of thousands of acres of once productive land and in the diminution of water supplies vital to the growth of future agricultural and industrial pro- duction. Mineral Resources Chile is one of the world's leading exporters of copper and ranks first in the output of natural nitrates and iodine. It is an important producer of molyb- denum, coal, iron ore, and petroleum. Except for petroleum, it is self-sufficient in all of the above and in ceramic, refractory, construction materials, gold, and silver. It is potentially an important producer of several chemical materials, such as sodium sulfate, potassium perchlorate, and magnesium sulfate. Other metallic minerals produced include manganese, mer- cury, lead, and zinc; the nonmetallics include sulfur, phosphates, clays, salt, borax, quartz, and lime. Table 14, Appendix D shows Chilean production of principal minerals in 1963-65. Plans for expanding the mining industry are discussed in some detail in Chapter III: Commodity Analysis, under the section "Mining Ma- chinery, Implements, Accessories and Tools." The mining industry is the mainstay of the Chilean export economy. Although it accounts for less than 5 percent of gross domestic product and employs only about 4 percent of the labor force, it supplies more than 80 percent of all export earnings and about one- fourth of total Government revenues. By far the greatest part of these earnings are accounted for by the Gran Mineria (large mines), although production by the Pequena y Mediana Mineria (small and medium mines) is of increasing importance. Until 1964, the Gran Mineria was defined as those copper companies producing more than 27,550 tons of copper annually, and those iron ore producers that return to Chile only production expenses. Thus, in 1963, it consisted of Kennecott's Braden Copper Company Anaconda's Chile Exploration and Andes Mining Companies (copper), Bethlehem-Chile Iron Mines Company, and, for statistical purposes, the Anglo- Lautaro Mining Company (nitrates). In 1964, the Chilean Congress raised the minimum copper produc- tion requirements for inclusion in the Gran Mineria to 82,650 tons. Productivity in the mining industry as a whole is higher than in any other Chilean economic activity. It is twice that of manufacturing and three times that of agriculture. The operations of the large mines are among the largest and most modern in the world. The medium mines are also efficiently operated and pro- duce both concentrated, blister and refined copper. The small mines, on the other hand, have been character- ized for the most part by small, partly mechanized, high-cost operations generally producing only ores and concentrates. The Chilean Government, however, has had considerable success in its program to encourage production in the smaller mines through subsidized purchases of ore during times of low prices. Mining employment is estimated at 42,000 persons. Approximately half of these work for the large foreign copper, nitrate, and iron mining companies. ENAMI is playing an increasingly important role in the small and medium copper mining sector by its ore purchasing programs, its operation of concen- trators, smelters and refineries, and its provision of technical advice and small loans for development purposes. Copper. — Chile produced 641,999 tons of copper in 1965, compared with 685,073 tons in 1964, interrupt- ing a steady upward climb in production levels. The setback was the result of serious labor difficulties near the end of 1965. Although a new outbreak of labor trouble occurred in early 1966, the damage to the Chilean economy was expected to be mitigated by sharply rising prices for copper. The Gran Mineria, consisting of Anaconda's Chile Exploration and Andes Mining companies and Kennecott's Braden Copper Company, have regularly produced between 80 and 85 percent of all copper mined in Chile. The medium and small mines have also experienced steady growth, producing 113,902 tons of primary copper in 1965, compared with 103,551 tons in 1964. These mines include the Empresa Minera de Mantos Blancos, the Cia. Minera Disputada de las Condes' El Soldado and Disputada mines, and Anaconda's Santiago Mining Company. Table 12, Appendix D shows a more de- tailed breakdown of production for the years 1961-65. The long-planned, new investment of $420 million by the Anaconda, Kennecott, and Cerro copper com- panies and the Chilean Government, and the expan- sion of the medium and small mines are expected to boost Chilean production of primary copper to 1.3 17 million tons annually by 1972. This presumes in- creased annual output (from 1964 production levels) of 209,000 tons by Anaconda, 99,000 tons by Kenne- cott and 66,000 tons by Cerro. A description of the expansion programs of these companies is contained under Mining Machinery, Implements, Accessories and Tools in Chapter III: Commodity Analysis. Refining capacity is to expand from 303,000 tons (1964) to at least 771,000 tons annually. Most of the increased output will be electrolytic copper. This in- cludes the Government's Las Ventanas 88,000-ton re- finery which began operation in 1966 and which will be expanded to 187,000 tons by 1970-71 to handle pro- jected increased Kennecott output. Counting the exist- ing refinery capacity of Kennecott and the Mantos Blancos mine, Chile will become the world's third largest refiner of copper. The Government is now studying several proposals by foreign copper fabricating firms to establish new producing facilities for finished copper products. In accordance with Chilean aims of establishing greater control over the foreign owned copper mining companies, agreements were reached with the U.S. companies whereby they would expand production and the Chilean state would become a partner in the equity structure of certain mines. These agreements are embodied in Law 16,425 of January 25, 1966, and Law 16,464 of April 25, 1966, which amend Law 11,828 of May 5, 1955. The latter law— the so-called New Deal Copper Law — had previously governed the operations of the large mines. The wording of decrees allowing the new copper program to begin is now being studied with physical initiation of the program expected sometime during the second half of 1966. In the case of Anaconda and Cerro, Chile will re- ceive 25-percent equity in the capital and administra- tion of their Exotica and Rio Blanco deposits, respec- tively. The Chilean state will also have 49-percent equity participation in a new joint Government- Ana- conda exploration company which will search for new ore deposits. Operating companies established as a result of these efforts will also have Chilean state equity participation. One of the most important developments is the transformation of Kennecott's Braden Copper Com- pany into a new enterprise to be called the El Teniente Mining Company. Kennecott will own 49 percent of the new firm, with the remainder passing into the pos- session of the Chilean Government. The Copper Cor- poration, a semi-autonomous state agency, will be the Government's representative in most copper mat- ters, particularly ownership and sales policy affecting the large mines. Chile will pay $80 million for its equity, the amount to be reinvested in increasing production at El Teni- ente, to be repaid at low interest over a period of 18 years. The Government will also loan the new com- pany $20 million. The new firm will seek another $100 million from foreign financial sources. New in- vestments in the Anaconda and Cerro projects will total $135 million and $81 million, respectively. As a consequence of the total $420-million invest- ment, the country will receive an average of $40 mil- lion annually in the years 1966-70 for project costs. The benefits from these projects will not be felt fully in the Chilean economy until 1971. According to early conservative estimates based on a price of 29 cents per pound for copper, x Chile by 1971 will receive an estimated $301 million annually in foreign exchange earnings from copper, compared with $186 million in 1963. Both the short- and long-run demand for copper now appear to be greater than earlier estimated. The copper legislation also contains detailed provis- ions regulating taxation of the companies and social welfare benefits to be accorded to mineworkers em- ployed by the large mines. For its part, the Chilean Government will provide support and active participation in financing; stabil- ize the tax, profit, and foreign exchange regimes; provide a guarantee against discrimination against copper company investments; and give import duty exemptions for equipment required for the new pro- jects. A side effect of the new investment will be greatly increased production of molybdenum, gold and silver, and a stimulation of coal consumption and production because of the increased electric power needs of the copper companies. Iron Ore. — The rapidly growing iron mining in- dustry of Chile, with reserves estimated at close to 1 billion tons, has ranked second since 1960 among Chile's extractive industries, both in value of pro- duction and export earnings. Production in 1965 totalled about 13 million tons, compared with output in 1964 of about 10,858,192 tons. Three companies produce more than 85 percent of Chile's iron ore — Compania Acero del Pacifico (CAP), Bethlehem- Chile Iron Mines, and the Santa Fe Mining Company. The remaining tonnage is mined in small operations. These are managed by contract personnel and sell their output to one of the larger companies. Plans for expanding production of the industry are discussed in Chapter III: Commodity Analysis under Mineral Products. Nitrates and Iodine. — Chile's nitrate ranks third behind copper and iron ore as an earner of foreign exchange. Production in 1965 was reduced by strikes, reaching only 1,276,116 tons, compared with 1,294,- 080 tons in 1964. Chile continues to be the world's 8 In April 1966 the Chilean producer price for copper was raised from 42 to 62 cents per pound: it was increased to 70 cents in July 1966. Currently the price is somewhat lower and is equivalent to the future price of the London Metals Exchange. prime producer of iodine (a by-product of the pro- duction of nitrates) with total production of 2,511 tons in 1965, compared with 2,383 tons in 1964. The nitrate industry has for some time been reorganizing its financial and marketing structure and appears to be improving its position. The Anglo-Lautaro Nitrate Company regularly accounts for more than 80 per- cent of all Chile's nitrate and more than 90 percent of its iodine output. Plans for the industry are discussed under "Mineral Products" in Chapter III: Commodity Analysis. Coal. — Chile is an important coal-producing coun- try, although it faces major problems in making coal competitive with other energy sources. Production totaled 1,903,154 tons in 1965, almost all soft coal, compared with 1,971,286 tons in 1964. Except for coking coal, Chile supplies its own coal needs and is substituting coal for petroleum products whenever feasible as a stimulant to the coal industry. The Lota-Schwager mines I which account for 85 percent of Chile's coal output) are being consolidated and modernized. Petroleum and Gas. — After a rapid growth in output, Chilean production of crude petroleum leveled off at about 70.6 million cubic feet, annually and is expected to decline in the future. While the discovery of additional petroleum reserves has been unsatisfac- tory to date, gas production and reserves have in- creased sharply, with production totaling between 219- 222 billion cubic feet in 1965 and 1964. The Empresa Nacional de Petroleo (ENAP), the Government enter- prise which controls all petroleum exploration and production hopes to use an increasing amount of gas for fuel and as a source of raw materials for a pro- jected petrochemical industry. Most of the gas, a by- product of petroleum production, is now reinjected. Chapter III: Commodity Analysis, Mineral Products, discusses the Chilean market for crude petroleum. Man u facta rin g Manufacturing, which is of growing importance to the Chilean economy, accounts for nearly one-quarter of the gross domestic product and employs about one-fifth of the economically active population. Manu- facturing centers are in Santiago, Valparaiso, and Concepcion. The leading sectors are the food-beverage and the textile industries which each account for about 25 percent of the value of manufacturing output. Pulp and paper accounts for 20 percent and heavy in- dustry for 15 percent of output. Remaining output is accounted for by the chemical industry, 5 percent, and miscellaneous manufacturing, 10 percent. Domestic industries produce most of Chile's re- quirements for steel, petroleum products, pulp and paper, cement, tobacco products, beer, refined sugar, shoes, textiles, numerous household commodities, tires and tubes, and a great variety of other products. Chilean production of selected products is shown in Table 16, Appendix D. Further information on these industries is contained under the appropriate sec- tions of Chapter III: Commodity Analysis. The growth of manufacturing in recent years has been slowed greatly by the ills suffered by the economy as a whole. Rapid inflation has brought with it rising costs, labor difficulties, and price con- trol problems. Under such conditions, capital has often sought safer fields. This has made it more diffi- cult to obtain funds for expansion in an already tight credit situation. Scarce foreign exchange reserves have resulted in the imposition of stringent import and exchange restrictions. These have made it im- possible or very costly to obtain desired imported manufacturing machinery, parts, and raw materials. On the other hand, the inability to obtain many foreign products has long provided a stimulus to domestic production. Table 17, Appendix D shows the production indexes of Chile's leading industries for the years 1957 and 1963-65. Iron and Steel. — The Compania de Acero del Pa- cifico (CAP), a private Chilean company with minor- ity Government participation, turns out more than 90 percent of all Chilean iron and steel products. Its Huachipato mill on San Vicente Bay just north of Concepcion is Chile's only basic iron and steel pro- ducer. The remaining production is accounted for by several small firms employing electric remelt fur- naces to produce steel for casting and shaping. CAP's production and imports of iron and steel products for the years 1962-64 are shown in Appendix D, Tables 18 and 19. CAP's expansion program is discussed in Chapter III: Commodity Analysis under the section Metallurgi- cal Products. CAP is a leading proponent of some form of re- gional integration, complementation, or preferential tariffs among Latin American countries. Its proposals have made but little progress, yet it has found another way of obtaining complementary benefits. In early 1964, CAP announced that it was entering into a joint venture in Ecuador to form a new steel com- pany. The factory is expected to produce 29.000 tons of iron and steel products in its first year of opera- tion. CAP is initially expected to supply the firm with 17,000 tons of semifinished steel annually. Possi- bilities exist that CAP will attempt to arrange similar or other forms of complementary agreements with still other Latin American countries. The establish- ment of some form of marketing agreement between Chile and Argentina seems likely. Petroleum Products. — All phases of Chile's petro- leum industry, with the exception of distribution, are in the hands of ENAP. Distribution is handled 19 through local branches of Esso Standard Oil Com- pany (Chile) and Shell, each handling roughly one-fourth of the market, and COPEC, a privately owned Chilean firm which has a marketing agree- ment with Mobil Oil of Chile. Chile has one refinery in operation at Concon and another about to begin working at Concepcion. Chilean plans for the develop- ment of a petrochemical industry have generated in- terest in the expansion of refinery output. Table 15, Appendix D, shows Chilean production of petroleum products for 1956 and 1962-65. Chilean imports of refined petroleum products are reported in Chapter III: Commodity Analysis under the section, Blacking Resins, Industrial Fats and Oils. Chemicals. — The Chilean chemical industry is composed of two principal groups: one mines and processes chemical raw materials (actually a branch of the mining industry), and the other manufactures industrial chemicals, drugs and medicines, paints and varnishes, and allied chemical products. The first steps have already been taken in the development of a petrochemical industry which would require in- vestments of more than $100 million. The plans for this industry are discussed in Chapter III: Com- modity Analysis under Chemicals and Related Products. Paper. — The manufacture of pulp and paper is one of the fastest developing industries in Chile, and it appears destined to achieve substantial further growth. Chile is self-sufficient in its production of the principal paper products, and its possession of ample raw materials has given it a decided competi- tive advantage, making Chile the only net exporter of pulp and paper products in Latin America. Chapter III: Commodity Analysis describes Chilean produc- tion of paper products under the section Miscellaneous Manufactured Products. Textiles. — The textile industry is one of Chile's oldest and most highly developed. The domestic in- dustry very largely supplies the Chilean market, although there is still an important demand for some imported products. The textile industry is described in some detail in Chapter III: Commodity Analysis under Manufactured Textiles. Automotive Industry. — Chile has an active auto- motive assembly industry in Arica, but its future development there, or its transfer to another part of Chile is dependent upon legislation before the Chilean Congress. The industry is discussed under Transport Machinery, Materials, and Accessories in Chapter III: Commodity Analysis. Food Products. — The foodstuffs industries may be divided into those which mostly utilize domestic raw materials and those that depend on imported materials. The first includes flour milling; wine 20 making; canning of fruits, vegetables, and fish; prep- aration of condensed and powdered milk; and the manufacture of food pastes, crackers, and bakery products. Industries depending largely upon imports are brewing, sugar, meat, vegetable oils, and confec- tionary. Each year about 20,400 tons of canned fruit, 13,200 tons of vegetables, 7,200 tons of fish, and 3,100 tons of shellfish are produced. Chileans spend ap- proximately one-half of their disposable income on food products, while about one-half of the retail price of food products consists of marketing costs and margins. Power Chilean gross power consumption totaled the equiv- alent of 14,528 million kilowatt hours (kw.-hr.) in 1964. The sources for the generation of this power were, in percent: petroleum, 49.3; hydraulic energy, 25.6; coal, 14.0; wood, 10.7; and other sources, 0.4.° Electric power generated in 1964 totaled 5,928 mil- lion kw-hr. Table 20, Appendix D shows consump- tion of electric power by type of consumer for 1964. Total installed generating capacity at the end of 1964 was 1.49 million kilowatts (kw.), of which 51.8 percent was thermoelectric and 48.2 percent hydroelectric. An autonomous Government enter- prise, the National Electric Enterprise (Empresa Nacional de Electricidad — ENDESA), controls 35.6 percent of this capacity; independent public power producers, 26.5 percent; and the large mining com- panies of the north, which produce for their own use, 37.9 percent. ENDESA and the independents make up the so-called interconnected public power system. The largest of the independents is a subsidary of the American and Foreign Power Company (AMFORP), the Compania Chilena de Electricidad (CHILECTRA) . The Chilean Government and AMFORP have reached an agreement containing the following provisions: (1) Purchase by Chile of AMFORP's holdings of CHILECTRA stock, plus assumption of part of the company's debt for $34.4 million; (2) reinvestment by AMFORP of $29.4 million in Chilean development projects of the company's choice; and (3) guarantee by the Chilean Government of the repayment in dollars of an additional $52.1 million in CHILECTRA debt to its parent, plus a release of AMFORP from obligations to CORFO and the Eximbank. Chile hopes to raise the generating capacity of ENDESA and the other public power producers from 927,000 kw. in 1965 to 1.25 million kw. by 1970-71. For a further discussion of the industry's plans, see the section entitled Machinery, Accessories and Tools in Chapter III: Commodity Analysis. Includes fuels which generate power directly and those which are used to generate electric power. -*c SAND, NO; WATER, YES: Water for the Sauzal, Chile, powerplant is delivered free of silt that is removed in this desilting works. Transportation and Communications Chile has a well-developed railway system which is being improved. The road network is also well-devel- oped, based on a hard-surfaced highway which runs the length of the country. Many of the roads are not hard surfaced. A substantial program is underway for the improvement of existing roads and the con- struction of transverse and feeder roads. Because of the country's great length, air service is particularly important to the nation's economy, and several new airports have recently been com- pleted or are under construction. For the same reason, cabotage is well developed in Chile, although the size of the domestic fleet has not grown in recent years. For a description of Chile's domestic and international transportation facilities, see Chapter IV: Distribution and Appendix A: Notes to Businessmen. Programs for the expansion or modernization of Chilean trans- portation facilities are discussed under the section, Transport Machinery, Materials and Accessories in Chapter III : Commodity Analysis. Telegraph service between all of the principal cities and towns is provided by the Chilean State Telegraph Company (Telegrafo del Estado). A number of small private firms are also authorized to provide limited telegraph service throughout the country. Railway telegraph is used to carry commercial messages in areas where these companies do not operate. Telephone service is provided by nine companies, all but one of which are privately owned. The Cia. de telefonos de Chile (CHILTELCOh a subsidiary of International Telephone and Telegraph Co., is by far the largest, accounting for over 95 percent of the total (approximately 240,000) telephones in use. CHILTELCO awaits ratification of an agreement with the Chilean Government under which it would sell 49 percent of its equity to Chile and begin work on an $125-million expansion program. A Government enter- prise, Empresa Nacional de Telecommunicaciones. has 21 been established and will be responsible for operating the basic telecommunications network. For a descrip- tion of these developments, see Chapter III. FINANCE Currency The basic monetary unit of Chile is the escudo which is divided into 100 centesimos and which re- placed the peso on January 1, 1960, at the rate of 1 escudo for 1,000 pesos. Paper currency is issued by the Central Bank and is legal tender in unlimited amounts. Its legal value corresponds to its purchasing power in the market. No par value has been declared to IMF. Coins of silver, copper-nickel, and bronze- aluminum alloys are in circulation. International gold transactions now must be carried out through the Central Bank. Exchange A dual exchange system is in operation in Chile. The bankers rate, basically, applies to international transactions in goods and invisibles associated with merchandise trade and transactions of the Government and its semi-public entities. At this time, most inter- national trade transactions are covered at the prem- ium bankers futures rate, with payment ordinarily corresponding with the end of the mandatory 80-day payments waiting period. A brokers rate applies to a relatively few transactions not permitted in the bankers market, including tourism, repatriation of capital, and remittance of earnings. While both of these rates were intended to fluctuate freely, the Cen- tral Bank has exercised considerable influence over the exchange market. Regulations are in force limiting operations on the brokers market to banks, requiring gold transactions to be carried out through the Cen- tral Bank, limiting foreign exchange available for tourism, and restricting the letters of credit issued by domestic banks to foreign suppliers. See Chapter VI: Trade Regulations and Practices for further in- formation. These exchange rates have undergone steady de- preciation since their unpegging in 1962. A recent promising trend has been the narrowing of the spread between the bankers spot and forward rates, although the gap between the bankers rates and the more de- preciated brokers rate is still considerable. These were the effective buying rates as of November 1, 1966, in escudos per US$1: bankers spot, 4.31; bankers future, 4.32; and brokers, 4.95. In 1965, the bankers spot rate depreciated by 28 percent, the fu- tures rate by 14.5 percent, and the brokers rate by 28.7 percent. See Table 21, Appendix D for the average Chilean exchange rates for the years 1956-65. There has been a very substantial improvement in foreign exchange availabilities in Chile from the years 1962 and 1963 when payment delays often reached a year or more, and when some payments could only be made in the form of dollar-denominated bonds (pagares). The official waiting period for im- port payments has been reduced from 120 to 80 days with most payments effected shortly thereafter, and the Chilean Central Bank is devoting a significant portion of increased earnings from exports to elimin- ating arrears and reducing the mandatory delay. Most delays beyond the mandatory waiting period are now the result of tight credit or documentation problems. Prices and Money Supply Chile has experienced severe inflation in recent years. Consumer prices rose 45 percent in 1963, and the increase has exceeded 25 percent every year since 1962. The current Government has proclaimed the containment of inflationary pressures to be essential to its achievement of social and economic goals. The Government early proclaimed its aim of limiting the overall rise in the cost of living to 25 percent in 1965, 15 percent in 1966, and 10 percent in 1967 while permitting prices for agricultural products to rise more rapidly relative to those for industrial products. The limiting of consumer prices to an increase of 25.9 percent and of wholesale prices to 24.5 percent in 1965 represented a major achievement. However, strong upward pressures on prices continued to be evidenced by the 32.7-percent rise in the wholesale price index for domestic products and the 64-percent increase in the money supply in 1965. The Govern- ment's new wage policy establishes a sliding scale for wage adjustments based on increases in the cost of living. Under that policy, the lowest paid workers have had their wages increased by the full amount of price increase, while better-paid workers will receive a scaled-down raise. Considerable progress is being made in the fiscal sector in increasing revenues through reform of the tax structure and tax admini- stration while installing more precise budgetary con- trols and reducing the deficits of autonomous Govern- ment agencies and enterprises. Table 22, Appendix D shows the increases for retail prices, wholesale prices, and the money supply, 1960-65. Banking The Chilean banking system consists of the Central Bank of Chile (a private bank with Government representatives on the board of directors), 28 private commercial banks, 2 mortgage credit institutions, the State Bank of Chile, and 2 development banks (The Mine Credit Bank and the Agricultural Colonization Bank). The latter three banks are state-owned. As originally established in 1925, the Central Bank was primarily designed to discount commercial paper and to maintain the stability of the currency. A series 22 of special laws gradually changed the character of the bank, enabling it to provide credit both to the Government and to commercial banks and private in- dividuals. It helps regulate credit and plays a major role in setting and administering import policy. Nearly all imports must have the bank's approval, and almost all gold and foreign exchange transactions — including requests for remittances to foreign suppliers — are controlled by the bank. The Government has intro- duced legislation to bring the Central Bank under direct Government control. The State Bank of Chile is the sole depository of funds held in Chile not only by the Chilean Treasury but also by Chilean official and semi-official institu- tions. It is also the only savings bank. Of the 28 private commercial banks, 4 are foreign banks with branches in Chile. Only one, the First National City Bank of New York, is United States- owned. A private industrial development bank and a cooperative development bank may be established with the assistance of both the IDB and AID. At present, CORFO is the principal source of in- dustrial credit. Its activities, in the past, have been generally oriented more toward the establishment and promotion of new industries rather than toward facilitating credit to industry. Investment Chile's diversified natural resources and enter- prising population have long favored foreign private investment capital. Historically, foreign investment has played an important part in Chile's economic growth, particularly in such basic industries as min- ing, transportation, and electric power. Unfavorable investment factors have included Chile's overdepend- ence on mineral exports, an archaic agricultural economy, a limited domestic market, and a history of Government control of exchange, foreign trade, prices, and other economic activities. On balance, however, Chile's democratic tradition in government, competent businessmen, adaptable labor, and wide range of natural resources should provide a favorable field for foreign capital in the future. Direct foreign investments in Chile are concen- trated in the mining sector. No exact figures as to overall direct foreign participation are available. Some sources estimate them at between $1.2-$1.3 billion, of which over $500 million is in mining. A recent estimate sets the probable total of U.S. investment in Chile at about $1 billion, divided as follows: mining, $750 million; utilities, $175 million; other, $75 million. The book value of direct private U.S. capital invested in Chile, as reported by the U.S. Department of Commerce, Office of Business Economics, was esti- mated to be $829 million at the end of 1965, as follows, in millions of dollars: mining and smelting, 509; manufacturing, 39; trade, 24; and other (in- cluding utilities and petroleum), 257. Chile's Foreign Investment Law of March 1960, extends benefits and incentives to foreign investors by (1) guaranteeing freedom to repatriate capital and remit profits, (2) providing tax guarantees, and (3) allowing for the duty-free entry of capital equip- ment and raw materials in many instances. Such bene- fits may be extended to new industries using a high percentage of local raw materials and to those in- dustries established to produce for export. Emphasis is placed on foreign capital that will initiate, promote, and improve production in agriculture, mining, fish- ing, and manufacturing. Exchange treatment for such investments was for- malized by the Central Bank of Chile through issu- ance of Circular 332 (November 6, 1963) of its Foreign Trade Department. The Circular establishes conditions under which investments made with the purpose of encouraging or increasing exports of agricultural, industrial, or mining products may be brought into the country through the brokers' ex- change market while permitting the repatriation of capital and remittance of earnings from exchange earnings to be calculated at the more favorable bankers rate. The Central Bank, with the help of seed capital provided by the IDB, has also estab- lished a special credit system to give more immediate encouragement to exports. The Chilean and U.S. Governments in December 1963 agreed to expand their Investment Guaranty Agreement of July 1960 to cover war risks, insurrec- tion, revolution, and expropriation in addition to convertibility. While this agreement has not yet been ratified by the Chilean Congress, coverage is effective for any investments approved by both governments under the agreement. Active stock exchanges are located in Santiago, Concepcion, and Valparaiso. The stocks of some 350 companies are traded there. While Chile's chronic inflation has tended to stimulate holding of securities, other factors, including tight credit controls and po- litical uncertainty, have restrained market activity. New stock offerings are often made on one- to three- year credit terms, frequently with a downpayment, but new issues have been difficult to sell. Balance of Payments Chile's balance-of-payments prospects have been greatly improved, thanks to higher copper prices and increased copper production. Official 1966 balance- of-payments estimates, published before 1966 in- creases in copper prices, foresaw merchandise exports and imports in balance at about $745 million each. The same estimates predicted a deficit on current account of $146 million which was to be counteracted 23 by a net capital inflow of $220 million. Copper ac- counted for about 60 percent of all Chilean export earnings in both 1964 and 1965. According to the general rule of thumb, each cent-per-pound increase in the price for copper at current Chilean production levels results in about $7-$8 million in increased ex- change earnings annually for Chile from the exports of the large mines. The precise effect of this increase on the Chilean balance of payments is difficult to pre- dict because the above calculation does not take into account the rising production of the medium and small mines, production losses from strikes early in 1966, and the future condition of the world copper market. The Chilean Government has stated that some of the increased earnings will be used to retire a portion of Chile's foreign public debt — estimated to be in excess of $1.8 billion — and to import equipment needed to increase domestic industrial production. Chile gained temporary respite from its heavy debt burden falling due in 1965 and 1966 through renego- tiation in February 1965 of 70 percent of its Gov- ernment and Government-guaranteed medium- and short-term debt. Chile experienced serious balance-of-payments prob- lems during 1960-63, when deficits on current ac- counts were due primarily to trade deficits. The current account deficit was sharply reduced in 1964 (thanks to the near-balancing of the trade account) and reduced even further in 1965 as the result of both the first export surplus ($84.3 million) since 1962 10 and tightening of controls on imports. Since 1962, these deficits have frequently been financed by large-scale official capital inflows — primarily in the form of long term foreign assistance loans. Thus, net official capital inflows averaged $132 million annually for the years 1962-64 and probably was very close to that average in 1965. Disbursements of all forms of U.S. economic assistance during the years 1961-65 averaged $121 million annually. (Chile's balance of payments for 1962-65 is reported in Table 23, Appen- dix D and U.S. assistance to Chile for the years 1961- 65 in Table 4, Appendix D). Chile has also received very substantial assistance from international finan- cial institutions, such as the IMF, IBRD, and IDB. Foreign Trade The total value of Chile's combined exports and imports have exceeded $1 billion every year since 1961. The value of this two-way trade exceeds that of the more populous Republics of Peru and Co- lombia. On a per capita basis, Chile's foreign trade outranks that of Argentina, Brazil, or Mexico. Chart 10 Customs data shown in Table 2, Appendix D, shows export sur- pluses for 1962 and 1964. However, balance-of-payments data pre- pared at a later date, which take into account such factors as smuggling, report trade deficits going back to 1959. 24 I shows total Chilean exports and imports for the years 1955-65. Chilean exports of copper and copper wire, alone, accounted for 65.3 percent of her total exports of $626 million in 1964. Iron ore (11.1 percent), ni- trates (4.8 percent), and molybdenum concentrates (2.4 percent) were other large individual export items. Fruits, vegetables, wool, cellulose, and paper products are increasingly important for exports. Poor fishing has reduced fishmeal and fish oil sales in recent years, but a revival is expected in this im- portant export category. Chilean exports of prin- cipal commodities, 1962-64, are shown in Table 24, Appendix D. The United States continues to be the largest single market for Chilean exports, with purchases totaling $213 million in 1965 (31 percent of all Chilean exports in 1965). In 1965 Germany took 13 percent, and the United Kingdom and the Netherlands II percent, each, of total exports. Chilean sales to Japan have risen to 11 percent of the total. Chile severed its diplomatic and trade ties with Cuba in 1964 in conformity with an OAS resolution. Table 2, Appendix D shows total Chilean exports by regions and principal countries for the years 1961-64. Chilean exports to LAFTA (primarily to Brazil and Argentina) have not kept pace with Chilean imports from LAFTA countries. Thus, while LAFTA products accounted for 20 percent of Chile's total $604 million in imports in 1965, sales to LAFTA represented only 7 percent of all Chilean exports. The slower increase in exports to LAFTA, compared with imports from LAFTA, has been one of the principal motives for the Chilean Government's actively seeking more effective modes of Latin American economic integration. In addition to the mutual reduction of customs charges within LAFTA. Chile has negotiated complementation agreements for trade in electron tubes and statistical machinery and electronic-data processing systems among Argentina, Brazil, Chile and Uruguay. Under these agreements each country is to supply the other with designated products or components. Important steps have been taken, aimed at integrating the auto- motive industries of Argentina, Brazil, and Chile. Special arrangements have been worked out for trade in iron and steel products between Ecuador and Chile, and studies have been undertaken with respect to 14 industries involving trade between Argentina and Chile. More recently, Chile has exchanged trade mis- sions with Venezuela (a new LAFTA member) ; these missions have discussed integration schemes involving several industries. Venezuela, as a leading supplier of crude petroleum to Chile, may figure in Chilean plans for a petrochemical industry. The establishment of such an industry on the scale projected by Chile can only be achieved with access to the LAFTA market. Total Chilean Exports and Imports, 1955-1965 1958 1957 1958 1959 * Preliminary customs data Source: Banco Centra! de Chile, Boletin MensuaK various issues. DEVELOPMENT PLAN Chile was one of the first Latin American countries to produce a national development plan. The Ten Year Plan (1961-70) called for an impressive 5.5- percent annual growth in the gross domestic product and a 3-percent increase in per capita income. This would have required an increase in gross domestic investment from 10 percent to about 18 percent of gross domestic product. Agricultural production was projected to increase by 5.5 percent, mining by 6 percent, and manufacturing by 6.5 percent annually. An increase in installed electric power from 1,304,000 kw. (1960) to 2,569,000 kw. in 1970 was projected. The length of paved roads was expected to rise from 1,740 miles in 1961 to 3,420 miles by the end of the 10-year period. Freight capacity of the nation's rail- way system was expected to increase by 40 percent over the period. The total cost of these investments was estimated at 9.5 billion escudos (equivalent to $10 billion at 1960 prices), of which $2.5 billion was calculated to be the foreign exchange cost. Foreign exchange costs of investments were estimated as follows in millions of dollars: manufacturing, 831; transporta- tion, 500; power and fuel, 411; mining, 364: agricul- ture, 111; urbanization and communications. 64: and other activities, 260. While many of the plans goals have been achieved on or ahead of schedule, performance in some areas has lagged. The failure to reach agreement on invest- ments in copper mining has been particularly trouble- some since increased earnings from these investments were to have been a major source of financing for the later stages of the program. The current Gov- ernment is now preparing a revised plan for the years 1966-70. The revised plan is not expected to be com- pleted until the end of 1966 and is expected to contain more detailed projections for individual economic sectors than the original plan. The Minister of Finance has announced that Chile hopes to make these increases under the plan, in percent: agricultural output. 300: mining. 62: manu- facturing, 63; transportation, 72; and construction. 175. At the same time, increases in administrative services are to be held to 19 percent and intermediary services to 8 percent. To finance this expansion in the plan, the Minister stated that investment would have to double and exports increase by 70 percent. 25 CHAPTER in Commodity Analysis In this chapter, the Chilean import market is dis- cussed in terms of the commodity classification system employed in the Chilean tariff. The tariff is divided into 13 major sections, such as Section I: Mineral Products and Section XII: Transport Machinery, Ma- terials and Accessories. These sections provide the headings for each of the principal parts of the text and the accompanying tables of this chapter. The 13 sections are subdivided into 81 commodity head- ings, known as groups. For example. Group 4: Coal and Mineral Fuels falls under Section I: Mineral Products. The groups are included in the above-men- tioned tables and may supply subheadings in the text. The groups are further subdivided into individual products or types of products and assigned a num- ber in the Chilean tariff, e.g., 1515-021, glass wool, conglomerated. If a product is not included in the group in which it would logically fall, other related sections should be checked. For example, the item 1419-001, fixed seats for automobiles falls under Group 64: Railway and Tramway Equipment and Material. For convenience sake integrated projects which create demand for different types of equipment are grouped together. Thus, a planned copper mining project which would require trucks, earthmoving equipment, rail transport equipment, communications equipment, structural steel, and explosives is usually discussed under only one heading — in this case Group 59. For each of the larger statistical classifications an attempt is made to indicate the magnitude and com- position of such imports over the years as well as the principal countries of origin for those products. In- formation is included on local production, consump- tion, and other data useful for evaluating the market. The existence of domestic production of a product is particularly significant since the Chilean Govern- ment provides extensive customs protection for do- mestic industries. In general, when a domestic industry can supply local demand for an item, the importation of that item is either prohibited outright or dis- couraged by heavy import duties, surcharges and prior deposits. Where the local industry can meet only part of the demand for a product, protection is still quite formidable but not necessarily prohib- tive. Information on the rates of duties and other restrictions applicable to a particular product imported into Chile may be obtained by writing the American Republics Division, Bureau of International Com- merce, Department of Commerce, Washington, D.C. See also, U.S. Department of Commerce, Bureau of International Commerce: Basic Data on the Economy of Chile, Overseas Business Reports 64-138, January 1965. In addition, the Bureau prepares more detailed market studies on individual commodities. Those studies may be obtained upon request. Their titles are indicated, as released, in the Department's Business Service Checklist, mailed weekly upon request. Mineral Products Although Chile is rich in a wide variety of mineral resources and mineral exports are the principal source of exchange earnings, importations of crude mineral HYDROELECTRIC POWER: Abanico Spillway Canal of Empresa Nacional de Eleiti kidad viewed from the iorebav. 27 products have ranged from 4.4 to 12.3 percent of total imports during the past decade, but only between 6.2 and 4.4 percent during the years 1961-64. In the years 1961-64, imports of crude mineral products averaged $32 million annually. In 1964, unrefined and semirefined petroleum products accounted for 53 percent of crude mineral imports, while coking coal accounted for 15.6 percent of such imports. Until 1961, the U.S. share of crude mineral products fluc- tuated around the 90-percent mark, but in that year Venezuela, the Netherlands Antilles, and Peru became very active in supplying the petroleum market. Indeed, Venezuela emerged as the leading supplier of mineral products in 1962 and 1963, although the United States regained its position in 1964, with 42.5 percent of the market. Table 3 shows Chilean imports of mineral products. While the level of crude oil imports has leveled off in recent years because of the great upswing in domestic production by ENAP, Chilean crude reserves may be insufficient for supporting current production levels. While output of crude reached a new high of 76. 8 million cubic feet in 1964, production dropped, for the first time, in 1965. Although the search for new fields is being actively pursued, results so fat- have proven disappointing. Reserve estimates based on current production levels range from 5 to 10 years, and it now appears that the growth of Chilean petroleum self-sufficiency has been reversed. Chile supplies all of her own coal needs, except for high grade coking coal used by CAP, near Con- cepcion, which imports about 40 percent of its coking coal needs. CAP now operates 70 coke ovens with a 1,650-ton daily capacity. Gross coal production was 1.903,156 tons in 1964, mostly bituminous with some lignitic production. Coal imports in 1964 consisted of 481,808 tons of coking coal, 11 tons of anthracite, and 116 tons of metallurgical coke — all supplied by the United States. Coking coal imports should con- tinue to increase as the CAP moves ahead in its active expansion program. CAP has greatly expanded its steel ingot produc- tion to meet current Chilean needs and is rapidly moving forward with a program to further increase capacity (see Section on Metallurgical Products). Steel ingot production totaled 599,819 tons in 1964, but only 486,092 tons in 1965 because of strikes. The nonferrous metals industry supplies almost all do- mestic recjuirements and carries on a substantial ex- port trade. Seven firms are engaged in the recovery of nonferrous metals and alloys from new and used scrap and dross. While metals represent a small portion of the Chilean import market, substantial increases have been registered by aluminum, tin, and zinc. Increased consumption of tin is expected to result from the expansion of the domestic canning industry. Chile's only producer of zinc shipped ore with 943 tons of metal content to Belgium in 1964, with about 85 percent returned to Chile for local consumption. The Government plans to follow the same course with lead, 1,322 tons of which (metal content) were pro- duced in 1964. Imports of lead, in ingots, totaled 1,986 tons. The United States is the principal sup- plier of aluminum and zinc, while the United Kingdom leads in tin. Chilean purchases of nonmetallic minerals have shown the greatest increases for refractory materials and clays, thanks to the expansion of CAP's steel Table 3. — Imports of Mineral Products, by Commodity Groups and Principal Commodities, Total and From the United States, 1964 [Thousands of dollars] Tariff number Description Imports United Total States Group 1 Ores, crude or simply worked; pure 6,819 2,322 metals. 4-001 Aluminum, in ingots 1,336 956 8-001 Tin, in ingots 2,283 23 11-002 Ferrochromium 105 82 17-001 Lead, in ingots 489 109 -002 Lead alloys, in ingots 59 45 19-001 Zinc, in ingots 2,314 1,044 Group 2 Nonmetallic minerals, crude or 4,009 2,952 simply worked. 21-001 Clays for laying refractory brick .... 52 40 -002 Refractory clays for smelters 18 16 -003 Fuller's earth, industrial 42 24 -004 Clays, other than kaolin or 315 187 white clay, n.e.s. -005 Bentonite 149 103 -011 Refractory compositions, with 134 11 clay, in powder. 26-003 Calcined magnesite, impure 734 626 -004 Refractory dolomite 869 869 28-001 Abrasives and infusorial earths 116 43 to -011 such as Kieselgur which can be used as abrasives. 29-001 Graphite or black lead 38 12 31-001 Guano, natural 223 1 43-002 Dolomite, natural 584 544 -004 Feldespar 48 ' -008 Phosphoric anhydride ores 209 209 -009 Fluorspar 47 * -020 Sulfur ores 187 187 Group 4 Coal and mineral fuels 23,730 9,393 43-042 Coal, in bulk 5,403 5,403 -049 Natural crude petroleum for 1,988 288 refining in Chile. -050 Petroleum for the Chilean Navy.... 1,238 509 -051 Crude petroleum 10,111 2,369 -052 Petroleum for steam boilers 280 166 -053 Road oil 245 104 -054 Petroleum for diesel engines 4,452 543 All commodity groups, total 34,558 14,667 Listed principal commodities, 34,068 14,512 total. Principal commodities as per- 98.6 98.9 cent of total all commodity groups. 1 Equals zero or less than $1,000. Source: Camara de Comercio, Comercio Exterior, Chile, 1964, Santiago, 1965. Note: Principal commodities include all items for which total imports exceed $30,000, or imports from the United States exceed $15,000. 28 making facilities and the growth of metals fabrication. Imports of clays and refractory materials other than dolomite and calcined magnesite (21-001 through 21-011) totaled 7,239 tons in 1964. The great number of small clay diggings and backyard industries using clay and clay products in Chile makes an accurate estimate of production and consumption difficult, as is the case also for kaolin, quartz, feldspar, and con- struction materials other than cement. Ministry of Mines data on these products is collected from ques- tionnaires sent to known significant producers who normally work only a small portion of active prop- erties. Industrial clay production is limited mostly to the Concepcion area where beds of high-grade material underlie the coal horizons while clay used for house- hold articles is scattered throughout Chile. Total pro- duction reported for 1963 was 28,294 tons, with production estimated for 1964 at 18,825 tons. The three known producers of feldspar produced 636 tons in 1964. Chile's limestone reserves are well distributed throughout the length of the country and are sufficient to satisfy all conceivable needs in the future. Guano imported from Peru is mixed with other fertilizer materials to produce enriched ferti- lizers. The importation of sulfur ores is not expected to increase since the recovery of sulfur from fumes of copper smelters and of plants roasting pyritic materials is expected to supplement an expected in- crease in domestic production. Sulfur is needed for sulfuric acid by copper, fertilizer, and other industrial facilities. Natural Forest Products This tariff category includes synthetic rubber as well as unworked lumber, natural rubber, latex, cork, and other raw forest products. Imports in the years 1961-64 averaged $4.9 million annually, with those from the United States averaging $2.0 million. Table 4 shows Chilean imports of natural forest products, by commodity groups and principal commodities, total and from the United States in 1964. Synthetic and natural rubber are the most important imports in this category, with 4,350 and 3,111 tons of those materials, respectively, imported in 1964. The United States was the principal supplier of syn- thetic and the United Kingdom the principal supplier of crude rubber in that year. The greatest part of this was consumed by the Industria Nacional de Neu- maticos, S.A. (INSA), in which the General Tire and Rubber Company is a participant. INSA, currently the only producer of tires and inner tubes in Chile, has announced plans for increasing its tire-production capacity from 570,000 to 1,150,000 units annually. In addition, the Firestone Tire and Rubber Company recently revealed plans for producing tires in Chile. Chilean forests provide all but a negligible portion of the country's lumber needs. Thirty-seven percent of total lumber production in 1964 was accounted for by the Pino Insigne ( Pinus Radiata or Monterrey Pine). Imports in the recent past have been confined to timbers of extra long and large dimensions — usually Douglas fir or redwood — for use by the mining in- dustry. Chile has demonstrated interest in developing tree plantations seeded with species common to the U.S. Northwest, such as the Douglas fir. Table 4. — Imports of Natural Forest Products, by Commodity Groups and Principal Commodities, Total and From the United States, 1964 [Thousands of dollars] Tariff number Description Imports United Total States Group 5 Unworked wood 87 55 47-001 Pine lumber, unworked 69 53 Group 6 Other forest products 6,332 2,033 50-001 Common charcoal, from wood 36 36 -002 Molded charcoal, from wood 37 34 51-001 Carnauba wax 84 3 -002 Synthetic wax for industrial use .... 92 25 52-001 Cork, in slabs 498 1 -002 Cork, shredded 106 57-001 Natural rubber, crude 2,282 59 -002 Grooved or smoked rubber, natural 149 2 -003 Synthetic rubber 2,296 1,741 -004 Natural latex 374 1 -005 Polybutadiene-styrene 103 -011 Rubber, from synthetic latex 117 109 59-001 Rubber, residues or reclaimed 84 12 All commodity groups, total 6,419 2,088 Listed principal commodities, total 6.327 2,076 Principal commodities as per- cent of total all commodity groups 98.6 99.4 1 Equals zero or less than $1,000. Source: Camara de Comercio, Comercio Exterior, Chile, 196i, Sanitago, 1965. Note: Principal commodities include all items for which total imports exceed $30,000, or imports from the United States exceed $15,000. Animal Products (Unmanufactured) Imports of unmanufactured animal products have increased substantially both absolutely and as a per- centage of total imports during recent years. Thus, in the first half of the last decade total imports hovered around a $10-million annual average while accounting for an average 2.6 percent of the market. However, in the years 1960-64, imports of animal products averaged $33 million annually, or 5.7 percent of total imports. Table 5 shows Chilean imports of unmanu- factured animal products, by commodity groups and principal commodities, total and from the United States in 1964. Live animals account by far for the largest portion of animal product imports; the portion was 74 per- cent in 1964, a representative year. Argentina sup- plied 99 percent of such imports, mostly cattle, with the United States supplying the remainder. $120,000 29 worth of chickens. However, the outlook for selling U.S. cattle appeared to be improving in the latter part of 1965 as more Chileans became convinced of the quality of U.S. stock. Purchases of breeding cattle under a $19 million World Bank loan were to total between 33,000 and 55.000 head during the years 1966-68, with about 85 percent of these to be Here- fords and 15 percent Holsteins. Some 11,000 have already been purchased, about half from Argentina, and the remainder from New Zealand, Australia, and Canada. About $15 million remains to be disbursed. Table 5. — Imports of Animal Products, by Commodity Groups and Principal Commodities, Total and From the United States, 1964 [Thousands of dollars] Tariff number Description Imports United Total States Group 8 Fishery products 17 1 Group 9 Live animals 27,740 120 82-003 Chickens and other fowls 156 120 83-001 Cattle, male, older than 6 months.. 26,642 ' -002 Cattle, female, older than 6 months 257 * -004 Breeding cattle 482 J 84-004 Horses, for breeding 42 * 86-001 Sheep 80 » -002 Pedigree breeding sheep 54 Group 10 Wool and other textiles of animal 5,974 9 Origin, crude. 93-001 Sheep wool, washed 1,759 -003 Wool tops 4.141 1 Group 11 Hides and skins and animal offal, 3,080 crude. 95-004 Bone meal 118 1 96-004 Sheepskins, with hair, untanned.... 31 -005 Cattle hides, with hair, untanned.. 2,878 Group 12 Aviculture, apiculture, and 610 49 sericulture. 104-002 Silk floss or waste 589 48 All commodity groups, total .... 37,421 179 Listed principal commodities, total 37,229 168 Principal commodities as per- cent of total all commodity groups 99.5 93.9 1 Equals zero or less than $1,000. Source: Camara de Comercio, Comercio Exterior, Chile, 190 k, Santiago. 1965. Note: Principal commodities include all items for which total imports exceed $30,000, or i.nports from the United States exceed $15,000. The Empresa de Comercio Agricola (ECA), gov- ernment purchasing agency, was considering the im- portation of a trial shipment of feeder cattle from the United States for fattening during the Chilean fall, winter, and spring growing seasons. If economically successful, Chile might import 10,000 to 20,000 head of feeder cattle each year. Imports of about 25,000 ewes and 1.200 rams over a three-year period were being considered. The World Bank loan was also to finance imports of breeding hogs and sheep. The $19 million World Bank loan calls for the improvement of 825,000 acres of pastureland and the acquisition of machinery, materials, and breeding stock to help develop the livestock industry. Comple- menting the loan was another for $5 million to mod- ernize and expand milk plants and slaughterhouses and associated facilties. The local borrowers are free to select the makers of agricultural machinery and the materials they prefer. The type of cattle will be selected jointly with Chilean farmers associations or stud breeders societies. The Chilean Government, in an effort to raise the meat protein consumption levels of the population, has sought to promote the consumption of chicken, a much cheaper source of protein than the now favored beef. Thus, the Government ordered the delivery of 200,000 baby chicks in late 1965 as an aftermath of meat- shortages produced by the disastrous floods of that year. As a second step, COBFO approved loans total- ing $102,000 plus 917,000 escudos to be used pri- marily to increase broiler production, to increase and improve the production of feed concentrates, and to enlarge a poultry slaughterhouse located near Santiago. The Chilean Government with the support of AID has been promoting the production of both chickens and hogs by farmer cooperatives. Chilean imports of hides and skins have increased in recent years, with nearly all of Chile's require- ment met by Argentina. Negligible amounts of fish and silk are imported. Chilean wool imports usually account for only 3 to 4 percent of total supply. Generally, these imports are special types, such as Merino over 64's, which are not available in Chile in sufficient quantity to support production of high quality textiles. Annual import requirements have remained steady in recent years at about 1,100 tons (grease basis). Agricultural Products While Chilean agricultural production is sufficient to supply the bulk of domestic needs and to support exportation of several products, there has been a growing dependency upon imports. Imports of basic agricultural products averaged $61.7 million annually during 1960-64, ranging from 7.1 to 15 percent of total imports. Cotton and wheat accounted for 57.5 percent of imports in that category in 1964, and the addition of coffee and tea raises that figure to 75.5 percent. Table 6 shows Chilean imports of agricul- tural products by commodity groups and principal commodities, total and from the United States in 1964. The United States in recent years has maintained its position as the leading supplier of basic agricul- tural products (34.1 percent in 1964) because of its predominance in wheat sales. Peru has held second place recently, although Mexico moved ahead in 1964. Most of their sales consist of cotton. 30 Table 6. — Imports of Agricultural Products, by Com- modity Groups and Principal Commodities, Total and From the United States, 1964 [Thousands of dollars] Tariff number Description Imports United Total States Group 13 Live plants and seeds 1,013 704 108-001 Alfalfa seed 338 304 112-001 Clover seed 166 63 113-006 Rye seed 54 33 -016 Grazing grass seed 180 124 -021 Seeds for agriculture, n.e.s., other than vegetables, barley, and melons 241 156 Group 14 Cereals 20,078 16,987 114-001 Rice, hulled or not, also if crushed 2,158 170 -011 Rice, milled (bleached) 1,431 1,197 120-001 White wheat 16,479 15,611 Group 15 Legumes 4 4 Group 16 Fruits and vegetables 3,618 15 138-013 Fresh avocados 96 » -015 Fresh pineapple 144 1 -016 Fresh bananas 3,249 1 -017 Fresh watermelons 38 * Group 17 Vegetable food products, stimulants 14,326 317 144-001 Cocoa, crude or in the bean, husked or not 695 * 145-001 Coffee, in the bean 5,692 1 149-001 Hops 267 256 150-001 Tea, in bulk or packed in quanti- 5,331 58 ties of more than 5 kilograms. 151-001 Tea, in paper or cardboard packets 63 1 153-001 Yerba mate 2,251 Group 18 Spices 173 15 159-001 Cinnamon, whole 41 x 165-001 Pepper, whole 87 » Group 19 Forage and animal feeds, n.e.s 3 2 Group 20 Raw textile materials of vegetable origin 19,476 293 172-001 Cotton, crude, ginned or not 19,066 275 175-007 Henequen fibers and roots 37 1 -012 Sisal fibers, undyed 73 a -013 Tampico fibers, undyed 36 3 -014 Zacaton fibers, undyed 55 ' -017 Jute fibers, crude and undyed 181 Group 21 Oleaginous vegetable materials, crude 56 182-010 C-stor beans 40 * Group 12 Tobacco, crude 3,048 2,758 183-001 Leaf tobacco, pressed or not 3,048 2,758 All commodity groups, total 61,795 21,095 Listed principal commodities, total 61,537 21,011 Principal commodities as percent of total all commodity groups 99.6 99.6 1 Equals zero or less than $1,000. Source: Camara de Comercio, Comercio Exterior, Chile, 196i, Santiago, 1965. Note: Principal commodities include all items for which total imports exceed $30,000, or imports from the United States exceed $15,000. In order to stem the rising tide of import require- ments, the Chilean Ministry of Agriculture has pre- pared a program which is designed to make Chile eventually self-sufficient in wheat. The objective is to increase yields with improved farming techniques rather than to increase the area seeded. The program is based on the following projection of production and demand in the coming years: Year Production Demand Deficit (1.000 tons) 1966 1,320 1,675 355 1967 1,345 1,720 375 1968 1,365 1,765 400 1969 1,390 1,820 430 1970 1,410 1,860 450 Bad weather during 1964-65 resulted in larger than usual imports of wheat in 1965 and 1966. Wheat im- ports totaled 277,751 tons in 1965, of which 171,483 tons were from the United States (43,533 tons under PL-480), and 106,268 tons from Argentina. An esti- mated 440,800 tons may be imported in 1966. This would include 45,512 tons purchased under PL-480 in 1965 scheduled to arrive in 1966, an additional ship- ment of 131,689 tons authorized by the 1965 PL-480 agreement, and 263,598 tons to be obtained from com- mercial sources and a new 1966 PL-480 agreement. Chilean wheat imports totaled 401,608 tons (26,087 from the United States) in 1963 and 222,410 tons (208,140 from the United States) in 1964. Imports from the United States included 12,151 tons under PL-480 title IV in 1963, and 19,562 tons in 1964. The 1965 title I agreement also provides for the importation of 55,100 tons of corn, with most of this earmarked for the poultry industry. Only 14,326 tons were imported in 1964 under title IV. An estimated 12.825 tons were imported in 1965, while a total of 110,200 tons is forecast for 1966. During 1964, Chile imported 15,313 tons of rough rice ( almost all from Spain ) into central Chile and 9,188 tons of milled rice (almost all from the United States) into the northern and southern free ports. About 27.550 tons (rough grain equivalent) was ex- pected to be imported in 1965 (13,224 from the United States), and an equal amount is expected to be imported in 1966. Chile has not exported a substantial amount of rice since 1962 and is not expected to do so in the next few years. The Llnited States is no longer a leading supplier of cotton in the Chilean market. Mexico and Peru are now Chile's primary suppliers. The last year in which the United States registered substantial sales was 1963 when U.S. sales amounted to $4.3 million ($3.4 million under PL-480 title IV). The bulk of tobacco used in domestic manufac- tures is grown in Chile, and import requirements are not expected to increase significantly in the next few years. Total imports of unmanufactured tobacco in 1963 were 2,308 tons and in 1964 were 1,403 tons. The United States supplied 1,632 and 1,241 tons in those years, with shipments under PL-480 (title IV) accounting for 353 and 661 tons. The October 1965 PL-480 agreement (title I) will supply 771 tons of 31 tobacco with the understanding that Chile import at least 441 tons from normal commercial sources, in- cluding 325 tons from the United States. Total imports in 1965 were expected to reach 1,433 tons, with 1,146 coming from the United States. On severance of trade relations with Cuba in 1964, Chile sought other sources for cigar tobacco. The Compania Chilena de Tabacos is the sole importer of unmanufactured tobacco ; it supplies smaller firms with semifinished tobacco for the manufacture of cigars and pipe tobacco. The company is the sole producer of cig- arettes and the only major producer of cigars and pipe tobacco. Chilean brewers continue to depend entirely upon imported hops, since that crop is not produced com mercially in Chile. Although the Government continues to set limits on beer production, output has seldom ap- proached these production ceilings in recent years. Thus, 1964 production was only 43 percent of the quota. The Compania de Cervecerias Unidas has been alloted 97.3 percent of the 1965 quota, with the re- mainder assigned to 5 independent brewers. Hops imports in the years 1963-64 were 199 and 207 tons (gross weight) and were expected to total 240 tons in 1965. The United States is expected to continue as the principal supplier of hops. The Government's program to increase livestock production should open possibilities for increased sales of seeds in development of pastures. Chilean imports of unprocessed fruits, vegetables, food stimulants, spices, and oleaginous vegetable ma- terials are almost entirely composed of tropical products. Manufactured Food Products After declining from a high of 12 percent of total imports at the beginning of the 1955-64 decade to 6 percent in 1960. manufactured food products have steadily grown in importance and represented 8.8 percent of all imports ($53.6 million) in 1964. The increases largely reflect the failure of domestic pro- duction to keep up with demand, particularly for sugar, meat, and dairy products. Imports of edible fats and oils have remained fairly stable in recent years, as have prepared and preserved foodstuffs which have actually registered declines because of the operation of import restrictions. Table 7 shows Chilean imports of manufactured food products, by commodity groups and principal commodities, total and from the United States in 1964. Peru emerged as the leading supplier ($18.2 mil- lion) of manufactured foodstuffs in 1964 by supplant- ing Cuba as the principal supplier of sugar to Chile. Argentina followed closely in 1961, with sales aver- aging $10.6 million annually during 1961-64, owing 32 Tariff number Description Imports United Total States to its position as the leading supplier of meat to the Chilean market. Table 7. — Imports of Manufactured Food Products, by Commodity Groups and Principal Commodities, Total and From tbe United States, 1964 [Thousands of dollars] Description Group 24 Meats, including jerked and salted.. 8,257 8 184-002 Fresh or chilled beef 7,742 1 -006 Frozen beef 235 189-011 Edible offal 228 Group 25 Edible fats and derivatives 2,532 471 190-001 Edible fats 767 328 191-001 Lard 1,632 14 192-001 Margarine and its imitations 101 99 Group 26 Milk, cheese and butter 5,450 4,237 196-001 Condensed milk 154 1 197-001 Milk, pure, powdered 2,865 2,747 198-001 Butter or butter fat 2,362 1,450 199-001 Cheese, common 32 27 Group 27 Starch, flour or meal, and residues .. 3,074 2,909 202-001 Oats, hulled 50 50 -003 Cooked wheat 265 265 -005 Grain, crushed or semi-ground, n.e.s 147 147 205-001 Cornmeal 360 360 206-001 Wheat flour, in packages of more than 5 kilograms 2,095 1,968 207-007 Flour and meals of grains, n.e.s 74 62 Group 28 Edible oils 5,028 3,506 212-001 Cottonseed oil 69 31 -002 Sunflower or marigold oil 26 23 -003 Olive oil 39 2 -004 Soybean oil 2,869 1.534 -005 Edible vegetable oils, n.e.s 257 149 -Oil Semirefined vegetable oil for manufacture of edible oils 980 980 213-001 Coconut butter 353 352 -003 Butter, n.e.s., other than peanut. ... 433 433 Group 29 Preserved and prepared foods 805 151 214-001 Cacao, ground, unsweetened 49 219-001 Preserved meat, n.e.s 42 8 220-001 Preserved fruits, sweetened 32 15 223-001 Preserved vegetables, leguminous, leafy and root 30 16 227-001 Preserved soups, n.e.s 72 18 228-001 Chocolate, paste (nonconfectionery) 35 229-001 Chocolate, candies, and bonbons .. 88 7 230-001 Candies and confectionery, n.e.s... 68 10 231-001 Meat extracts and juices 117 ' -002 Meat extract, paste form 51 236-001 Powder, without gummy sub- stances for pastry-making 38 29 Group 30 Sugar and derivatives 28,465 261 243-001 Raw sugar, 85% to 97% saccharose 26,132 246 245-001 Refined sugar, more than 98.5% saccharose 2,303 All commodity groups, total 53,611 11,543 Listed principal commodities, total 53,192 11,370 Principal commodities as percent of total all commodity groups 99.2 98.3 1 Equals zero or less than $1,000. Source: Camara de Comercio, Comercio Exterior, Chile, 1961,, Santiago, litGfj. Note: Principal commodities include all items for which total imports exceed $30,000, or imports from the United States exceed $15,000. The United States was a close third in 1964, and it boasted average annual sales of $10.5 million in the years 1961-64 consisting primarily of powdered milk, edible oils, and wheat flour — all strongly sup- ported by PL-480 sales. The United States is not a significant supplier of either sugar or meat, the two largest groups in this category. The Chilean Government's desire to replace expensive beef imports with a cheaper source of pro- tein, and the decline in local production of beef and veal resulting from poor weather in the spring of 1965 resulted in the first significant imports of frozen chickens in recent years by the ECA — perhaps 2,755 tons, with about 90 percent coming from the United States. Reduced cattle and beef imports from Argen- tina has lead to the imposition of a ban on beef sales Monday through Thursday. Chile imports edible vegetable oils to cover short- falls in domestic production. The imports are derived mainly from rape and sunflower seeds. Imports of crude, semirefined, and refined edible vegetable oils totaled 26,228 and 15,953 tons (refined basis) in 1963 and 1964, respectively, and were expected to total 17.066 tons in 1965, with about 5,510 tons of this refined. Refined vegetable oil imports are permitted only into the freeport areas. The largest U.S. sales item in this category was soybean oil, and PL-480 title IV sales accounted for about 75 percent of its value. The 1965 title I agreement did not include a PL-480 soybean oil component. It did provide for the importation of 1,102 tons of butteroil and stipulated that Chile would take, in addition 5,510 tons of butter, butteroil or anhydrous milk fat in 1965. The United States sup- plies less than a fifth of Chile's importation of edible fats and their derivatives: Argentina supplies more than three-fifths. The United States accounted for nearly 80 percent of Chile's dairy product imports, primarily through its sales of powdered milk and butterfat, with the latter supported in part by PL-480 title IV sales. The 1965 PL-480 title I agreement called for the importa- tion of 4,408 tons of powdered milk from the United States, and it was thought that Chile would require an additional 12,122 tons of commercial imports. A considerable portion of Chile's wheat flour im- ports from the United States was supported by PL-480 sales. Beverages and Manufactured Tobacco Importations of beverages and manufactured to- bacco products have been negligible in past years because of substantial domestic production of such products and restrictions on the importation of non- essential goods. Table 8 combines these two major Chilean tariff categories to show Chilean imports of beverages and manufactured tobacco, by commodity groups, total and from the United States in 1964. Table 8. — Imports of Beverages and Manufactured Tobacco, by Commodity Groups, Total and From tbe United States, 1964 [Thousands of dollars] Tariff number Description Imports United Total States Group 31 Wines 23 Group 32 Spirits and liqueurs 334 16 Group 33 Beer and cider 1 Group 34 Mineral waters and other nonalcoholic beverages 35 17 Group 35 Prepared tobacco 3 2 Group 36 Cigars and cigarettes 31 23 All commodity groups, total 427 58 1 Equals zero or less than $1,000. Source: Camara de Comercio, Comcrcio Exterior, Chile, 1H6J,, Santiago, 1965. Manufactured Textiles The textile industry, one of Chile's oldest and most highly developed, supplies by far the greater part of the country's demand. Most imported textile manufac- tures are either prohibited entry into most of Chile or are subject to high customs charges. While the domestic industry constitutes a sizable market for imported raw materials, such as cotton, wool, and synthetic materials, textile manufactures constitute a quite small import category. In only one year of the 1955-64 decade did they constitute more than 4.5 percent of total imports (1962: 6.2 percent), and they represented only 2.7 percent in both 1963 and 1964. Table 9 shows Chilean imports of textile products, by commodity groups and principal commodities, total and from the United States in 1964. Hemp or jute bags, cord fabric for the manufacture of tires, and men's and boys' madeup clothing of cot- ton and wool, together represented more than 50 per- cent of textile imports in 1964. Most of these items (except for sacks for the nitrate and fishmeal indus- try) are imported into the Valparaiso-Santiago area, but a very high proportion of products, such as yarns, trimming, and nonwool wearing apparel, flow primar- ily into the free ports. Many such imports are prohib- ited entry into the rest of the country or are subject to severe import charges. The sharp decline in the im- portation of wearing apparel from $11.5 million in 1961 to $3.6 million in 1964 reflects the increasing severity of those restrictions. The United States, during the past decade, has been the principal supplier of manufactured textiles to the Chilean import market, maintaining its position in recent years by virtue of its sales of cord fabric for the manufacture of tires and wearing apparel I primarily men's and boys' made-up wool clothing ) . India's grow- ing sales of sacks, particularly to the nitrate and fish- meal industries, have boosted it to the position of sec- ond supplier, while the United Kingdom and the 33 Table 9. — Imports of Textile Products by Commodity Groups and Principal Commodities, Total and From the United States, 1964 [Thousands of dollars] [Thousands of dollars] Tariff number Description Imports Total United States Group 37 276-002 ■005 -006 282-001 289-002 -005 -006 Group 38 294-001 299-001 299-011 Group 39 306-001 330-001 358-001 363-001 -017 -023 -028 392-001 393-001 395-001 396-001 397-001 Group 40 419-002 -003 -004 -005 -006 Yarns 1,900 189 Artificial silk yarns, rayon, single strand 852 70 Nylon yarns, single strand 206 19 Acetate yarns, single strand 76 51 Threads and yarns of cotton, n.e.s. 62 13 Threads and yarns of artificial silk 395 2 Threads and yarns of nylon 193 16 Threads and yarns of glass, n.e.s... 33 2 Cordage 596 94 Cordage and cord of hemp or manila, weighing 75 to 600 grams per 10 meters 56 1 Cordage and cord of hemp or manila, weighing over 600 grams per 10 meters 237 20 Twists of nylon or other artificial fibers, weighing over 600 grams per 10 meters 265 63 Fabrics 3,441 2,486 Oilcloth and linoleum for floors.... 40 3 Damasked fabrics, of cotton, for bedspreads, etc 30 1 Cord fabrics, of cotton or rayon, for manufacture or repair of tires 2,373 2,335 Cotton fabrics, unbleached, plain, n.e.s., with or without mixture of hemp, jute or other similar fibers or containing linen or wool in a total proportion not exceeding 10%, weighing 80 grams or more per square meter, and having 27 threads or less in an area 5 milli- meters square: Unbleached grey cloth (tocuyo) 23 18 Bleached, n.e.s., other than linen, organdy, pique, and poplin 65 24 Percales and percalines 32 13 Dyed or printed, n.e.s., other than cretonne, organdy, pique, or poplin 105 27 Fabrics, n.e.s., of wool or of vege- table fibers, containing more than 10% of wool, with or without threads of base metal: Weighing per square meter, up to 250 grams 73 ' Weighing per square meter, more than 250 grams 157 2 Containing up to 20% silk 42 ] Containing 20% to 80%, silk .... 40 4 Containing 80% or more silk.... 30 25 Bags and packings 3,823 74 Empty bags, of hemp or jute: For grain 534 ' For minerals or metals 144 1 For potatoes 198 ' For nitrates 1,343 J For other products 1,576 73 Tariff number Description Imports Total United States Group 41 Trimmings and ribbons 110 37 428-001 Cotton ribbons 31 11 438-001 Cords of wool, containing 80% or more silk 53 16 Group 42 Wearing apparel 3,555 2,367 492-001 Cotton shirts, for men or boys 261 13 554-001 Umbrellas, containing silk 44 x 567-001 Madeup clothing of fabric water- proofed by means of rubber or its substitutes, containing silk .. 31 15 568-001 Knitted cotton underwear 46 8 Madeup clothing, n.e.s., for men or boys, and detached parts there- of with needlework: 580-001 Of cotton 838 726 584-001 Of wool 1,252 1,143 587-001 Containing less than 80% silk .. 62 27 Madeup clothing, n.e.s., for wom- en, girls or infants, and detached parts thereof with needlework: 589-001 Of cotton, with or without orna- ments of cotton or other ma- terials, not being insertions, lace or embroideries 420 258 590-001 Of cotton, ornamented with in- sertions, lace or embroideries of cotton or other material .... 88 1 591-001 Of cotton, with ornaments or embroideries containing silk .. 28 26 595-001 Of wool, with or without orna- ments of wool or other ma- terials 143 37 597-001 Containing less than 80% silk .. 100 55 Group 43 Household wares of textile materials 305 76 632-001 Carpets and floor coverings of wool and other materials, n.e.s., other than of hemp or similar fibers, animal hair, cotton, looped wool, linoleum or oilcloth 73 17 669-001 Cotton tablecloths, napkins, and table linen sets, with embroid- eries or lace, except silk 43 1 683-001 Towels, up to 1 meter square, of cotton 43 4 Group 44 Manufactures of textile materials, n.e.s 493 438 698-001 Filters with or without parts of other materials 430 411 All commodity groups, total 14,223 5,761 Listed principal commodities, total 13,166 5,551 Principal imports as percent of total all commodity groups 92.6 96.4 1 Equals zero or less than $1,000. Source: Camara de Comercio, Comercio Exterior, Chile, 106/,, Santiago, 1965. Note: Principal commodities include all items for which total imports exceed $30,000 or imports from the United States exceed $15,000. Items reported as containing silk probably include artificial silk or silk substitutes. 34 Federal Republic of Germany (West Germany) fol- low closely with sales scattered throughout the various subdivisions of textile manufactures. In addition to cotton, the industry's principal raw material imports are sulfite-grade chemical pulp, rayon-grade caustic soda, dyes, titanium dioxide, and lead. There are two cellulosic rayon and two non- cellulosic nylon (polyester) fiber producing plants. Production of manmade fibers in 1964 was 11.5 mil- lion pounds, as follows: rayon-acetate yarn, 4.3; rayon-acetate staple, 5.9; and noncellulosic yarn, 1.3. The industry is composed of two main groups: spinning and weaving mills turning out 80 percent of total production; knitting mills, 15 percent; and manufacturers of sewing thread, rope, sacks, twine, cotton and elastic ribbons, 5 percent. Installed capa- city for 1964 was 362,000 spindles and 9,500 looms. Continuous filament and staple fiber are produced in Chile by the viscose process. Cupramonnon for mixing with wool and synthetic fibers, such as Dacron and acrilan, is imported in limited quantities. Produc- tion consists of solid-colored fabrics, patterned and print pure rayon fabrics, mixed rayon and cotton fabrics, and mixed rayon and wool fabrics. Both piece goods and trimmings are produced. The major part of the spinning equipment in the carded wool, linen and jute factories antedates World War II. The same is partially true of the weaving machinery used in the wool, rayon, and jute industries, and of most of the equipment in knit goods plants. Equipment in the cotton textile industry is generally much more modern. The same is true for the combed wool, silk hosiery, and ribbon segments of the industry. Chemicals and Related Products Chemical products are ordinarily among the three most important Chilean import categories, usually surpassed only by machinery and transportation equipment, except when poor crop years result in large imports of unmanufactured agricultural products. During the 1955-64 decade, chemicals accounted for as much as 17.4 percent of total imports and as little as 8.9 percent, usually ranging between 12 and 15 percent. The United States has traditionally been the prin- cipal supplier of chemical products to the Chilean market, accounting for more than 50 percent of such sales each year through 1960. The U.S. share of the market has declined in recent years, while West Ger- many has experienced the most significant growth in sales. In 1964, the United States claimed 42 percent of the market, while West Germany averaged 20 percent for the years 1963-64 — a rapid climb from the mid- 1950's when it claimed less than 10 percent of the market. The United Kingdom has usually occupied the third position with a rather steady 7 percent of chemical imports. Table 10 shows Chilean imports of chemicals and related products, by commodity groups and principal commodities, total and from the United States in 1964. The Chilean chemical industry is comprised of two principal groups. The first is based upon the mining and processing of chemical raw materials from Chile's ample resources of copper, nitrates, iodine, limestone, salt, borax, sulfur, and other minerals. The second has become the fourth most important industry in Chile, producing industrial chemicals, drugs and medi- cines, paints and varnishes, and allied chemical prod- ucts. The majority of chemical plants are small, but there are several large and important installations producing explosives, pharmaceuticals, botanicals, fertilizers, and soaps and detergents. By far the largest part of output from this group is derived from the production of soaps and detergents, pharmaceuticals, and paints and varnishes. Industrial chemicals prob- ably account for about 20 percent of output. The chemical industry draws its raw-material needs primarily from the by-products of the steel (naptha- lene. benzols, and anthracene), sugar beet refining (ethanol and acetic acid), and petroleum (paraffin, liquid gas, and synthesized gas) industries, and from the processing of sulfur and sodium chloride. Chile is now moving briskly toward the establish- ment of a petrochemical industry following the com- pletion of a feasibility study by the Fluor Corporation in late 1965. This expansion aims at supplying the domestic market — petrochemical imports exceeded $22 million in 1964 — but also assumes access to the LA FT A market. The plan involves projected invest- ments of about $110-1120 million — half to be supplied by the State and the remainder by domestic or foreign capital — and envisages the construction of the follow- ing installations (millions of dollars) : Ethylene complex $ 8.0 Sodium chlorite 6.0 Polyethylene 8.0 Derived chlorides 5.0 Polyvinylchloride 3.5 Acetaldehyde and derivatives 30.0 Ammonium complex Ammonia 20.0 Fertilizers 15.0 Aromatic complex Aromatic separations 4.0 Phthalic anhydride 3.5 Phthalic plastics and resins 1.0 Resins and polyester chips 6.5 "Caprolactoma" 11.0 Increased Chilean production of petrochemicals is not expected to diminish overall U.S. sales but should create markets for more diversified products. The only identifiable categories for which the United States supplies more than a million dollars, and which are potential targets for substitution, are fertilizers, syn- thetic resins, carbon black, and synthetic rubber. Only 35 Table 10.- -Imports of Chemicals and Related Products, by Commodity Groups and Principal Commodities, Total and From the United States, 1964 [Thousands of dollars] [Thousands of dollars] Tariff number Group 45 712-001 718-001 722-001 731-001 713-001 to 731-001 732-02-1 732-003 to -050 733-001 736-001 737-002 738-001 to -011 750-001 751-001 -011 752-021 754-001 758-001 -002 -003 762-014 764-007 761-001 to 764-030 771-011 -021 773-011 781-002 783-001 799-002 800-002 809-002 -003 -004 -011 -010 824-001 to -008 832-011 838-002 -011 847-001 to -018 -021 -031 -033 -034 -035 -036 -040 -041 Description Imports United Total States Chemicals 22,881 Acetone 35 Citric acid 83 Phosphoric acid 56 Amino acids 49 Acids, n.e.s. 1 122 Ergotoxine and alkaloids of rye ergot 49 Alkaloids and their compounds, n.e.s., other than theobromine 2 .. 311 Caffeine 46 Butyl alcohol 35 Octyl alcohol 181 Alcohols, n.e.s., other than allyl, benzyl, capryl, cetyl, cinnamic, propyl, and absolute ethyl 285 Aluminum hydroxide 24 Amyl acetate 44 Dibutyl phthalate and dibutyl maleate for industrial use 109 Methyl methacrylate monomer .... 306 Anhydrous ammonia, in cylinders 57 Ammonium hydrochlorate or chloride 114 Ammonium nitrate 1,765 Ammonium sulfate 36 Salophene 31 Aspirin 218 Analgesics, anesthetics, antipy- retics, sedatives, and com- pounds, n.e.s., other than chloral and chloroform 4 812 Freon gas, in iron cylinders 185 Gases for medical or industrial use, other than sulfurous an- hydride, not specified 80 Phthalic, maleic, tetrahydro- phthalic and trimethylic anhydrides for industrial use .... 107 Glucose 27 Sulfur, whole, ground or sublimated 525 Calcium carbonate, pure 49 Calcium phosphate, pure 70 Toluene 43 Xylol 38 Dodecylbenzene 115 Styrene monomers 254 Hydrocarbons, n.e.s., other than naphthalene, unsaturated acyclic hydrocarbons and xylene 126 Diastases and vitamins 588 Vinyl acetate monomers 160 Cresol 6] Biphenyl, butylphenol and amyl- phenol for industrial use 30 Glycosides, opotheraputics and various extracts ]J86 Concentrated bile 22 Penicillin 205 Streptomycin 100 Terramycin 180 Acromycin 33 Chloramphenicol 43 Antibiotics, n.e.s 1,387 Levorotatory compounds for the synthesis of Chloromycetin 207 Tariff number Description Imports United Total States ',300 Group 45 11 -051 2 41 869-011 22 905-001 908-007 910-002 38 923-002 -003 22 -004 -006 30 924-003 2 -004 16 929-001 133 930-001 944-001 954-001 125 -002 24 -004 44 -005 -007 3 -008 173 -009 15 -010 -013 87 -014 153 -016 1 -017 3 -018 89 -019 -020 -021 -022 -023 102 -024 73 -999 35 Group 46 961-011 24 23 968-001 972-001 9 973-001 45 977-001 41 35 994-011 115 1001-001 250 1009-001 -002 125 1011-001 207 8 1014-001 56 -011 -014 166 20 -020 9 1 33 8 1032-001 267 to -010 -015 118 -019 -continued Methyldichloroacetate, pure or synthetic Magnesium hydroxide Litharge of lead Caustic potash Potassium chlorate, impure Sodium bichromate Sodium chlorate, pure Sodium phosphate Sodium tripolyphosphate Calcined sodium carbonate Caustic soda, impure Sodium cyanide Sodium hydrosulfite Urea Acids, not specified Acetates, not specified Antihistamines Optical bleaching agents Chlorohydrates, not specified Developed colors Compositions for coloring plastics Silicon dioxide and silicates Additives for lubricants and oils .. Synthetic resin latex Oxides, not specified Plasticizers Preparations for fluorescent tubes Ion exchangers Water-treating products Products based on lignosulfonates Resins, stabilizers and additives for the same Silicones Surface-active agents such as emulsifying and wetting agents, and detergents Chemical products, not specified .. Medicinal drugs, pharmaceuticals and toilet preparations Gauze and dressings for medical use First-aid kits Gelatin capsules for medicines, empty Charcoal, vegetable, in powder .... Catgut and similar products for sutures Antituberculin drugs, not specified Medicinal extracts, not specified .. Medicines in the form of drops (accompanied by dropper) Injection solutions, not specified.. Powdered flours and preparations, without powdered milk, for feeding infants or invalids Hypodermic injections, in am- poules, not specified Aureomycin for hypodermic injections Terramycin for hypodermic injections Antibiotic injections, n.e.s., other than streptomycin, penicillin, acromycin and Chloromycetin .. Pastilles, comprimes, tablets, tab- loids, pills, drops, capsules, etc.: Medicines, other than antibiotics Streptomycin Acromycin 229 45 18 56 1,148 199 47 291 331 350 1,134 221 75 64 39 72 121 154 125 47 56 121 536 89 129 509 75 42 118 33 97 43 152 70 154 96 65 49 52 36 155 26 535 118 182 219 2 45 18 19 563 38 2 131 197 1 109 184 2 37 69 1 30 2 23 67 152 11 1 178 57 30 113 32 23 26 299 74 4,321 2,006 7,408 2,769 91 69 146 40 16 3 14 12 55 25 198 12 32 316 117 50 19 70 70 36 Table 10. — Imports of Chemicals and Related Products, by Commodity Groups and Principal Commodities, Total and From the United States, 1964 — continued [Thousands of dollars] [Thousands of dollars] Tariff number Description Imports United Total States Tariff number Description 1032-014, -016, -017, and -030 1037-002 -003 -005 -006 -021 1038-001 1039-001 1042-003 1043-001 -002 1047-001 1051-001 and -003 1055-001 -011 -012 -021 Group 47 1056-001 -002 -003 -005 1057-001 -002 -006 -007 -008 1059-001 Group 48 1061-001 -005 1064-001 -002 1065-002 -003 1066-001 Group 49 1072-001 -002 -011 1073-001 1074-006 -010 1075-001 -002 1077-001 Antibiotics 528 Insecticides 1,475 Parasiticides 678 Sheepdip 34 Herbicides 496 Chemical pest control products, n.e.s., other than for use against birds or rodents 305 Pomades and ointments, medicinal 38 Albuminous edible preparations .. 26 Biological serums similar to anti- diphtheric or antistreptococcic serums 145 Cow vaccine, for injection 146 Bacteriological cultures for injection 31 Adhesive tape 76 Petrolatum and similar products.. 56 Pharmaceutical products, not specified 179 Pharmaceutical products and chemical mixtures, for use in manufacture of pharmaceutical products 489 Vitamin mixtures for enriching bread 59 Mixtures of dosed chemical prod- ucts for additives to animal foods as stimulants to good as- similation 26 Artificial fertilizers 10,368 Phosphate fertilizers 2,278 Potassic fertilizers 53 Superphosphate fertilizers 4,516 Dicalcic phosphate 1,906 Potassium chloride 47 Thomas' slag 312 Potassium sulfate 601 Nitrogenous artificial fertilizers, n.e.s 246 Potassic artificial fertilizers, n.e.s. 279 Calcined bone or bone ash 130 Explosives, matches and other pyro- technic articles 1,737 Dynamite 142 Explosives similar to dynamite, except gelatin 290 Percussion caps 419 Detonators for explosives 156 Cords, for use in mines 562 Fuses, for use in mines 35 Pyroxyllin and similar material.... 116 Blacking, resins, and industrial fats and oils 16,664 Mineral oil lubricants 1,812 Mineral oil for industrial use 184 Mineral oil for machines, imported in tankers 2,296 Pine oil, called flotation, for con- centrating ores 79 Tung oil 49 Palm oil 81 Unrectified turpentine oil 90 Substitutes for unrectified turpen- tine oil 84 Tar or pitch, mineral 148 247 458 194 3 112 60 18 26 1 112 2 51 47 85 301 Imports United Total States -011 -012 1079-001 -002 1083-001 1085-001 1087-002 -005 -010 -012 -013 -014 -015 1089-001 1091-001 1093-001 1095-001 Group 50 1099-002 22 Group 51 1102-001 6,558 -002 1,379 -005 S -Oil 4,499 -012 8 1110-001 264 1112-003 1113-001 173 -002 121 -003 123 1118-001 904 -003 135 -006 290 56 -007 54 251 1121-001 ■'' 1123-001 116 -011 -012 1124-001 7,113 1125-002 1,515 1126-001 173 1127-001 1,532 1129-002, 71 -004 3 1130-001 62 -011 20 1132-002 47 -004 135 Natural asphalt such as rafaelite.. 523 Mineral tar or pitch imported by the Ministry of Public Works.... 172 Benzine and motor gasoline, for engines, imported in tankers .... 533 Benzine and motor gasoline, for aviation 53 Mineral wax, melting at 60° C. or over 80 Colophony (pine rosin) 403 Gum arabic 39 Gum-lac 35 Natural gums, n.e.s., other than mastic, copal, tragacanth, or gums and resins for making sweets 64 Synthetic resins 6,042 Nitrocellulose pyroxyllin 102 Polyamides and super polyamides, in powder and granules 36 Polyamides, in paste, without coloring 35 Lubricating greases, containing more than 50% of mineral oil .. 616 Cocoa butter, n.e.s 285 Paraffin wax, melting at under 60° C 1,152 Rectified petroleum for illuminat- ing purposes, in tankers 1,473 Industrial alcohols 116 Industrial methyl alcohol 115 Colors, varnishes, inks, and dyestuffs 6,517 Alizarine 35 Aniline 2.682 Organic pigments 55 Coal dyes, dispersed in paste 167 Dyes for the textile industry such as acromine 50 Varnishes, n.e.s., other than ordi- nary or for painting ships 51 Titanium dioxide 916 Animal charcoal 23 Carbon black 1,128 Mixtures of masterbatch and car- bon black 53 Royal yellow (amarillo de rey) , for making paints 33 Oxides of chrome, for making paints 70 Colors and earths, n.e.s., other than coal dyes or ochres 143 Pigments, orange, and chromium molybdate 34 Barium sulfate 71 Paints, in oil or water paste 30 Liquid oil paints, not specified .... 120 Liquid water paints, not specified 27 Copper paint for ship bottoms .... 133 Enamels 44 Artists' paint, for oil or water painting 48 Metallic powders for bronzing, etc 47 Paint dryers, not specified 57 Printing ink, liquid or solid 138 Auxiliary chemical products for printing, not specified 22 Special ink, for machines 44 Ink, for writing, in paste or powder 31 194 157 70 6 47 1,481 72 541 820 61 114 113 1,516 53 1 1 21 28 20 955 47 1 20 3 3 2 35 15 63 22 3 4 3 120 19 3 37 Table 10. — Imports of Chemicals and Related Products, by Commodity Groups and Principal Commodities, Total and From the United States, 1964 — -continued [Thousands of dollars] [Thousands of dollars] Tariff number Description Imports United Total States Group 52 Soaps and candles 119 1138-032 Soaps, in powder, without perfume Group 53 1144-001 -002 -004 1150-001 1151-001 1156-001 -011 -013 1157-011 1158-001 1159-001 -011 -021 1160-001 to 1161-002 1162-011 1166-009 1166-001 to -021 1167-001 1168-001 1169-001 1169-002 to -007 1170-001 -002 Other chemical and industrial products Cresylic acid, for concentrating ores Ethyl acetate, for concentrating ores Mixtures of chemical products, for concentrating ores, other than mixtures with a base of xantate or pentasulfur Chemical charges for extinguish- ing fires Casein and products with a casein base Compositions and cements for glu- ing -. The same, in containers of more than 1 kilogram net capacity .... Prevulcanized latex for automatic bottle closures Auxiliary chemical products for the rubber industry, not specified Soldering compositions Insulation compositions Chemical products for preserving eggs Auxiliary chemical products for metallurgy, not specified Rennet Auxiliary chemical products for tanneries, not specified Essence of bergomot and lime .... Essences or essential oils, fruit ex- tracts, flavors, alcoholates and ethers, n.e.s., for industrial uses 5 Essences and extracts for the manufacture of brandy, whisky, etc Stearin 1,220 593 41 38 Quebracho extract 1,074 Tanning extracts, n.e.s 158 Bakelite and similar products 52 Celluloid and similar products .... 51 1 3 13 20 Tariff number Description Imports United Total States 119 39 Group 53 47 28 1170-011 -021 12,944 6,623 -031 1,788 1,671 -004 253 244 1172-001 612 581 -002 155 55 1175-001 50 1 -004 1176-001 74 49 1178-001 218 159 1180-004 91 3 -005 481 148 1182-001 77 76 36 30 1183-001 55 21 1184-002 43 15 1185-011 116 25 1186-001 1188-011 261 82 155 3 355 56 continued Mouldrite and other plastic products 895 Cellulose, in powdered form 56 Flexible sheets of vinylic and similar resins 595 456 Plastic materials, n.e.s., other than galalith, synthetic resins for increasing resistance, flexible strips of butyral polyvinyl, and gelatin for repairs Glycerine, colored, for manufac- ture of explosives Ethylene glycol for manufacture of explosives Cocoa oil for industrial use Crude palm oil Sodium hyposulfite for photography Yeast and leavenings Chemical pulp for manufacture of paper Woodpulp for manufacture of syn- thetic yarn Pastes and other prepared ma- terials for cleaning, stain-remov- ing, polishing, and lubricating .. Chemicals for photography, not specified Inedible beef tallow and grease, crude Auxiliary chemical products for the textile industry, not specified Thermite solder Color-changing, chemically-coated paper or plastic for indicating chemical, temperature changes, etc All commodity groups, total Listed principal commodities, total Principal commodities as percent of total all commodity groups 97.3 98.0 1 Exclusive of 718-001, 722-001 and 731-001 above. 2 Exclusive of 732-024. above. 3 Equals zero or less than $1,000. 4 Exclusive of 762-014 and 764-007, above. 5 Exclusive of 1166-009, above. Source: Camara de Comercio, Comercio Exterior, Chile, 1964, Santiago, 1965. Note: Principal commodities include all items for which total imports exceed $30,000, or imports from the United States exceed $15,000. 76 10 91 56 152 363 151 146 3 3 31 84 56 304 10 1,397 1,397 150 127 74 30 461 1 612 45 52 1 59 7 78,754 32,936 76,618 32,287 the first two are likely to be produced in Chile in the near future. Fertilizers represent a special case, since Chilean agricultural policy calls for consumption much in excess of planned production. A primary source of raw materials for some of the planned chemical installations will be natural gas pro- duced in Magallanes Province where reserves are estimated to total 105 billion cubic yards. Butane, propane, and natural gasoline are now recovered, but the residual gas — composed of methane (94 percent), ethane (5 percent), and heavy carbons and nitrogen (1 percent) — is now reinjected. This could support an ammonium plant with a capacity of 1,102 tons per day, and a 55,100 tons-per-annum ethylene plant which would provide feedstock for an acetaldehyde plant. A second major source of raw materials is petro- leum by-products from the ENAP refinery at Concon which processes about 10,500 cubic yards of petroleum per day, and the new ENAP refinery near Concepcion which will process about 7,500 cubic yards of petro- leum daily. The following refinery products are a potential source of raw materials for the petrochemical industry: 1. Catalytic reformed gases rich in hydrocarbons (often as high as 50 percent) total perhaps 255,000 cubic yards per day. Though used mostly as a substi- 38 tute for fuel oil, these gases are possible sources of supply for hydrogenation. 2. Reformed products rich in aromatic hydrocar- bons are used to increase the octane ratings of gaso- line. These same products could yield benzene, toluene, and xylene which, in turn, could be used to produce products such as nylon and polyester fiber. Output of reformed products should total about 8,400 barrels daily. 3. Cycle and decanted oils, now burned as fuel oil, could serve as a future source of carbon black. 4. Naphtha and topping gasoline, which are present- ly slated for the production of automobile and avia- tion gas and solvents, could be diverted for petro- chemical projects — perhaps 229,000 to 440,000 tons per year. 5. Cracking gases (35 percent ethane and ethylene) which form a potential capacity of 91,600 cubic yards per day currently serve as refinery fuel. This repre- sents a potential output of 7,700 tons of ethylene per year for each refinery. 6. Ethylene, from a plant to be constructed in the Concepcion refinery complex, should supply the do- mestic market until 1971 with 33,000 tons annually. Subproducts generated from the processing of light naphtha from the topping plant will include liquid propane gas, gasoline, heavy oils, and fuel gas. Such gasoline could be the source of aromatics for ester extraction plants. In addition, the ethylene plant can be modified for the production of other olefines, such as propylene, butylene, and aromatics. The coking process carried out by CAP yields tar (27,550 tons per year ) , benzene ( 5,500 tons per year) , toluene (770 tons per year), and xylene. Tar is now sold for weather proofing, and the remaining products as solvents. These products are available in insufficient quantity and are too costly to justify in themselves the creation of a petrochemical industry, but they could supplement an aromatic extraction plant. Chile's great reserves of sodium chloride ( often reaching 99.2 percent in purity) could, by elec- trolysis, yield caustic soda and chlorine. The latter would be available for the production of vinyl chlo- ride. Until now, the production of caustic soda has grown slowly because of the inability to find a use for the chlorine generated by its production. Developed sulfur resources are currently both expensive and inadequate, but additional supplies could be provided by more intense exploitation of northern sulfur de- posits and pyrite roasting. Chemicals This group — roughly equivalent to what are usually termed industrial chemicals (including raw materials for the manufacture of pharmaceuticals) — is now the largest ($22.9 million in 1964) of nine groups included in the statistical category, Chemicals and Related Prod- ucts. Since 1959, it has represented no less than 24 percent of such imports and as much as 29 percent in 1962. Raw materials for the manufacture of pharma- ceuticals probably constitute between a fifth and a fourth of chemical imports. As in other chemical categories, the United States has lost ground in the Chilean market but remains the leading supplier with 31.9 percent of the import market in 1964. Imports from West Germany (19.4 percent in 1964), the United Kingdom (10.5 percent), and France (10.0 percent) have increased steadily. The only individually specified items which totaled more than $1 million in 1964 were ammonium nitrate, impure potassium chlorate, and caustic soda. This reflects the current limited requirements of Chilean industry and the country's ability to meet most cur- rent needs for acids (particularly sulfuric, nitric, hy- drochloric, acetic, formic, boric, and tartaric), alkalis (including soda ash, sodium carbonates, and, to a lesser extent, caustic soda ) , as well as many other important compounds of calcium (chloride), sodium (including sulfate, sulfides and silicate), potassium (nitrate), and phosphorous. Plans are underway for expansion of sulfuric acid production, mainly in connection with growth of the mining industry. In- creased production of soda awaits development of an economic use for chlorine generated by electrolysis of sodium chloride. In addition, Chile supplies all her requirements for industrial gases except freon. and is virtually self-sufficient in the raw materials for the production of industrial gases. The plastics industry in Chile is thought to have made considerable progress in recent years, but data on the manufacture of both raw materials and finished products is difficult to obtain. However, it is known that there is increasing production of polyethylene, polyvinyl acetate, polystyrene, and a variety of syn- thetic resins. Medicinal Drugs, Pharmaceuticals, and Toilet Preparations This category — medicinal drugs, pharmaceuticals, and toilet preparations — includes veterinarial prepar- ations and pesticides. While imports have been subject to fairly sharp fluctuations in recent years, the trend has been upward, at a rate roughly equaling or exceed- ing that for total chemical imports. The United States share of this market has registered a sharp decline from 68 percent of such imports ($3.03 million) in 1957, to 37.4 percent ($2.8 million) in 1964. West Germany has been the greatest gainer during this period. At present, there are over 45 large modern Chilean plants, some with the most up-to-date equipment, producing various high quality pharmaceuticals and 39 toiletries. Many well-known U.S. and European labora- tories have branches in Chile or have their products manufactured under license by Chilean domestic pro- ducers. There are probably 9 large firms producing antibiotics in Chile, all located in Santiago, and about 20 smaller companies which buy them in bulk and re- pack for local distribution. Special antibiotics, serums, anesthetics, and vaccines are imported directly by the National Board of Health (Servicio Nacional de Salud ) . The use of insecticides, herbicides, and fungicides in Chile is still restricted primarily to the large well- managed farms and fruit growers. Few of the small farmers, who represent the majority of farmers, use these materials. There is growing evidence that mod- ern farming techniques and improved transportation are producing a moderate increase in consumption, which is reflected by an increase of at least $2 million in 1964 from the estimated $1 million in imports of such products in 1960. At least 450 different pesticides are used in Chile. There are probably no more than a half-dozen pro- ducers of pesticides, plus an equal number who repack imported products. Production is more or less limited to products based on sulfur, lime, and copper. Fungi- cides accounted for an estimated 88 percent of total consumption (8,375 tons of active product in 1962). Ninety-five percent of this was derived from domesti- cally produced sulfur. Recently, production has been adversely affected by the short supply of sulfur. The market for herbicides is limited principally be- cause of the small amount of dispersal equipment in use and the small farmer's lack of capital. However, the Government and agricultural societies are provid- ing increased technical aid to farmers. While U.S. -manufactured pesticides are considered in Chile to be of high quality and great efficiency, they have not always fared well in price-competition with European suppliers. Artificial Fertilizers Although Chile produces sufficient sodium and po- tassium nitrates to meet domestic demand and to ex- port as well, it must import other fertilizers, such as phosphates, ammoniated fertilizers, and meat- and bone-meal to meet other requirements of its soils. Fer- tilizer imports have grown more rapidly than any other group in the chemical products category. They totaled only $2 million in 1957, 3.9 percent of all imported chemicals, but averaged $12 million annually in the years 1963-64, 13.6 percent of such imports. Greatly increased consumption of phosphatic fertilizers, par- ticularly superphosphates, is responsible for this in- crease. The United States has supplied most of the 40 increase, with the result that it accounted for 63.4 per- cent of all fertilizer imports in 1964, compared with 12.6 percent in 1957. The Chilean Government has become increasingly concerned about both the slow growth of its agricul- tural sector and the resulting importation of an esti- mated $70 million annually of foodstuffs and feeds in which it was once self-sufficient. One of its objectives is to boost production by bringing about a substantial increase in the use of fertilizer. Only 13 percent of Chile's 48 million acres of land capable of supporting agriculture was fertilized in 1964. Furthermore, Chil- ean agronomists estimate that the consumption of phosphates in 1963 (84,922 tons phosphate content), amounted to slightly less than half the optimum level of consumption. To give immediate support to this program, AID concluded a $3.6 million loan with the Chilean Govern- ment to finance the importation of 48,500 tons of triple-superphosphates for use in the 1966 crop season. CORFO is considering the construction of a $10 mil- lion triple-superphosphate plant which could be producing 66,000 tons annually by 1968 and 132,000 tons sometime thereafter, in addition to a maximum of 11,000 tons annually from other domestic sources. Nevertheless, it is estimated that Chile will still have to import at least 84,900 tons of phosphates annually until the new plant reaches full capacity if it is to maintain or increase per capita agricultural output. Explosives, Matches, and Other Pyrotechnics Chile's explosives industry supplies nearly all of the country's industrial needs — which are substantial be- cause of the mining industry's requirements — and ex- ports moderate amounts. All of the country's require- ments for matches are met by the domestic industry. Imports in this category have grown modestly in re- cent years, but totaled only $1.7 million in 1964, with detonating materials about four-fifths of the total. The United States has been the leading supplier of this market since 1961, usually followed by the United Kingdom. Most of the raw materials for the explosives industry, particularly sulfur and nitrates, are obtained locally. Blacking Resins* Industrial Fats, and Oils Until 1961, this group, comprised mainly of refined petroleum products, represented the leading importa- tion into Chile of chemicals and related products. By 1960, ENAP had more than doubled the refining ca- pacity of its Concon installation of Valparaiso, which had gone into production in 1954. A ENAP refinery on San Vicente Bay near Concepcion is expected to nearly double Chile's refining capacity. This additional production should be sufficient to meet Chile's projected demand for gasoline, kerosene, and diesel fuel up to 1970, although it will still be necessary to import fuel oil. In 1964, ENAP claimed to have supplied all of the country's requirements for automotive and aviation gasoline and liquid propane gas, 85 percent of its diesel fuel and kerosene, and 60 percent of its fuel oil. Chile does not now produce a number of products, such as asphalt, waxes, and lubri- cants. However, lubricating oils and greases are blend- ed locally from imported materials. Three distributors operating as concessionaires — COPEC; Esso Standard Oil Co. (Chile), S.A.C.: and Shell, Chile, Ltda. — share the market for petroleum products. There is free competition for indent busi- ness, and there are many importers of lubricating oils and greases. The United States has for many years been the leading supplier of these products to the Chilean mar- ket but has experienced a decline in its share of the market to 42.6 percent in 1964 from more than 90 percent in the early and mid-1950's. In recent years, West Germany and the Netherlands Antilles have provided the United States with increasing competi- tion, supplying 22.4 percent and 13.5 percent of the market, respectively, in 1964. Industrial Alcohols Chile is self-sufficient in the production of ethyl and butyl alcohol but must supplement its production of methyl with small imported quantities. Even smaller amounts of amylic alcohol are regularly imported, as are other industrial alcohols from time to time. The United States supplied $114,000 out of $116,000 in imports of industrial alcohols in 1964. Colors, Varnishes, Inks, and Dyestnffs This has been the sixth largest group among chemical imports since 1958. Three items — aniline, carbon black, and titanium dioxide — accounted for 71 percent of this group in 1964. West Germany overtook the United States as the leading supplier of such products in 1959 and has since supplied between 30 and 36.6 percent ( 1964) of the market in each year. The U.S. share of this market has declined gradually during this same period, and now is 23.3 percent. One product, carbon black, accounted for 65.6 percent of U.S. sales in this category. Four dyestuff manufacturers produce some 60 dif- ferent colors. All intermediate products are imported, principally from Europe. Only the more commonly used dyestuffs are produced, the more specialized fast and vat dyes being imported. Chile produces its own requirements for ultramarine, iron oxide, red lead, ochre, sienna, and umber. Some extender pigments are also produced. Chile has a substantial paint industry comprised of some 40 plants. Twelve companies — most having licensing arrangements with U.S. and European firms — produce up to 90 percent of total production. The industry meets domestic demand for high quality pastes, enamels, varnishes, and prepared waterbase paints. Except for special paints, only small quantities of these materials are imported through the free ports, particularly Punta Arenas. While a considerable quantity of raw materials for the paint industry is produced in Chile, somewhere near 50 percent of the industries requirements are im- ported. Some of these, such as synthetic resins and solvents, are included in the statistical group, Chemi- cals. Paint manufacturers import most of their re- quirements directly, although there are several im- porters of chemical products who also supply the domestic paint industry. Chilean production is sufficient to meet almost all of the country's requirements for inks, particularly print- ing inks, but some special inks are imported, mainly from the United States. Soaps and Candles Chile has a well-established soap industry capable of producing the country's requirements for laundry soap, washing powders, soft soaps, soapflakes, deter- gents, toilet soaps, and scouring powders, and other cleansing agents. Both candles and soap are pro- hibited entry into all but Chile's free ports. In 1964, very limited quantities of soap, mostly soap powders, were imported, mainly into Punta Arenas. Other Chemical and Industrial Products This catchall category includes a variety of products, most of which are imported as raw materials for in- dustry. While this croup has declined as a percentage of overall chemical imports in recent years, it con- tinues to be the third largest group, representing 16.4 percent of chemical and industrial products in 1964. The major reason for this decline is the substitution of domestically produced pulp for imported chemical pulp for the manufacture of paper. Such imports totaled $4.2 million in 1958 (41 percent of Other Chemicals), but only $0.3 million in 1964. However, the growth of other imports in this group — particu- larly cresylic acid, woodpulp for the manufacture of yarn, and essences and essential oils — have offset those losses to a large degree. Those four items, together with quebracho extract, accounted for 42.4 percent of Other Chemicals and 55.5 percent of U.S. sales in that group in 1964. 41 The U.S. share of this market has improved in recent years, and it represented 51.2 percent in 1964. Argentina follows with 13.2 percent (based primarily on sales of quebracho extract and inedible beef tallow and grease), and West Germany with 11.4 percent ( mainly chemicals for use in the textile, plastics, and tanning industries). The expected rapid expansion of Chile's mining industry — both large and small operating units — should greatly increase demand for chemical materials used in the concentrating of ores and for the manu- facture of explosives. The expected continuing moder- ate expansion of the textile, rubber, plastics, and food- processing industries should generate a steadily grow- ing demand for auxiliary chemicals, materials, and essences in those industries. Woodpulp importation should further decline once the Chilean pulp industry makes the necessary adjustments for the production of pulp suitable for the manufacture of synthetic yarn. Although Chile is almost entirely dependent upon im- ports for photographic chemicals, their importation will probably continue to be limited by severe import controls. METALLURGICAL PRODUCTS The level of Chilean imports of metallurgical prod- ucts has remained relatively stable in recent years, with annual totals close to the $33-million average for the 1958-64 period. These imports have averaged a little more than 6 percent of total imports during 1960-64. However, the expected continued substantial growth in domestic steel production makes it unlikely that this category will share in the overall growth in imports. Indeed, had it not been for unusually large imports of seamless and welded pipe for an urban water program in 1964, which boosted the total to $43.2 million, the 6-percent average noted above would have felt another downward pull as it did in 1963 when metallurgical products accounted for only 4.9 percent of total imports. Import data for 1965 may not reflect this trend because of production lost from a 67-day strike that year, but the completion of the latest phase of the steel industry's expansion program will shortly be felt. Nonetheless, the growth in demand for nonferrous metal manufactures, the continued demand for steel products not yet manufactured in Chile, the require- ments of special projects, and the difficulties inherent in matching domestic steel production schedules with rapidly rising demand should guarantee that overall sales in this category will at least remain close to current absolute levels in coming years. The United States continues to be the leading sup- plier of metallurgical products to the Chilean market, but its share has declined considerably from the late 1950's when it regularly exceeded 60 percent. West Germany has been steadily increasing its share, reach- ing 24.1 percent in 1964, compared to 37.0 percent ($16.0 million) for the United States. This growth has been concentrated in rolled steel for which in 1964 West Germany replaced the United States as the lead- ing supplier. France moved into third place in 1964 with 6.5 percent of the market, as the United King- dom — the traditional third supplier — slipped to fourth with 5.4 percent. Belgium, Japan, and Sweden have also been substantial suppliers of metallurgical prod- ucts in recent years. Table 11 shows Chilean imports of metallurgical products, by commodity groups and principal commodities, total and from the United States in 1964. CAP turns out more than 90 percent of all Chilean iron and steel products. The CAP's expansion — financed in part by sub- stantial foreign credits, including those from the Exim- bank — has moved according to schedule, with the exception of the planned electrolytic tinning facility. CAP has been supported in this effort with technical assistance provided by the Koppers Company of Pitts- burgh. CAP's production facilities now include two 25,000-cubic foot blast furnaces (the second began operation in early 1966), two 220-ton and two 110-ton oxygen-injection open hearth furnaces, and extensive rolling mill and other steel finishing facilities (includ- ing an improved 32-inch rolling mill). In early 1966, a new slab furnace, additional soaking pits, and a new ingot stripper were nearing completion. These im- provements are designed to increase CAP's ingot ca- pacity from 529,000 to 716,000 tons annually. By the end of 1964, ingot-to-finished-product yields was 71 percent. New expansion plans, which were revealed near the end of 1965, call for an increase in ingot production to 1.1 million tons annually by 1971. Under this plan, CAP contemplates the installation of electrolytic tinning facilities, the enlargement of lami- nated-steel capacity, and the creation of a continuous- flow rolling process which will eliminate the ingot stage in the production of semi-finished steel products. Chilean iron and steel apparent consumption is estimated as follows in thousands of tons: 398 in 1962, 415 in 1963, and 463 in 1964. The consumption con- sisted of both shipments of domestic mills and im- ports, as follows, in percent: Chilean shipments: 1962 1963 1964 By CAP 79.5% 82.5% 79.4% By small companies 7.7% 7.7% 6.3% Imports 12.8% 9.8% 14.3% See Table 18, Appendix D for a detailed product breakdown of CAP shipments of iron and steel prod- ucts to the domestic market in 1962-64. In 1964, about one-third of all iron and steel con- sumption was accounted for by the construction in- dustry; one-fifth by the mining industry; one-tenth 42 Table 11. — Imports of Metallurgical Products, by Commodity Groups and Principal Commodities, Total and From the United States, 1964 [Thousands of dollars] [Thousands of dollars] Tariff number Group 54 1189-001 -002 -003 -005 -008 -009 -010 -011 -012 1190-002 1191-002 1193-001 -002 -003 -011 1194-001 -011 -012 -014 -021 -022 -031 -041 1200-001 -002 1201-001 -002 1206-001 -002 1209-002 1210-002 -005 1213-001 1214-010 1217-001 1221-001 1222-001 1224-001 1226-001 1227-004 -011 -016 Description Imports United Total States Iron and steel, rolled 9,900 2,736 Bars, round 345 85 Bars, square 42 4 Angular sections 65 13 Hoops and bands 62 6 Window frames 47 1 Structural shapes 45 39 Polygonal sections 303 118 Alloys of ferro-nickel and ferro- chromium, bars 335 19 Nickel or chromium alloy steel for manufacturing tools 53 3 Hoops, galvanized 31 5 Expanded sheets (diamantada) .. 138 13 Plain sheets, thin (less than 2 millimeters thick) 633 381 Plain sheets, medium (2 to 4.5 millimeters thick) 115 25 Plain sheets, thick (more than 4.5 millimeters thick) 36 3 Plain sheets, of ferro-nickel or ferro-chromium alloys 365 70 Sheets, painted or galvanized 136 97 Bars, cut in any form 204 156 Sheets, cut in any form 80 24 Pieces of steel for axles 34 32 Bars, with perforating or polish- ing work 59 32 Sheets, with perforating or polish- ing work 58 23 Shapes, in compound sections 5,507 861 Armored liners for crushing and pulverizing machines 771 472 Corrugated sheets, galvanized 258 162 Other metals, rolled or cast, includ- ing their alloys 659 343 Aluminum bars 84 48 Aluminum sheets 118 50 Aluminum bars, worked 32 26 Aluminum sheets, worked 99 24 Nickel bars 28 25 Nickel sheets or plates 55 55 Zinc sheets, n.e.s 120 45 Zinc sheets, worked 27 27 Metal wares for various purposes .... 1,261 677 Iron wire, plain, not galvanized, for construction 31 4 Iron wire, plain, not galvanized, n.e.s., for making nails or springs 110 18 Iron wire, plain, galvanized 185 43 Wire, n.e.s., other than iron, cop- per, chrome-nickel, molybdenum, nickel, copper-nickel, or lead .... 83 42 White metal 31 8 Scrap iron 234 234 Filings, grains, and shavings of aluminum 75 70 Filings, grains, and shavings of iron 30 4 Solder, in iron bars and rods 63 53 Solder of ordinary metals, n.e.s., other than of iron, bronze, tin, or lead 28 24 Solder, with iron resin 107 53 Solder, with resins of metals, n.e.s., other than iron, bronze, tin, lead, or silver alloy 83 49 Wares of iron or steel (including those plated with other metals) 28,246 10,668 Tariff number Description Imports United Total States Group 57- 1229-007 -008 1230-007 -009 1232-004 1236-001 1241-002 -004 1242-003 -013 -023 1243-001 1246-001 1248-002 1250-001 1252-001 1253-001 1255-001 ■011 -002 ■012 -003 -004 005 -015 -021 -022 -023 1256-001 -002 1267-002 1269-001 -008 -011 -012 1271-001 -003 -continued Kitchen knives and cleavers of steel 37 1 Ladles, strainers, spits and similar kitchen utensils of steel, n.e.s... 76 20 Cash or sales registers, including vending machines 134 115 Whetting steels for all purposes.. 152 2 Wares of soft (wrought) iron, other than sanitary, table, or kitchen 45 9 Wares, with parts of bakelite or similar materials 54 42 Tinplate containers 54 34 Tinplate ware, n.e.s., other than sanitary, table or kitchen 49 25 Wares of iron, n.e.s., other than sanitary, table or kitchen: Weighing up to 1 kilogram 434 218 Weighing 1 to 10 kilograms .... 330 200 Weighing more than 10 kilo- grams 280 214 Fasteners or hooks for cases or bottles 130 92 Baths and vats of soft or cast iron 30 Tanks, in any form 806 619 Wire cable or rope 1,391 342 Chains, without rings, hooks, etc. at their extremities; also chain links and parts, when the metal has a circumference of: 10 to 40 millimeters 234 61 More than 40 millimeters 337 150 Pipe and tubing, of steel or wrought iron, with a diameter: Less than 75 millimeters: Welded 2,756 586 Welded, galvanized 109 39 Seamless 3,407 923 Seamless, galvanized 125 20 75 millimeters or more: Welded 276 31 Seamless 2,725 118 Accessories and fittings 3,347 1,112 Accessories and fittings, galvanized 77 27 Tubing, of sheet iron or steel, less than 1 millimeter thick, with a diameter: Less than 50 millimeters 57 54 50 millimeters or more 205 7 Accessories 40 4 Pipe and tubing, of cast iron, with a diameter: Less than 75 millimeters 68 20 75 millimeters or more 30 a Wire mesh or cloth 140 87 Household heaters and cookers, burning coal or wood 108 21 Household heating and cooking devices, burning coal or wood, n.e.s., other than braziers, fur- naces, stoves, broilers or kitchen ranges 30 23 Household heaters and cookers, burning gas 70 51 Household furnaces, burning gas.. 81 66 Heaters and cookers, for institu- tions such as hospitals and colleges 64 * Furnaces, for institutions such as hospitals and colleges 20 20 43 Table 11. — Imports of Metallurgical Products, by Commodity Groups and Principal Commodities, Total and From tbe United States, 1964 continued [Thousands of dollars] [Thousands of dollars] Tariff number Description Imports United Total States Group 57- 1274-002 1275-001 1278-003 -004 1279-001 -013 -014 -015 1281-001 -011 1290-001 -002 -004 -005 1293-001 -003 1294-001 Group 58 1298-002 -011 1299-005 -006 1300-005 -continued Horseshoe nails 121 1 Razor blades 593 243 Valves, for any use 2,494 1,703 Spare parts for cocks, faucets, and valves 36 29 Water meters, drinking-water 47 32 Gas meters 97 24 Meters for gases or liquids, n.e.s., other than oil 82 50 Spare parts for meters, other than drinking-water meters Furniture, of all kinds Dentist chairs Bearings (rodamientos) Boxes or frames for bushings Bushings (cojinetes) Pillow blocks Screws, bolts, washers, and nuts.. Steel devices on which the above are fixed Tubes or cylinders for compressed gas Wares of other metals Aluminum wares, n.e.s., other than cooking ware, cans and coffins .. Milk cans, aluminum Wares of copper and copper alloys, n.e.s., other than locks, zippers, extinguishers, electric lamps, or lamp burners 147 30 Bronze caps, for the manufacture of electric lamps 92 3 Nickel- or chrome-plated wares, n.e.s., other than spring locks, extinguishers or electric lamps.. 37 16 41 41 199 137 44 7 2,953 1,565 40 11 59 38 659 474 1,274 559 218 58 204 95 3.174 1,545 207 113 102 i Tariff number Description Imports United Total States -continued Tin wares, not nickel-plated, n.e.s., other than handles 31 11 Wares of nickel or nickel alloy, with bakelite parts 40 21 Hinges 37 1 Pipe and tubing of aluminum, straight 57 38 Pipe and tubing of copper alloys, straight 83 71 Fittings for pipe and tubing 24 21 Copper tubing 31 14 Aluminum foil 151 1 Lamps and lanterns with fuel res- ervoirs 39 1 Bronze bearings and bushings for motors 363 315 Bronze water nozzles 35 30 Bronze cocks, for any use 39 10 Bronze spare parts for cocks, faucets, valves, and nozzles 31 12 Bronze valves, for any use 1,197 623 Sealing leads and fasteners for cases and bottles 49 43 Bolts, screws, screw-eyes, and nuts 70 49 All commodity groups, total .... 43,240 15,969 Listed principal commodities, total 41,676 15,386 Principal commodities as per- cent of total all commodity groups 96.4 96.3 1 Eiiuals zero or less than $1,000. Source: Camara de Comercio, Comercio Exterior, Chile, 196i, Santiago, 1965. Note: Principal commodities include all items for which total imports exceed $30,000, or imports from the United States exceed $15,000. Group 58- 1302-003 1306-021 1307-001 1314-001 1315-001 -003 -012 1328-001 1329-001 1330-002 -004 -005 -006 -008 1334-001 1337-001 or more by each of the agriculture, transportation, and manufacturing sectors: and the remainder by the power, fishing, urbanization, and miscellaneous sec- tors. Nineteen sixty-five was expected to show sub- stantially increased consumption by the power and agricultural sectors and somewhat reduced consump- tion by the mining and transportation sectors with to- tal consumption reaching about 562,000 tons. Increased demand will depend on many factors, one of which will be the success or failure of Chile's copper expansion program which is expected not only to consume steel products but also to influence the expansion plans of many other steel-consuming in- vestors. Maintenance, at least, of the historical trend of an average 6.6-percent annual increase in the con- sumption of iron and steel products seems assured. The CAP is presently committed to a policy of giving priority to the supply of domestic not foreign needs. A decree was promulgated in 1964 (No. 1250 of November 18) requiring Chilean govern- mental and semi-governmental entities to purchase Chilean metallurgical products or parts in prefer- ence to imported products when "of equal price and quality. " CAP's domestic pricing policy for the next 5 years is based on the formula of f.a.s. -Pittsburgh price plus 15 percent. The f.o.b.-Huachipato price for many steel products — such as reinforcing bars, flat bars, angles, wire rod, skelp, heavy plate, hot and cold rolled sheets, corrugated galvanized sheets, hot dipped tinplate, and semi-finished products — is either equal to, or less than, that for U.S. steel c.i.f. Valpa raiso (Pittsburgh price plus conference freight tariff). Despite the favorable position enjoyed by domestic production, the importation of many of these products continues either because it is difficult for the domestic industry to meet special specifications, or because im- ported items subsequently are incorporated into export products which the Government wishes to facilitate. Iron and Steel, Rolled Products This statistical group reflects most closely the sub- stitution of domestic production for imported prod- ucts. It accounted for 22.9 percent ($9.9 million) of imported metallurgical products in 1964, compared 44 HUACHIPATO STEEL: Wi,re rod loader at Cia. de Acero del Pacifico steel plant at Huachipato, Chile. with 40 percent in the early years of the 1955-64 decade. The absolute level of such imports has declined from the $11.5 million annual average, covering the years 1957-61. Shapes in compound sections accounted for 55.6 percent of such imports in 1964, with the re- mainder of imports scattered among several categories. Apart from these, only armored liners for crushing machines, thin plain sheets, and bars and plain sheets of ferro-nickel or ferro-chromium alloys exceeded $0.5 million in value. The sales pattern of the United States, which has supplied as much as 80 percent of the market in the past decade, strongly reflects the effects of substi- tution. By 1964 the United States accounted for only 27.6 percent of the import market ($2.7 million), while West Germany moved into first place with 37.6 percent, largely on the basis of its sales of shapes in compound sections ($2.6 million). U.S. sales are con- centrated in shapes in compound sections, armored liners for crushing machines, thin plain sheets, gal- vanized corrugated sheets, cut bars, and polygonal sections. Japan emerged as third supplier (also mainly through sales of shapes in compound sections) with 10.6 percent, followed closely by France with 9.4 percent. Table 17, Appendix D shows CAP shipments of round, square and flat bars; grinding bars and bars for manufacture of grinding balls; wire rod; angles and light shapes; railroad shapes; plates and coil plates; hot and cold rolled sheets; galvanized sheets: coils; black plate; and tinplate. CAP discontinued the production of structural in 1961. Table 1<"> of the same appendix provides a detailed quantitative break- down of Chilean imports of rolled products. 45 Other Metals, Rolled or Cast, and Their Alloys Rolled or cast nonferrous metal imports have yet to reach a total of $1 million. The United States ordin- arily supplies one-half or more of these imports, which in 1964 included aluminum and nickel bars and sheets, and zinc sheets. Small quantities of specialized copper bars and sheets are imported from time to time. The paucity of such imports reflects the fact that Chile supplies most of its own requirements for rolled or cast nonferrous metal products, including copper and copper-alloy bars, sheets and strip; brass, bronze and aluminum sheets, bars and strip; alpakka sheets; and lead sheets. Domestic copper fabricators have for many years been guaranteed by law an assured supply of raw materials at a discount of up to 10 percent of the producer's price. This discount was limited to 0.1 percent for the first 22,000 tons to be consumed in 1966. Metal Wares for Various Purposes This group consists of metallic wire and cord; powdered tin and alloys; white, babbit, and type metals; scrap metals; metallic filings, grains, and shavings; solder in bars and sheets; and zinc powder. The value of imports in this group has stabilized at between $1.2-$1.7 million annually after demon- strating moderate growth in the late 1960's. The United States has ordinarily supplied at least one-half of the market, usually followed fairly closely by West Ger- many. Various types of iron wire and solders and scrap iron make up the bulk of such imports. Iron and steel, copper, brass, bronze and other non- ferrous wires and cords are produced by local firms, but not always in sufficient quantity to satisfy demand. Chile also produces type and babbit metals, alloys, silver wire, galvanizing powders, tin and silver solders, and antimonial lead for batteries. Wares of Iron and Steel This group comprises a wide variety of metal wares, including those plated with other metals. They range from pipe and wire cable through bearings, fasteners, heating devices, household wares, and valves to gas and water meters and dentist chairs. The value of imports in this category has remained relatively stable in recent years, at approximately $18 million. Since annual totals for the next largest group, rolled iron and steel products, have generally been declining, this group has shown a modest increase as a percentage of all metallurgical imports — 58.7 per- cent and 56.7 percent, respectively, in 1963 and 1964. Unusually large imports of seamless and welded pipe in support of Chile's urban water system program boosted that share to 65.6 percent ($28.2 million) in 1964. Pipe, tubing and their accessories, and fittings ac- counted for 46.9 percent ($13.2 million) of imports in this group in 1964. Items, each of which accounted for between 5 and 10 percent of imports in this group, included bearings and related devices; valves; screws, bolts, washers and nuts; and wire cable or rope. Other substantial imports included unspecified iron wares, tanks, chains, and razor blades. The United States continues to be the leading sup- plier of iron and steel wares, with 37.8 percent ($10.7 million) of total imports in 1964, as its sales have fluctuated between about $7 and $10 million annually between 1956 and 1964. United States sales were heaviest in pipes and their fittings and accessories; bearings and similar devices; valves; screws, bolts, washers, and nuts; tanks and unspecified iron and steel wares. The development of Chile's steel producing facilities has greatly spurred the growth of the iron and steel fabricating industry. At the present time, this industry supplies most of Chile's requirements for finished and semifinished products. The quality of products manufactured by Chilean metal plants and shops has improved considerably under the auspices of the Metallurgical Industries Association (Asocia- cion de Industrias Metalurgicas — ASIMET) which claims 96 percent of the metals industry as members. The local industry produces a wide variety of iron and steel products, such as steel structures, storage tanks, metal doors and windows, plated wares, pres- sure cookers, drums, cans and tins for the food-proc- essing industry, crown and bottle caps, tubes, cutlery, household hardware, cooking utensils, heating and cooking equipment (including oil burners), plumbing supplies (including valves), fittings, locks, nails, staples (for paper), tacks, spikes, pins, nuts and bolts, rivets, screws, springs, safes, and vaults. A $900,000 investment by the Atlantic Community Development Group for Latin America (ADELA) in a Chilean firm for producing seamed pipe was announced in early 1966. Consumer items, particularly if domestically pro- duced, are largely excluded from most of the Chilean market by import restrictions. However, there is a limited demand for some imported consumer items, such as hardware, when they are of obviously superior quality. In addition, a fairly substantial quantity of consumer items are imported through the free ports for use there. ( See Chapter VI for free-port regula- tions. ) Wares of Other Metals Imports of nonferrous metal wares have averaged a modest $3.7 million annually during 1961-64, after experiencing substantial growth in the late 1950's and 46 early 1960's. Manufacturers of bronze, particularly valves, accounted for about one-half of such imports in 1964. The United States — mainly by virtue of sales in the same category — continues to be the market's leading supplier, with 48.5 percent ($1.5 million) in the same year. The United States has seen an improve- ment in its share in recent years, while the share of the second supplier, West Germany, has declined from 38.2 percent in 1961 to 18.6 percent in 1964. Chile is a producer of lead pipe, copper pipes and tubes, aluminum foil, aluminum pipes and tubes, and many nonferrous hardware items. MACHINERY, ACCESSORIES, AND TOOLS Machinery, accessories, and tools lead all other Chilean imports and have done so during the past decade. They make up a category of imports that has grown more steadily than any other category. Their value amounted to 26.0 percent of total value of im- ports in 1964, compared with 15.7 percent in 1955. Imports of such products averaged $141 million annu- ally during 1961-64, while the 1964 total of $158 million was almost $100 million higher than that for 1955. General industrial machinery represents the largest and fastest growing group in this category. Imports of electrical and motive machinery have been substantial, but their growth has not been as steady as that of general industrial machinery. Imports of mining and agricultural machinery continue to repre- sent a small portion of machinery imports, and the growth, particularly of the latter, has lagged. Because of the age of much machinery in use in Chile, a large portion of imports consists of replacements and spare parts. Table 12 shows Chilean imports of machinery, accessories and tools, by commodity groups and principal commodities, total and from the United States in 1964. Table 12. — Imports of Machinery, Accessories, and Tools, by Commodity Groups and Principal Commodities, Total and From the United States, 1964 [Thousands of dollars] [Thousands of dollars] Tariff number Group 59 1342-001 1343-001 -003 -004 1344-003 1345-001 Group 60 1346-001 1347-001 -002 -003 -004 -006 -007 1348-001 1351-001 Group 61 1352-001 1354-001 -002 -003 1355-001 -011 Description Imports United Total States Mining machinery, implements, ac- cessories and tools 6,439 3,965 Special safety lamps 25 19 Excavators 313 298 Drilling machinery 521 177 Mining machinery, n.e.s 2,619 1,157 Apparatus, n.e.s., other than iron buckets for carrying metals 456 317 Components and spare parts 2,497 1,991 Agricultural machinery, implements, accessories and tools 4,999 2,886 Ploughs 402 90 Fertilizer spreaders 57 39 Harrows 411 227 Mowers 105 67 Sowers 207 176 Agricultural machinery, n.e.s., other than threshers, corn pick- ers, milkers, levelers and grad- ers, and lister-type fertilizer- planters 1,271 777 Harvesters, n.e.s., other than corn pickers 1,269 535 Apparatus, n.e.s 75 36 Components and spare parts 1.122 926 Machinery, accessories and tools, n.e.s., for industries and trades.. 99,801 45,335 Oilers and lubricators for machines 98 75 Pumps, for industry or trade 2,742 1,386 Fire-fighting pumps 48 6 Pumps for dispensing fuels 55 7 Apparatus for conveying materials or products, n.e.s 70 7 Machines for conveying materials or products, n.e.s 3.235 684 Made-up packings, disks, or rings for clutches, pistons or valves; brake-bands and interior parts, n.e.s., for cocks, faucets, and valves: Tariff number t Description Imports United Total States Group 61— 1356-001 -continued Of cork 44 334 931 848 4,840 612 130 100 211 432 30 -011 -021 -031 Containing 30% or more of rubber Of metal, including those with rubber or other materials N.e.s., other than those of leath- er or asbestos, rubber rings for protecting boring tubes, and weather stripping 248 717 491 1357-001 Cranes, derricks, winches, and other lifting machines 2,747 -002 Passenger elevators 8 -011 -012 -013 1358-001 Pulleys, block, and tackle Jacks Lifting apparatus, n.e.s., other than pneumatic carriers Sewine machines 69 25 139 132 -002 -003 -004 -006 -011 -013 -014 -015 -018 -019 -021 -023 -024 -027 -030 -032 -033 -040 -041 Refrigerating machinery, other than domestic 1,318 Machinery for the following in- dustries, n.e.s.: Printing or lithography 812 Glass-making 214 Footwear 65 Food-preserving 365 Copper-fabricating 59 Dairy 688 China and porcelain 53 Nitrate 56 Steel 33 Textile 3.111 Washing machines 237 Lathes 1,247 Hydraulic presses for plastics 162 Milling machines 149 Shaping and slotting machines .... 34 Sewing machines, for household or popular use 2,293 Planning machines 110 Machines for packing, wrapping, and applying cellophane 81 327 367 101 4 158 20 37 6 47 33 620 83 244 1 35 22 2 14 47 Table 12. — Imports of Machinery, Accessories, and Tools, by Commodity Groups and Principal Commodities, Total and From the United States, 1964 continued [Thousands of dollars] [Thousands of dollars] Tariff number Description Imports United Total States Tariff number Description Imports United Total States Group 61- -044 -045 -046 -047 -048 -049 -050 -052 -054 -057 -059 -064 -067 -025 1359-003 -009 -019 -013 1360-001 -004 -005 -006 -007 1361-001 -002 -005 1362-001 -002 1367-001 -002 -003 -004 -006 -007 -008 to -019 1371-002 -003 1376-001 -004 -006 -007 -009 -011 -012 Group 62 1383-001 -002 -continued Automatic looms 128 1 Electric drilling machines 79 15 Turret or capstan lathes 190 83 Machinery for plastics industry, n.e.s 164 4 Non-calculating statistical ma- chines using punched cards 753 266 Eccentric presses, more than 100 metric tons 113 17 Centrifuge machines of all types .. 188 22 Road rollers, without means of propulsion 64 x Air compressors 2,824 2,233 Fans 64 21 Paper cutting and trimming ma- chines, automatic and semiauto- matic 39 1 Machinery for filling, closing, seal- ing, capsuling, or labeling 126 1 Excavators 45 H Machinery, not specified 2 30,503 10,164 Crucibles 35 2 Apparatus for the textile industry 97 5 Manometric air filtering and regu- lating equipment 20 19 Apparatus, not specified " 9,173 4,643 Protective safety helmets 84 76 Protective safety gloves 45 40 Protective safety masks 89 78 Protective clothing and apparatus, n.e.s., other than aprons and rubber wrappings for electrical workers 87 69 Spare parts for protective clothing and apparatus 84 77 Components and spare parts for machinery 19,112 13,512 Parts for road construction ma- chinery 78 68 Continuous woven felt belts for industrial machinery and ap- paratus 30 x Whetstones 32 18 Stones, of emery or carborundum 325 89 Replacement appliances, of wood.. 97 45 Replacement appliances, of metal 4,665 2.878 Blades for handsaws 71 7 Saws of all kinds, for machines.... 336 69 Matrices and molds for the plas- tics industry 59 5 Drills and bits for wood and metal 382 290 Replacement applicances, n.e.s., other than molds for phono- graph records 1.106 697 Drilling machines 54 13 Wimbles 95 51 Pliers 47 8 Wrenches 262 122 Flatirons for clothing 30 7 Handsaws and saws 35 5 Tool sets and parts 1,159 474 Files and rasps 94 9 Guns and similar apparatus for painting or spraying 32 6 Motive machinery, boilers and spares 20,309 10,477 Steam or pressure water-heating boilers: Weighing up to 3,000 kilograms 374 177 Weighing more than 3,000 kilo- grams 1,278 533 -003 Radiators and water heaters 33 32 1387-001 Nonleather transmission belts and bands 516 207 1388-001 Conveyor belts and bands, leather 134 2 -002 Conveyor belts and bands, rubber 780 241 -011 Conveyor belts and bands, with teeth 100 28 Motors and engines, including those for vehicles: 1390-001 Diesel 283 75 -003 Internal combustion 2,138 1,400 -005 For fishing boats 1,930 1,370 1393-001 Electric, up to 5 horsepower .... 323 151 -002 Electric, over 5 horsepower 1,189 431 1395-001 Turbines, not for dental use 2,891 83 1396-001 Components and spares for boil- ers, motors and turbines 8,260 5,712 Group 63 Electric machinery, apparatus and material 26,154 11,680 1397-001 Insulators, for electric current .... 397 246 1398-001 Copper wire, covered with insulat- ing material other than silk 72 51 1399-001 Copper cables 1,825 786 -003 Cables, not of copper 521 56 1400-001 Screw-type light bulbs 61 27 -002 Bulbs for lighting, n.e.s., other than fluorescent or mercury vapor 605 200 1401-001 Audio and rectifying valves, for any purpose 1,016 649 1402-001 Telephone plant apparatus, wire- less or not 4,991 1,228 1404-002 Electric bells 25 21 1405-001 Flexible tubes for non-built-in electric installations 77 44 -011 Rigid tubes for built-in electric installations 117 69 1406-001 Carbons and electrodes 475 230 -002 Graphite electrodes 146 35 1407-001 Prepared tapes of insulating ma- terial 98 57 1408-001 Dynamos and generators 886 592 -002 Alternators 71 2 -003 Converters 114 90 -005 Generators, up to 300 kilovolts .... 134 64 -006 Generators, 300 to 1,000 kilovolts.. 102 63 -007 Generators, 1,000 to 10,000 kilo- volts 52 40 -011 Diesel generator sets, up to 300 kilovolts 32 3 -014 Generating machinery, n.e.s., other than generator sets 386 108 1409-001 Noncovered connections, for elec- tric current 188 144 -011 Covered connections and male plugs 602 314 1410-001 Condensers 431 132 -002 Rectifiers 126 80 -003 Rheostats 179 119 -004 Resistors and coils 581 251 -005 Transformers, up to 200 kilowatts 1,338 777 -006 Transformers, more than 200 kilo- watts 694 236 -008 Filaments and wire, including tungsten spirals 34 1 -011 Complete distribution and control boards for electric power houses and stations 1,330 574 -021 Circuit-breaking apparatus, for household use, not included under Number 1413 301 109 48 Table 12. — Imports of Machinery, Accessories, and Tools, by Commodity Groups and Principal Commodi- ties, Total and From the United States, 1964 continued Tariff number Description Imports United Total States Group 63 — continued 1410-023 Thermostat controls for refrigera- tors 40 12 031 Circuit-breaking apparatus, n.e.s... 2,487 1.536 036 Oil circuit breakers 590 378 -007 Electrical apparatus, n.e.s 1,359 666 1411-001 Spare parts for machines in Group 63 936 498 1412-002 Searchlights and reflectors 53 12 -011 Metal lamps with glass refractors 80 33 1413-003 Apparatus and wares for house- hold lighting networks, n.e.s., other than switches and simple fixtures 47 28 1414-001 Electricity meters 1,043 534 -002 Spare parts for electricity meters 35 17 1415-001 Electric batteries, 1.5 volts 420 173 -002 Storage batteries, of less than 100 kilograms net 166 73 -003 Storage batteries, of more than 100 kilograms net 277 34 -004 Parts for storage batteries, n.e.s... 137 93 -005 Dry cells, other than 1.5 volts 84 20 1417-001 Fuse-plugs, fuse-cartridges and fuses, for electric current 135 73 All commodity groups, total 157.702 74.343 Listed principal commodities, total 156,387 73,958 Principal commodities as percent of total all commodity groups 99.2 99.5 1 Equals zero or less than SI, 000. 2 Category does not include: machinery, n.e.s., for the sugar, cement, tire, paint, nitrate, and metallurgical industries: bench and column drills; three or four-sided planning, spindle-moulding and joining machines: sharpeners for sawblades and machine tools: sharpeners with a more than 20-horsepower multiplier: automatic centrifuge separators: electric hand tools: three-phase bench sand- ing machines; hydraulic, endless band and chain saws: welding and cutting oxygen blowtorches: mechanical forge hammers: machines for printing with ink platens, for classifying fruits and for cutting skins and hides: spinning frames for yarns and threads: automatic machinery for manufacturing, washing and sealing bulbs; shaping rolling mills: universal rectifying machines for machine tools: and lacers and crampers for working leather. 3 Category does not include: apparatus for carpenter's bench, for sewing, for freezing, for printing and lithographing, for laundering, for drying hair: apparatus, n.e.s., for the bed-manufacturing and sugar industries: bench vises; mechanical or hydraulic presses for counterplating; eccentric presses of more than 100 metric tons: cutters for sheets of more than 6 millimeters' thickness: faucets and valves, vapor traps, etc.: ice plants: magnesium crucibles with gold or steel bases: plate shears: electrical equipment for treatment of ferrous metals; and compression meters. Source: Camara de Comercio, Comercio Exterior, Chile, 196U, Santiago, 1965. Note: Principal commodities include all items for which total imports exceed $30,000, or imports from the United States exceed $15,000. The United States is the leading supplier of machin- ery, accessories, and tools to the Chilean market, with sales of $74.3 million in 1964. The U.S. performance was strongest in motive, agricultural, and mining machinery, as has generally been the case in recent years. The average U.S. share of machinery sales dur- ing 1961-64. about 48 percent of total imports, is below the previous four-year average of 55 percent. In 1964. West Germany was second with 16.2 percent and the United Kingdom third with 8.3 per- cent — not very different from their performance in the late 1950's. Other European and Japanese manufac- turers are now offering keen competition in the Chil- ean market. In some cases, credit terms of over 10 years have been extended by these suppliers. France has been prominent among them, claiming fourth place with an average of slightly under 5 percent of the market since 1962. Continued substantial growth for machinery sales seems likely. The magnitude of such growth to a great extent depends upon Chile moving forward with large-scale investments in copper mining. The devel- opment of new industries, such as the petrochemical industry; the expansion of existing ones, such as pulp and paper; the growth in demand for consumer goods which cannot be imported, such as textiles; and Gov- ernment policies giving priority to agriculture should contribute to increased imports of items in this cate- gory. The magnitude of machinery imports will, to a great extent, depend upon the availability of external financing on liberal terms. Importers of machinery have felt the limiting effect of the Chilean Govern- ment's policy that urges them to seek financing for their imports with unusually long repayment terms — - often in excess of 8 years. However, Chile is receiv- ing, and should continue to receive, large-scale foreign financing, a large portion of which may be used to finance the importation of machinery, accessories, and tools. Further success of the Government's economic stabilization program and the confidence which would be engendered by successful implementation of the copper investment agreements should produce a sub- stantial inflow of private capital into Chile for pro- ductive projects now under consideration or in ad- vanced stages of planning. United States machinery should continue to re- ceive a boost from the substantial U.S. economic as- sistance program in Chile ( discussed in Chapter I ) by far the greatest part of which goes for the financing of imports essential to the Chilean development pro- gram. In June 1965, the Central Bank authorized the exemption from certain surcharges and prior deposits of imports of capital and other high-priority goods financed under the U.S. program loan. The selection is made on a case-by-case basis. The program loans for 1964-66 have also included provisions that a portion of those loans be reserved for purchases by the public sector. In early 1966, AID concluded a special SlO-million project loan for the purchase of capital equipment on extended credit terms. The Chilean Government announced that the loan would be used primarily for the purchase of mining equipment for the medium and small mining industry. Mining Machinery, Implements, Accessories, and Tools Chile is almost wholly dependent upon imports of equipment for its vital mining industry. Imports classi- fied as mining machinery, implements, accessories, and tools, however, have not accounted for a particu- larly large portion of machinery imports in recent 49 years. They have never accounted for more than 5 percent of overall machinery and equipment imports in the 1955-64 decade and more often have been closer to the 4.1 percent ($6.4 million) in 1964. But this is deceptive, since a very large volume of equip- ment for the mining industry is included under other classifications, such as transport machinery where it is usually not identifiable as mining equipment. Com- ponents and spare parts accounted for 38.8 percent of imports in this group in 1964. Local manufacturing does account for some pro- duction, such as certain types of hammer mills, cus- tom-made power-driven overhead cranes, rock crush- ers, Decauville mine cars, concrete vibrators, flota-- tion cells, and castings. But production is largely limited to the more simple type of equipment. The U.S. share of this market (61.5 percent — $4.0 million in 1964) has fluctuated in response to the timing of mining projects and the source of their financing, accounting for as high as 91.8 percent (1956) and as low as 52.5 percent (1962) in the 1955- 64 decade. France and West Germany have made the next best showing in recent years, alternating in second place, with 14.3 and 13.8 percent of such im- ports, respectively, in 1964. Most imports by the Anaconda, Kennecott, and Cerro copper companies, the Bethlehem-Chile Iron Mines, and the Anglo-Lautaro Nitrate Company are made in New York, N. Y., through the centralized purchasing offices of these companies. The medium and small mining companies usually purchase their requirements through distributors in Chile. In the next section of this report an attempt is made to indicate planned activities in the various sectors of the Chilean mining industry. It has been convenient to describe entire mining projects, rather than just those parts of them which might be expected to generate sales of products, in the statistical group, Mining Machinery, Implements, Accessories and Tools. Copper. Law 16,425 of January 25, 1966 is de- signed to provide the legal basis for a major expan- sion of the copper mining industry and for an increase in domestic refining and fabricating facilities. The law provides for the participation of the Chilean Govern- ment in mixed mining corporations and gives the Gov- ernment a decisive voice in copper sales policy. (See Chapter II for a discussion of these arrangements.) Most of the machinery and equipment required for these operations will be purchased through the central purchasing offices of these companies in the United States. Since these companies follow a policy of pur- chasing as much of their needs as possible from Chilean suppliers, the investments should also stimu- late demand for components and materials to be incorporated in domestic products. Anaconda Copper Company. Projects with an esti- mated cost of $145 million are designed to increase annual production of copper by 209,000 tons. About 50 million has already been expended. Of the re- maining $135 million, it is estimated that about one- half will go for the purchase of equipment and mater- ials in the United States and the remainder for purchase of goods and services in Chile. Most of the increased production is to be obtained from a new ore body — the Exotica — adjacent to its Chuquicamata pit operation. The latter and the company's El Salva- dor mine will supply the balance of the increase. Anaconda will also participate jointly with the Chil- ean Government in the formation of an exploration company to seek and evaluate new ore bodies both on Anaconda claims and on state-administered land. Refining capacity is to be increased from 193,000 to 523,000 tons annually. Anaconda has further agreed to study the formation of a new national manufactur- ing industry with which it may associate for the purpose of exporting fabricated copper products. There will also be an expansion of housing and school facilities for workers. The domestic construction industry will supply almost all requirements for those facilities. Acquisitions for Chuquicamata will include power shovels and other earthmoving equipment; hauling equipment, primarily trucks, during the initial 2- to 3-year stripping operation and two large conveyor belt systems; tools: drills; railway equipment, includ- ing locomotives, cars, and trucks; equipment for concentrating, smelting, and refining facilities; pipe- lines for additional water supplies; and enlargement of power-production and transmission installations. The latter involves conversion from use of petroleum to domestically produced coal as a stimulus to Chile's depressed coal-producing industry. Mining extraction, smelting, and refining operations are expected to feature increased automation. Expansion plans for Anaconda's El Salvador mine will require the purchase of some new equipment for the mine, concentrator plant, and the smelter at Potrer- illos. The current enlargement of the electrolytic re- fining facility at Potrerillos will require an expansion in the generating capacity of the company's Barquitos powerplant. Kennecott Copper Corporation. The mixed corpora- tion with 51-percent Chilean participation which is to operate the El Teniente mine is expected to increase annual production by 99,000 tons. Refinery capacity is to be increased from 303,000 to 771,000 tons annually. The Government's participation involves a payment of $80 million to Kennecott and a loan of $20 million, both of which are to be reinvested in increasing productive capacity. An additional $100 million is to be sought from other sources, including the Eximbank. Eximbank financing would assure the importation of a large volume of equipment from the United States. The expansion of the El Teniente mine — already the largest underground copper mine in the world with proven reserves of about 2.2 billion tons of cop- per ore — will require both the construction of new facilities and the enlargement of existing ones. These projects include: the driving of an additional tunnel (below an existing one) for transport of ore fed from above to a mill at the site; construction of rail facili- ties and acquisition of rolling stock for use within the mine; construction of a new mill; enlargement of the concentrator plant and the sulfuric acid plant which supplies it; construction of pipelines to move the concentrate to the Caltones smelter several miles away; construction of power transmission lines be- tween Kennecott's Coya powerplant and El Teniente; construction of new dams at Pangal and Los Patos and enlargement of an old one at Sapos; and addition of power-generating facilities at Pangal. The com- pany will also construct a 27-mile, hard-surfaced highway leading from El Teniente through Caltones to Rancagua; revamp communications facilities; and construct various maintenance and storage buildings. Cerro Corporation. Investments of $81 million in the development of the Rio Blanco mine, northeast of Santiago, are expected to result in the production of 72,000 tons of copper annually in the form of concen- trates. By 1965, $10 million had already been spent in preliminary work, and Cerro was seeking external financing of $45 million. Eximbank financing of this venture would result in nearly all imported equipment being of U.S. origin. The project involves sinking a 2,000-foot shaft, at the bottom of which the primary crusher is located, to connect with a four-mile tunnel. After block caving, the ore will move by conveyor belt to the crusher and then on to the underground concentrator plant at the end of the tunnel. The tunnel will also contain an electric railway. A pipeline will carry the concentrate more than 40 miles to a filter plant to be built near Los Andes. Another pipeline will dispose of tailings nearby. Besides equipment for building these installa- tions, earthmovers, trucks, tools, and conveyances for personnel will also need to be imported. The Chilean Government, as part of its proposed 25-percent equity participation, will supply the electric-power needs of the project through expansion of facilities. The state railway will transport an increasing portion of the concentrates each year to the Government smelter and electrolytic refinery at Las Ventanas, while the re- mainder will be exported. Cerro has agreed to sell about 2.5 million tons of concentrate to three Japan- ese firms in return for $20 million in credits over 5 years. Medium and small copper mines. Encouraged by the strong demand for copper at the beginning of 1966, the Chilean Government announced a five-year plan to increase output of the medium- and small-sized copper mines from 110,000 to 242,000 tons annually. The program envisages reform of the Mining Code to reactivate dormant mining properties and the provision of economic and technical assistance to the small miner. The extension of guarantees on foreign ex- change, taxation, and other benefits conferred by the new copper law (No. 16,425 of January 25, 1966) is also expected to spur production. In September 1964, ENAMI inaugurated a $20- million copper smelter to process ores from the medium and small mines of Tarapaca, Antofagasta, Coquimbo, Aconcagua, Valparaiso, Santiago, O'Higgins, Aysen, and Magallanes provinces. The Las Ventanas smelter is expected to process over 165,000 tons of ore and concentrate annually, with potential for expansion to 495,000 tons. The $25- million-plus electrolytic refinery portion of the com- plex, designed for an output of 93,000 tons annually, should be completed in 1966. ENAMFS Paipote smelt- er will continue serving mines in Atacama Province. CORFO was expected to report in mid-1966 on a proposed copper smelter in the Antofagasta area for which private capital participation might be welcome. Compania Minera Disputada de las Condes, S.A., a subsidiary of Societe Miniere et Metallurgique de Pen- arroya, is engaged in a major expansion program which had nearly doubled monthly ore production to 143,000 tons by December 1964. ' Empresa Minera de Mantos Blancos, S.A., owned by the Mauricio Hochschild interests, is Chile's fourth largest producer and is now operating at near ca- pacity levels and could not increase output without a refinery expansion program. Compania Minera Carolina Michilla, owned by Compania Minera y Comercial Sali Hochschild, S.A., was to begin work at the end of 1965 on a $3.5 million concentrator plant on Michilla Bay to serve a new property with estimated reserves of 2.2 million tons of copper ore ( 2.5 to 3 percent copper ) . The project includes a leaching plant, a sulfuric acid plant, and a five-stage, flash-evaporator desalination instal- lation. Hochschild planned to begin work in 1965 on a $1.3 million modernization and enlargement of its Copiapo plant — including mechanization of the re- ceiving area, a new crushing plant, and an additional leaching plant. The Compania Minera Chanaral y Taltal, with the assistance of CORFO, in late 1965 began preparation of a leaching plant on their San Pedro de Cachiyuyo property. The foreign exchange cost of the project has been estimated at 1.82 million escudos (November 1965 ) plus $275,000. The plant capacity will be 220.- 000 tons of ore daily, producing the equivalent of 1,500 tons of copper annually. A joint study by the Sociedad Minera Cutter Cove and ENAMI in 1065 has resulted in work preliminary to exploitation of an ore body in the Cutter Cove area at the extreme western tip of the Brunswick Penin- sula in Magallanes Province. This deposit, abandoned 51 STEEL PLANT: Blooming Steel Mill of Cia. de Acero del Pacifico, Talcahuano, Chile. in 1912, has reserves of 440,000 tons (3 to 4 percent copper) which may prove to be as high as 1.7 million tons. A 220 ton-per-day concentrator, signifying an investment of $1 million, was under consideration for upgrading the ore to 25 percent. Iron Ore. Total production in 1965 was 14,018,500 tons of which more than 85 percent represented the output of CAP, Bethlehem-Chile Iron Mines, and the Santa Fe Mining Company. The 1961-70 development plan called for a 6.6-million-ton increase in pro- duction. While production increases have not occurred as rapidly as envisaged in the plan, several factors suggest that the industry will continue to maintain a strong growth pattern. Among these are greatly ex- panded shipments to Japan, Europe and LAFTA, expansion of Chilean steel-producing facilities, and continued investments in the enlargement and upgrad- ing of large Chilean iron mines. Small operations are not likely to expand their activities greatly unless there is a substantial improvement in the price for ore. Developments which could stimulate the expansion of ore-producing facilities include: 1. Santa Fe Mining, controlled by Minerals and Chemicals— Phillips Corporation — Chile's largest iron ore producer — has plans for investing $30 million over a 10-year period, mostly for improving present equip- ment for the upgrading of ore from existing facilities. 2. A fluid iron ore reduction process being tried out by the Standard Oil Company (New Jersey) at a pilot plant in Halifax, Canada, is being observed with in- terest in Chile by both ore exporters and CAP since Chilean ore averages about 2 percent less than the commercially desirable 65-percent ore. 3. While neither CAP nor Bethlehem have plans for further expansion after completion of recent improve- ment projects, an increase is technically feasible, should demand warrant an expansion. 4. Geological surveys undertaken in 1964 by CAP of its Algarrobo mine and adjacent sectors indicate reserves substantially larger than once thought — per- haps as much as 66 million tons. They were expected to justify major production increases in 1965 — per- haps by 32 percent. 5. The Compania Minera Santa Barbara hopes to join the ranks of major producers with an annual output of 2.2 million tons by the end of 1966. The company has been exploring the possibility of acquir- ing additional mining properties. 52 6. Exploratory operations suggest possible further evelopments of iron mining in these areas: (a) Preliminary estimate by CORFO of a 77- million-ton, high-grade ore body at Boqueron- Chanar, north of Vallenor. Its location, deep within alluvial sediments, would require large investments, resulting in Chile's first major subsurface iron mine. (b) CAP investigation of magnetic anomalies appearing in the Anuanuca and Alcaparra areas. (c) Santa Fe continued its detailed study of the El Laco deposit, potentially one of the largest in Chile. Other Minerals. Nitrate. Although the Chilean itrate mining industry faces severe competition in the orld market from synthetic nitrates, production has een growing at a moderate rate and should continue > grow, because of rising domestic consumption and le aggressive research and sales effort of the Anglo- autaro Nitrate Company in support of the Chilean itrate Sales Corporation (COVENSA). Anglo- autaro, which produces more than 85 percent of hilean nitrate, has been making annual investments of etween $l-$2 million to increase operating efficiency id to diversify production. Pilot-plant production of )dium sulfate and boric acid is underway. Molybdenum. While Chilean molybdenum produc- on is expected to rise sharply as a by-product of xpanded copper mining operations, the Chilean overnment is supporting studies related to the de- ilopment of mines whose primary product would be olybdenum. Pilot experiments are now underway to stermine the feasibility of domestic production of rro-molybdenum. Sulfur. The Chilean sulfur industry sees bright rospects ahead. Plans for installation of a triple uperphosphate fertilizer plant and expansion of the opper. steel, paper, oil refining, and agricultural in- lustries should boost demand. While a good portion f the requirements will probably be met by an in- rease in sulfur extraction from smelter fumes and le roasting of pyritic materials, the actual mining of ulfur should also be stimulated. Chile was already xperiencing a severe shortage of sulfur and sulfuric cid in 1965, and it was estimated that 41,000 tons f sulfur would have to be imported in that year. Sociedad Azufrera Ancanquilcha, in conjunction vith the Mantos Blancos Mining Company, has been tudying means of increasing sulfur output by about .3,000 tons annually, through modernization and en- argement of existing facilities for treating sulfur :aliche. A recent mineral survey indicates a large ulfur deposit near Arica. Sodium Chloride. Production of salt totaled 120,- 000 tons in 1964, twice that for 1963, and production is expected to increase further. Wells (Chile) Con- tratistas Mineros has joined with Compania de Punta de Lobos to form Compania Sal-Chile to carry out a major expansion of production from the Salar Grande deposits south of Iquique. The absence of overburden and the salt's average purity of 99.8 percent make open pit methods possible. After blasting, the material would be moved by front-end loaders directly into truck-trailer combinations, and transported to a nearby port for crushing and screening. The company's plans called for production of 386,000 tons annually, begin- ning in 1965, for domestic consumption and for export to Brazil and Japan. Mercury. Chile's sole producer of mercury (14 tons in 1965) has encountered a severe shortage of exploit- able ore. With the assistance of CORFO it is carrying out explorations, particularly in areas indicated as promising by a United Nations Special Fund team. Apatite. Chile's only producer of apatite, although experiencing financial difficulties in 1964, is studying plans to increase output through new processing tech- niques. Perlite. The Perlita Compania, Ltda., a Chilean mining group with claims in the Laguna de Maula, has been investigating the mining of this volcanic glass that is used for insulation and plaster aggregate. The exact extent of these large reserves is not known. Agricultural Machinery, Implements, and Tools 1X The value of imports in this group has declined steadily from a total of $8.3 million (6.3 percent of overall machinery and equipment imports) to $5.0 million (3.2 percent) in 1964. Imports during those years were at about the same levels as those in the mid-1950's. However, the Chilean Government has at- tached a high priority to agricultural development. This emphasis on increased agricultural production should provide encouragement to agricultural equip- ment sales. Sales to farmers are largely financed by the Chilean State Bank (Banco del Estado de Chile) through credits to importers of machinery and by CORFO on credits ranging from 3 to 5 years. A factor limiting imports, however, has been the requirement, deemed necessary because of foreign debt renegotia- tions, that importers of agricultural equipment seek credit terms in excess of 51/> years. Another problem for farm implement dealers is that they must maintain a very large inventory of spare 11 This group does not include tractors and farm earthmovinR equipment, which are discussed under the next section. Transport Machinery, Materials and Accessories. 53 parts in stock to anticipate future demand. This re- sults from delays produced by import control pro- cedures. Air freight orders have been known to take several months for final delivery. The Government attempted to alleviate this situation in September 1965 by eliminating prior import registration and deposit requirements for spare parts valued under $500 when imported by end-users themselves. Imports of com- ponents and spare parts represented 22.4 percent ($2.5 million ) of agricultural machinery imports in 1964. United States sales have reflected the overall decline in agricultural machinery sales. But despite consider- able annual fluctuations, the United States has man- aged regularly to supply about 50 percent of the mar- ket during 1961-64 (57.7 percent— $2.9 million in 1964) after slipping from as much as three-fourths of the market in the mid-1950's. The United Kingdom has gradually improved its position, supplying 33.8 percent ($1.0 million) in 1964. West Germany has ordinarily supplied between 10 and 15 percent of the market, but its sales were negligible in 1964. Belgium and Canada also supply small quantities of agricul- tural machinery and equipment. Chile is wholly dependent on foreign sources of supply for cultivators and weeders, most harrows and rollers, seeding and fertilizing machinery, agricultural sprayers and dusters, combines, pick-up balers, all other haying machinery, irrigation distribution equip- ment, dairy farm equipment and machinery, poultry farm equipment and machinery, and farm-type ele- vators and blowers. Chile does produce certain types of small harrows, plows, farm wagons, and trucks (nonmotor powered), agricultural sprayers and irrigation equipment, seed- ers, corn shelters, potato graders, fertilizer spreaders, and grain dryers. Many of these are copies of import- ed models. Nonprecision spare parts are also pro- duced. The Government has authorized a Chilean firm, Mauricio Hochschilds, S.A.I.C., to manufacture discs for plows, harrows, and seeders under license and technical supervision of a British firm. Planned production of the completed items will eventually be sufficient to supply the entire domestic market plus some exports to neighboring countries. Machinery, Accessories, and Tools for Industries and Trades This group, the largest in the category "Machinery, Accessories, and Tools," comprises a very wide variety of items; including machine tools and general ma- chinery and equipment for Chile's leading industries — textiles, foodstuffs, steel, chemicals, and rubber — and other manufacturing industries. It is also one of the fastest growing and represented 63.3 percent ($99.8 million) of machinery imports in 1964; such imports averaged 56 percent during the 1959-61 pe- 54 riod. During Chile's industrial expansion of t early and mid-1950's, this group represented an ev< larger percentage of overall imports. Liberal impc duty exemption provided by Chile's Foreign Invei ment Law and similar legislation affecting domesl industries have in the past done much to encoura new investments and the importation of a large volur of machinery and equipment. Table 17, Appendix shows indices of Chilean industrial production ai provides some indication of the growth in denial for industrial equipment. The largest identifiable items in this group 1964 were cranes, derricks, and other lifting machine metal replacement appliances (attachments) for m chinery; pumps; conveyor machines; textile machi ery; air compressors; domestic sewing machine commercial refrigeration equipment; lathes and to sets. Components and spare parts constituted 19 percent of all imports in this group in 1964. Unspec fied machinery and unspecified apparatus togeth accounted for another 39.8 percent. 12 While the total value of U.S. sales has grown su stantially, the United States has seen a steady c cline in its share of the market from 1959 (55 percent— $29.8 million) to 1964 (45.0 percent— $45 million). West Germany, whose sales had grown nearly a quarter of the market in 1961, supplied 16 percent in 1964. The United Kingdom, with 5.3 pe cent in 1964, has regularly occupied the third positio Several other countries have enjoyed a substanti growth in sales. Thus, both Denmark and Canat were a hair's breadth behind the United Kingdom 1964, each with sales totaling more than $5 millio French, Swiss Brazilian, Italian, Argentine, Norwe ian, and Swedish sales amounted to between $1.' $3.0 million each. Chile is almost entirely dependent on foreign sourc for the supply of machine tools, accessories, met; working equipment, and other industrial equipmer The domestic machinery manufacturing industry h grown out of iron and steel foundry operations. Son foundries and metalworking plants are modern ai efficient, and many of the leading industrial firr have well-equipped machine shops with up-to-da American and European machine tools. Many, ho^ ever, have obsolescent equipment and often have dif culty in meeting quality standards. The former a capable of producing fairly complicated machine tool often copies of foreign models, on a custom basi Some of the largest and most efficient, which produ for their own needs, are those run by the large minir companies, the steel mill, the Chilean Military Arse als, the Chilean State Railroads and the Chilean Na^ Dockyards at Talcahuano. 12 To make these two statistical classifications more meaningf footnotes to these items (1358-025 and 1359-013) in text table indicate, so far as possible, what items are excluded. But for the most part, production is limited to small quantities of light machinery, equipment, and parts of simple design such as drills, presses, bench and column drill presses; small engine-lathes; shaping machines; milling machines; grinding mill machines, horizontal boring mills; hand forming rolls; polishing stands; pedestal grinders; small drop hammers and crank presses; simple centrifugal, rotary and piston- type pumps; small ovens and welding equipment; simple centrifugal, rotary and piston-type pumps; industrial ventilators, commercial air-conditioning and refrigeration equipment; trailers; stackers; small hoists: bakery, meat cutting, canning, fruit drying, dairy, soda fountain and beer dispensing equipment; stainless steel appliances; steel foundry parts, and various types of handtools. Some of these items are not produced on a continuous basis. CORFO has investigated the prospects for local pro- duction of domestic sewing machines, machine tools, and forged tools (pickaxes, hoes, axes, wrenches, pliers, hammers, files, rasps, spades, and tweezers). It is calculated that their production would result in foreign exchange savings for Chile of $1.0, $1.3, and $0.35 million annually. The Singer Company has be- gun production of sewing machines that use imported Brazilian motors. Chile now supplies about 25 percent of its own machine tool needs, and a CORFO study calls for meeting Chilean needs for certain basic machine tools by 1970 through annual production of 97 bench lathes, 181 universal lathes, 139 bench drill presses, 59 pedestal drill presses, 38 reciprocal-type saws, and 16 endless blade saws. Total investment for such a factory is estimated at $399,000, plus the equivalent of $616,- 000 in Chilean currency. The United States now sup- plies about 20 percent of such imports and might lose sales of about $200,000 annually to domestic produc- tion. Argentine sales would be the hardest hit. The limited market and high prospective cost of such production (2 to 3 times higher than current world prices) has presented serious obstacles to these plans. Motive Machinery, Boilers, and Spare Parts Except for domestically produced small electric motors ranging from % to 20 horsepower, some steam-generating and pressure water-heating boilers, and limited quantities of transmission and conveyor belting, Chile is largely dependent upon imports to satisfy requirements for goods in the group, motive machinery, boilers, and spare parts. As is the case with other machinery imports, components and spare parts account for a large porportion of these imports, 40.7 percent ($8.3 million) in 1964. Imports in this group have averaged 12.5 percent of overall machinery imports during 1961-64 and totaled $20.3 million (12.9 percent) in 1964. This group, in earlier years, represented only a slightly higher percentage of overall machinery imports. The U.S. share of this market averaged 58.5 per- cent during 1961-63, but dropped to 51.5 percent ($10.5 million) in 1964. Its share during the first 6 years of the 1955-64 decade ranged between 55.6 and 67.0 percent. The U.S. sales were heaviest for internal combustion engines, engines for fishing boats, and components and spares ($5.7 million — 54.5 percent of U.S. sales) in 1964. West Germany sales averaged 15.4 percent of the market during 1961-63, but dropped to 12.9 percent in 1964. British sales, how- ever, jumped to 21.5 percent of the market in 1964, after averaging 9.9 percent during 1961-63. Electrical Machinery, Apparatus, and Material Although Chile has made important strides in recent years in the manufacture of electrical machin- ery and equipment, and is practically self-supporting in some types of electrical equipment and supplies, neith- er heavy electrical machinery nor specialized equip- ment is produced. Thus, the expansion of Chilean power-producing and telecommunications facilities has led to greatly increased imports of items in this group. This growth accelerated during the late 1950's, and grew to an average 21.0 percent of overall machinery and equipment imports during 1959-62. Sales represented 18.9 and 16.6 percent of overall machinery and equipment imports in 1963 and 1964, respectively. However, the absolute value of such sales totaled $29.0 in 1963 and $26.2 million in 1964. Indi- vidual items for which sales were heaviest in 1964 included telephone plant equipment. 1:; circuit breaking equipment, transformers, copper cables, power gen- erating machinery, powerplant distribution and control boards, electron tubes (valves), and electricity meters. The U.S. share of the electrical equipment market has fluctuated between 38.4 (1961) and 61.4 (1958) percent during the 1955-64 decade. The U.S. sales averaged $11.4 million annually during 1961-64. Sales totaled $12.5 and $11.7 million— 50.5 and 44.7 per- cent of the market — in 1963 and 1964, respectively. The largest U.S. sales in 1964 coincided with the major items listed above plus spare parts. The United States supplied at least one-half the market for all of those items except copper cable and power distribution and control boards. West Germany has ordinarily supplied between 16 and 21 percent of the market in recent years (19.4 percent in 1964), with sales scat- tered through a wide variety of products, but sales were heaviest in telephone plant equipment ($1.4 mil- lion ) in 1964. France and the United Kingdom have alternated in the third position in recent years, with 13 Telephone receivers and transmitters are listed under Group 70, Articles and Instruments for Science. 55 each ordinarily supplying between 7 and 13 percent of the market. French sales in 1964 ($2.7 million) were composed largely of telephone plant equipment ($1.8 million). Chilean production of electrical equipment now includes electrodes; transformers; voltage regulators; switch gear; circuit breakers; copper wires and cables; lighting equipment, including incandescent and floures- cent lamps, lighting fixtures, ballast and starters, metal reflectors and fittings, attachment plugs and caps, out- lets, lamp sockets and receptacles, conduits and fit- tings, insulators and insulating material, and outlet switches; storage batteries, including those for auto- mobiles; and a few of the most commonly used elec- tron tubes. 14 The production of electron tubes has been encour- aged by the conclusion of a Complementarity Agree- ment, on February 18, 1964, for trade of this product between Argentina. Brazil, Chile, Mexico, and Ura- guay under the terms of the treaty which established LAFTA. Chile has shown interest in making other electrical products the subject of such agreements. Chilean production of electrical energy nearly doubled between 1950 and 1964. Installed generating capacity totalled 1,490,000 kw. in 1964. Most future growth is expected to take place in the public service sector. Public power is expected to total 1,247,000 kw. of installed capacity by 1967 and 1.600,000 kw. or more by 1972, depending upon the development of plans now under consideration by ENDESA. Most of this power will be tied into a system connected by 154- kilovolt and 110-kilovolt primary transmission lines extending from Copiapo to the Island of Chiloe. Table 20. Appendix D shows the growth in Chilean con- sumption of electric power by category of consumer between 1950 and 1964. See the section, "Power " in Chapter II: Basic Data, for a description. The IBRD has been a primary source for the finan- cing of Chilean power development. Through 1964, it had loaned $61 million which had been used to install 589,000 kw. of new generating capacity. The Rapel 350,000-kw. project, to which the bank contributed financing, will probably be completed in 1970. In February 1965, the bank announced a $4.4 million loan, a good part of which has not yet been disbursed, to finance an interim power program for construction of small power-generating facilities in Antofagasta and Punta Arenas and a submarine cable to the Island of Chiloe. for improvement of its transmission and distri- bution system, and for improving its planning function. Future projects may include those to serve the growing Concepcion industrial area: (1) the 100,000 kw. Bocamina thermoelectric plant to be completed in 1969 with construction beginning in 1966 at a cost of $22 million pi us ■).) million cscurlos a nd ih 400,000-kw. El Toro hydroelectric installation to be completed in 1971 for which some preliminary work has begun. Rural electrification is being emphasized, for only 8,017 out of 169,136 farms received electric service as of 1964. The first stage of the program calls for in- creased distribution of power to areas closest to exist- ing transmission lines and to those with highest popu- lation density. In support of this program, AID au- thorized a $3.3-million loan in early 1965 to finance electrification projects by 14 cooperatives throughout the country. It aims at adding 1,475 miles of distribu- tion lines to 2,252 miles now in service, at improving existing power and light facilities, and at providing service to 5,491 previously unserved members in addi- tion to the 3,489 members now served. 15 It is hoped that the project will increase agricultural productivity by making possible the application of power driven machinery to such farm tasks as pump- ing water for homesteads and irrigation, furnishing economical refrigeration, and providing power for small machinery, lighting, and communications. Rural electrification should also encourage the development of poultry- and grain-processing plants, small canning plants, and handicraft. Increased activity of this type should boost the demand both for electrical equipment imports and for domestically produced equipment. The immediate direct impact upon demand for imports is relatively small, since Chile manufactures concrete poles, copper conductors, and transformers. However, Chile still must import steel cores and paper insulation for transformers in addition to suspension insulators, oil circuit reclosers and sectionalizers, meters, hot-line working tools, oil-testers and filters, and steel guy wires. The Chilean Government in February 1965 an- nounced a new program for the development and in- tegration of the nation's public and private communi- cation facilities. The program calls for: '1 • creation of a Government telecommunications enterprise ( Em- presa Nacional de Telecommunicaciones — ENTEL) which will own and operate the basic channels of communication, principally the long-distance backbone microwave network: (2) construction of this micro- wave network which would eventually connect all provincial capitals and principal cities by telegraph, telex, radio, television, and telephone channels which the enterprise would lease to private users; (3) an in- crease to 49 percent of Chilean equity participation in CHILTELCO, a subsidiary of International Telephone and Telegraph Company (ITT) : and (1) a 5-year, $125-million CHILTELCO expansion program aimed at raising the number of phones per 100 inhabitants from 2.8 to 1.1. The ITT will also seek to expand ]t Other audio-electronic equipment is listed under Group T.K Articles and Instruments for Science. 56 15 Members are not usually single users, since a large farm may include 10 to SO workers' homes; or small service villages every few miles apart may include 30 to 50 homes with 3 or 4 small stores, a municipal water system, and 50 street lights, all of which are served as a single member. CHILE POWER: Hydroelectric power continues to be produced in this powerhouse, the Abanico hydroelectric plant, of Empresa Nacional de Electricidad. domestic production of CHILTELCO's material re- quirements through ITT's Standard Electric subsidiary to the point where 88 percent of these may be procured locally. The provisions involving CHILTELCO are embodied in an agreement between the company and the Government. The agreement awaits ratification by the Chilean Congress. A contract to construct telex exchanges of the crossbar type in Vina del Mar, Rancagua, San Fern- ando, Curico, Talca, Linares, Cauquences, Chilian, Concepcion, Los Angeles, Angol, and Arica was award- ed to a Swedish firm in October 1965. This first stage of a Department of Post Offices and Telegraph project is to be completed in 1968. A second stage, beginning in 1968, will extend telex facilities to 12 more cities — in addition to those already in Santiago, Antafagasta, Valparaiso, and Punta Arenas — by 1970. The AID is considering a loan to finance a feasibility study which would deal with all aspects of an integrated telecom- munications system, including the Communications Satellite Agreement, of which Chile is a Signatory. TRANSPORT MACHINERY, MATERIALS, AND ACCESSORIES The value of imports in this category has probably fluctuated more sharply from year to year than any other major import category. In the 1955-64 decade, it has totaled as low as $42 million (1959 — 10.2 percent of all imports), and as high as $115 million (1961 — 19.5 percent of all imports ) . The level of imports has been more stable in recent years, averaging a little more than $76 million annually during 1962-64. The level of such imports has depended to a very great extent upon availability of external financing and the Government import policy. Automotive equipment (in- cluding tractors and earthmovers ) and railway equip- ment have accounted for the bulk of such imports, but there has been a modest increase in sales of maritime and aviation equipment. Table 13 shows Chilean im- ports of transport machinery, materials and acces- sories, by commodity groups and principal commodi- ties, total and from the United States in 1964. The United States is the leading supplier of trans- portation equipment, with 36.7 percent ($27.1 million) of the market in 1964. However, its position has erod- ed since 1959 when it supplied 63 percent of the mar- ket. Greatly expanded competition from European and Japanese suppliers in automobile and railway equip- ment sales, the increased importance of maritime equipment sales for which the United States has not been a leading competitor in recent years, and Euro- pean sales of aviation equipment are responsible for this decline. France, which trailed the United States with 22 percent of the market in 1964, held the 57 Table 13. — Imports of Transport Machinery, Materials and Accessories, by Commodity Groups and Principal Commodities, Total and From the United States, 1964 [Thousands of dollars] [Thousands of dollars] Tariff number Description Imports United Total States Group 64 Railway and tramway equipment and material 1419-001 Fixed seats for automobiles 1421-002 Self-propelled rail-cars, less than 10,000 kilograms 1422-001 Bogies 1423-001 Track switches -002 Crossings -003 Derailers -004 Frogs 1424-001 Cars with cabs -004 Freight cars 1425-001 Freight cars for temporary or portable railways -004 Track-inspection and repair cars.. 1427-001 Passenger cars 1428-001 Fishplates or binding plates -003 Material for railway permanent way, n.e.s., other than sole plates 1429-001 Semaphores and signaling ma- terial, n.e.s 1430-001 Locomotives, steam -002 Locomotives, electric -011 Locomotives, combustion -012 Locomotives, internal combustion 1431-001 Infrastructure components for cars and locomotives 1432-001 Rails 1433-001 Axles, more than 50 kilograms net -003 Wheels, more than 50 kilograms net 1434-001 Axles, up to 50 kilograms net -002 Tires, up to 50 kilograms net -003 Wheels, up to 50 kilograms net .... 1439-001 Components and spare parts, n.e.s., for machines and ap- paratus Group 65 Watercraft and navigation material.. 1440-001 Anchors and grapnels of iron 1441-001 Compression apparatus for divers -005 Watertight suits for divers 1445-002 Shackles 1448-001 Floating docks 1450-001 Watercraft, of steel, non-seagoing -002 Watercraft, of wood, non-seagoing 1452-001 Watercraft, fitted for fishing or preservation of fishery products 1453-001 Watercraft, other than for sport, to -021 n.e.s 1456-002 Beacons -003 Signaling apparatus, n.e.s., other than light buoys for air, sea, or land routes -004 Accessories and spare parts for signaling apparatus 1458-001 Propellers 1460-001 Life buoys 15,716 26 20 673 162 45 20 24 60 296 221 55 122 304 445 116 5,455 477 68 835 4,816 188 218 31 85 52 730 7,408 92 82 39 91 84 222 37 1,225 4,454 321 320 107 159 35 4,043 15 20 138 157 44 20 24 60 117 40 55 122 169 109 105 46 116 478 443 531 524 37 44 31 83 49 558 679 13 81 12 38 37 191 37 107 81 29 second position on the basis of its sale of three jets to the Chilean National Airlines. France had already dislodged West Germany from the second position in 1963. Locomotive sales put Italy in third-place, with 9.6 percent of the market. The United Kingdom was fourth, with 8.7 percent, as the result of growing tractor sales. A top-level Government Advisory Commission for Transport (Comision Asesora de Transportes^CAT) 58 Tariff number Description Imports United Total States Vehicles, n.e.s., and their compo- nents and spares Airplanes Helicopters Parts, not specified, for aircraft Automobiles Station wagons Jeeps and agricultural jeeps . Buses Trucks Pick-up trucks (camionetas) Panel trucks (furgones) Ambulances Firefighting vehicles Automobile bodies and their parts Cars without mechanical motors .. Automobile chassis Group 66 1462-001 -002 -008 1463-007 to -208 1463-314 to -501 1463-997 to -998 1465-043 to -193 1466-000 to -300 1467-000 to -201 1467-314 to -501 1468-003 to -201 1469-024 to -196 1473-001 1476-001 1480-000 to -169 1480-301 to -421 Tractors 1482-001 Axles, with or without bushings or nuts 1483-001 Headlights and spotlights, and to -003 their components and spare parts 1487-001 Automotive tire casings -002 Automotive inner tubes -005 Airplane tire casings and inner tubes -007 Tractor tires and casings -010 Recapped tire casings 1489-011 Bicycles -013 Parts and spare parts for bicycles 1490-001 Automobile springs, other than shock absorbers 1491-001 Tire patching materials -011 Brake fluid for automobiles 1492-001 Spare parts for vehicles (excludes spares for motors and those ex- clusively for agricultural trac- tors) All commodity groups, total Listed principal commodities, total Principal commodities as percent of total all commodity groups 51,013 22,329 13,868 3,889 75 75 1,232 728 6,314 1,984 398 145 1,009 365 279 139 6,524 4,268 2,020 1,517 671 234 122 101 343 238 206 110 416 182 3,237 1,594 4,618 1,586 149 51 182 131 2,805 933 192 87 96 260 33 50 101 137 90 253 51 134 32 3 92 26 197 5,087 3,343 74,137 27,051 73,688 26,888 99.4 99.4 1 Equals zero or less than $1,000. Source: Camara de Comercio, Comercio Exterior, Chile, 196U, Santiago, 1965. Note: Principal commodities include all items for which total imports exceed $30,000, or imports from the United States exceed $15,000. was established in 1965 to: (1) Coordinate and inte- grate Chilean air, sea, rail, and road transport; (2) plan new investments in the transportation sector; (3) formulate a national transport policy; and (4) plan a new transportation ministry. The Economic Institute of the University of Chile and the State of California through its Chile-California program are providing consultative support to the CAT. Railway and Tramway Equipment and Materials Imports in this group were greatest at the outset of the Ten Year Railway Modernization Plan during 1961-63, reaching $30.8 million (36.2 percent of trans- port imports) in 1962. Such imports totaled only $15.7 million (21.2 percent of transport imports) in 1964 as the equipment procurement program began to lag. Electric locomotives and rails accounted for 65.4 per- cent of all such imports in 1964. Italy, by virtue of its sales of electric locomotives, was the leading supplier of railway equipment in 1964, with 36.7 percent ($5.8 million) of the market. Japan was second — thanks to rail sales — with 28.1 percent. The United States trailed with 25.7 percent, its sales scattered through several categories. Between 1957 and 1962, U.S. sales accounted for about 50 percent to 83 percent of the market, totaling as much as $16 million in 1962, but dropped to 29.5 percent in 1963. Credit competition has been very sharp in this field. The Chilean State Railway (Ferrocarriles del Esta- do), which operates more than 80 percent of Chile's 5,163 miles of track, is launching a Five Year Program (1966-70) which essentially regroups projects left un- done under the 1961-70 plan. The principal items in the new program include: Track modernization. The new plan calls for com- pletion of the continuous-rail replacement program over the Santiago-Puerto Montt route and improve- ment of routes north of Santiago. Electrification. Total investment for railway elec- trification projects is estimated at $15.6 million, to be allocated according to the following schedule; in mil- lions of dollars: 1966. 1.7; 1967. 0.6: 1068. 3.6; 1969, 5.0; and 1970, 4.7. Credit terms are: 5 percent against purchase order, 5 percent against shipping documents, and 90 percent in 16 semiannual payments at 7 percent. The electrification projects include: (1) Valparaiso — Santiago Zone: The modernization of substations and contact lines through the replace- ment of 12 transformers in 6 substations by silicon rectifier converters (2,000/3,000 kw. 3kv. dc). the replacement of catenary contact lines, and the pur- chase of 7 powerline service cars; (2) Chillan-Concepcion and ChiUan-Temuco Lines: The installation of 9 substations (18 transformers) and contact lines, and the purchase of 40 locomotives (seventeen 3,600-h.p. and twenty-three 2,400-h.p.), 19 yard locomotives, and 8 contact-line service cars; (3) Santiago — San Antonio line: The installation of 3 substations and the procurement of 5 locomotives and 3 yard locomotives; (4) The acquisition of two portable electric sub- stations (2,000 kw., 3 kw. dc.) to supplement the new installations: (5) Santiago — Chilian line: The purchase of 26 yard locomotives and 8 self-propelled passenger rail cars for a line now being electrified. Acquisition of diesel-electric locomotives and spare parts. Procurement costs, totaling $21.4 mil- lion, for the purchase of: 1966 10 1.676 meter-gage locomotives 21 1.000 meter-gage locomotives 1969 48 1.676 meter-gage locomotives 6 1.000 meter-gage locomotives The program also calls for the purchase of three locomotives (two of the rack or cog variety) for the Arica-La Paz railroad. Modernization of signalling system. A separate 10-year program, for which details are not yet avail- able, calls for modernization of the signaling and tele- communications system at a cost of $6 million. Acquisition of rolling stock and spare parts. The plan estimates purchases of 7,500 freight and 800 passenger cars, all of which are expected to be produced domestically. Because of an increasing accident rate to which antiquated freight equipment had contributed, the State Railways announced, in 1965, plans to increase replacements of freight cars as well as wheel and axle sets. Three hundred and fifty freight cars were to be replaced in 1965, compared with 120 in 1964. Six thousand axle and wheel sets were to be replaced in 1966, and 3,500 sets in 1965, compared with 1,200 in 1964. Rolling stock operated by the public railways at the beginning of 1965 included 911 locomotives (560 steam, 228 diesel, and 123 electric), 42 self-propelled rail passenger cars (20 electric, 3 diesel electric, and 19 diesel). 130 motorized rail vehicles, 10,092 freight cars and cabooses, and 966 passenger and baggage cars. The Chilean State Railways use equipment standards established in other countries (largely the United States, but also Italy and Germany) as the occasion warrants. The railways' testing office has established some genera] standards pertaining to equipment manu- facture. An office is maintained at 80 Pine Street, New York, NY. Several private companies, such as the large mining companies, operate private railways. Some of these maintain central purchasing offices in the United States. Watercraft and Navigation Material While there has been a modest increase in recent years in sales of watercraft and navigational material, the level of sales has not reflected earlier plans for the purchase of some $91 million in cargo vessels over the 1961-70 period. With few exceptions, sales have been concentrated in fishing vessels and equipment for the northern fishmeal industries. The unavailability of financing for purchases of cargo vessels has limited their acquisition. 59 Importation of items in this group averaged $6.8 million annually in 1961-64 and accounted lor be- tween 4 percent (1962) and 10 percent (1964) of overall transport equipment imports. United States sales were limited to $1.2 million in 1963 and $0.7 million in 1964. Total marine equipment sales were $6.5 million and $7.4 million in those years. France, West Germany, and Denmark were the most significant suppliers through 1964, and were joined by Japan and Yugoslavia in 1965. During the past decade, there has been little growth in the Chilean merchant fleet. In 1965, the fleet was composed of 18 companies which operated 62 vessels of over 100 deadweight-tons with an average age of 17 years. Fifteen of these vessels belong to the state- owned and subsidized Empresa Maritima del Estado (EMPREMAR) . The most recently purchased vessels were four new 11,620 deadweight-ton frieghters by the Compania Sud Americana de Vapores ( CSAV ) . One vessel was delivered in 1965, and the others are scheduled for 1966. Ship construction in Chile is limited to tugs, fishing boats, and similar small craft. Shipyards are not equipped to handle liners, large cargo vessels, or coastal steamers. The exception is the Chilean Navy Dockyard in Valparaiso (Astilleros y Maestranzas de la Armada — ASMAR) which can build craft up to 200 deadweight tons and handle repairs for vessels up to 30.000 deadweight tons. ASMAR, which also does private or commercial work, will soon be able to take on larger and more complete construction jobs. Chile is largely dependent upon foreign sources of materials and equipment for supplv of its shipbuilding and repair industry. This includes machine tools, engines, auxiliary equipment, navigation and communi- cations equipment, and considerable quantities of fin- ished steel. However, a growing amount of finished steel is obtained from domestic production. Vehicles, Not Elsewhere Specified, and Their Components and Spares This category, the largest of the statistical groups for transportation equipment, includes primarily avia- tion and automotive equipment and their components and spare parts. Tractors are also included in this group, but not their spare parts which are covered under agricultural machinery. Total imports in this group, after reaching an $84.7 million peak in 1961 at the beginning of the 10-year development plan and earthquake reconstruction, fell off to a $49.2-million annual average for the 1962-64 period. The group has constituted as much as 86.6 percent of equipment im- ports and accounted for 68.9 percent of such imports in 1964. 60 The U.S. share of this market was 43.9 percent ($22.3 million) in 1964, but it was as high as 65.9 percent in 1959. In 1964, France, because of jet sales, and the United Kingdom, because of tractor sales, had gained the most ground. In this group, in 1964, French sales represented 27.1 percent, the United King- dom, 11.1 percent, and West Germany, 7.0 percent. Aviation Equipment. There are no aircraft manu- facturers in Chile. The market for commercial and military aircraft (including jets), spare parts, motors, propellers, and instruments has been limited by the shortage of foreign exchange and the inavailability of foreign credits. The United States enjoys an advantage in equipment sales because of a previous large pur- chase of equipment by the National Airline (Linea Aerea Nacional — LAN) and the Chilean Air Force. However, its jet fleet will consist of three French Caravelles (purchased in 1964) until Chile is able to purchase a limited number of longer-range U.S. jets. LAN has also been carrying out a limited replacement program for some of its older prop planes. Private planes are imported directly by clients, many of whom are members of flying clubs, whereas spare parts and instruments are retailed by dealers. Automotive Equipment and Traetors. The Chil- ean automotive industry, except for some assembly of trucks and tractors in Santiago, consists of some 18 assemblers of automobiles and light trucks located a thousand miles north of Santiago in the free port of Arica. Except for cars (valued at an estimated $2 million in 1964) imported for use in some of the iso- lated free port areas and those brought in by Chileans who have resided abroad or by members of foreign missions in Chile, completely assembled automobiles have been prohibited entry into Chile since January 1962. However, assembled engines, transmissions, and knockdown body parts are imported into Arica be- cause of certain customs exemptions and tax benefits provided to encourage the automotive assembly indus- try there. Each year Chile has been requiring that a pro- gressively increasing percentage of automotive com- ponents for locally assembled vehicles must be of domestic origin. These percentages were set at 27, 32, and 45 percent for the years 1964-66. However, the requirement was reduced to 30 percent for 1966. The contribution which a particular domestic part makes to this required percentage is the percentage that it represents of the vehicle's total cost in the country of primary manufacture. Chilean parts, which are avail- able for incorporation in the finished product, include sheet metal items, bumpers, hubcaps, glass, seats, up- holstery, brake linings, batteries, tires, and brake fluid. In 1965, there were reports that the Prestolite International Company planned to manufacture spark plugs, coils, condensers, contact sets, and regulators in Chile. CORFO has also been trying to encourage the production of elliptical and semielliptical springs in Chile on an economic scale, but with no success to date. Because of difficulties in building up sufficient inventories of domestic parts, gaining foreign exchange authorizations for imports, and other problems, auto- mobile production in Chile must often be concentrated toward the end of a particular calendar year. Automotive tires and inner tubes represent one of the larger import categories in this group, amounting to $3 million in 1964. INSA is the sole producer of tires and inner tubes in Chile, and its annual tire pro- duction passed the one-half million mark for the first time in 1965. The General Tire and Rubber Company has a minority interest in the company. INSA does not produce airplane, industrial, or motorcycle tires nor does it produce all types of tractor and automobile tires used in Chile. An investment application by the Firestone Tire and Rubber Company has been ap- proved by the Chilean Government, and INSA has also announced expansion plans. In pursuit of integration objectives under LAFTA, Chile has sought to work out complementation arrange- ments with other LAFTA automotive producers, par- ticularly Argentina and Brazil. One concrete result has been an agreement that parts produc d by these countries will count as domestic parts iv computing requirements for use of national production. However, at this time, imports and exports of such components between two particular countries must equal each other. In February 1966, the Chilean Government an- nounced the introduction of a bill in the Chilean legis- lature which, if passed, would lead to a complete re- organization of the industry. The draft bill calls for: (1) Elimination of special tax and customs privileges for producers in Arica within 180 days of the law's promulgation; (2) establishment of an automotive committee headed by the executive vice-president of CORFO to establish a financing and manufacturing program of at least 4 years duration and the setting of domestic component requirements (at least 30 per- cent) ; (3) submission by producers and prospective producers of plans which will be judged for conform- ity to the program objectives, particularly within the areas of minimum production levels, interchange with- in LAFTA, scheduling of investments, and Chilean capital participation of at least 25 percent; (4) the automotive committee's approved transfer of facilities to other parts of the country and its approval for certain tax and customs concessions; and (5) es- tablishment of a 400-percent duty on the c.i.f. value of foreign vehicles and a 150-percent duty on imported parts; procedures are to be set for waiver of such charges under special circumstances. Chilean assembly of automotive vehicles, according to Chilean Government statistics, during the years 1962-64, were as follows: 1962 1963 1964 Passenger cars 5,359 6,643 6,030 Buses Trucks 1,256 1,537 1,528 United States companies operating in Chile in recent years include American Motors, Ford, General Motors, and Chrysler. Trade sources report no significant in- crease in assembly in 1965. Ford, in late 1965, moved to Arica and began production of pick-up trucks in conjunction with a Chilean company and later will turn out Falcons. The Kaiser and Fiat companies have also shown interest. The leading foreign models produced are BMC, Cit- roen, Datsun, Fiat, and Simca. Volkswagen has vague plans for producing in Chile. Altogether, nearly 30 different models are produced from time to time. Table 13 does not give a complete picture of vehicles imported for assembly because it does not distinguish between knockdown vehicles and those assembled personal vehicles which enter under special privileges. Also, depending upon their degree of com- pleteness, unassembled automotive imports appear to be classified under both automobiles and automobile chassis. Data on imports into Arica provide a better picture of unassembled automotive imports although they also include some assembled personal vehicles. Thus, most of the 3.679 automobiles ($3.93 million I, 127 station wagons ($0.13 million), 50 jeeps ($0.87 million), 552 pickup trucks ($0.84 million), 268 panel trucks ($0.22 million), and 1,364 automobile chassis ($1.38 million) imported into Arica in 1964 were probably unassembled. Slightly over 800 of these units were of U.S. make. Domestic production and imports do not go very far in meeting the Chilean need for automobiles. Total needs of all types of automotive vehicles have been estimated to be in the neighborhood of 35,000 annually. Chilean registrations of motor vehicles for the year ending December 31, 1964, totaled 88,744 passenger cars (including station wagons and jeeps), 11,458 buses (including both chassis and complete buses) , and 84,658 trucks. Because of heavy import restrictions and limited production, the proportion of older vehicles is very high; as a result, spare parts and maintenance equipment represent a substantial portion of imports. Chile has a shortage of vehicles, particularly buses and trucks. Many medium- and large-size trucks enter under special customs regimes created to encourage specific domestic industries and are not as much affect- ed by general import prohibitions. No appreciable number of buses was imported between 1961 and 1965. In that year, a crisis in urban transportation generated estimated immediate needs for 1,900 buses and a backlog of demand for about 4,000 buses and 3,000 trucks. There are estimates that, without re- strictions made necessary by foreign exchange short- ages, Chile could absorb 8.500 imported buses and 61 trucks annually. In 1965, Chile, under the AID pro- grams, authorized the emergency importation from the United States of some 600 bus chassis valued at about $4 million. The importation of an additional 1,000 chassis depends to a great extent on Chilean plans for expanding body fabrication facilities. In mid-1965, after a 4-year general ban on truck chassis to the permitted list on a limited basis, and authorized their financing under an AID program which provides incentives for their supply from the United States. Chile is wholly dependent upon foreign sources of supply for wheel, garden, and crawler tractors as well as earthmoving equipment. In the medium-duty field, United States equipment has met increasing com- petition from English, Canadian, and West German suppliers because of price disadvantages, but it con- tinues to hold its own in the heavy-duty field because of the U.S. reputation for quality. Imports of tractors, $4.6 million in 1964, should grow because of the priority given by the Chilean Government to agricul- ture and because of planned mining and construction projects. MISCELLANEOUS MANUFACTURED PRODUCTS This category of imports comprises widely diversi- fied groups of manufactured products not included elsewhere in the Chilean tariff. Scientific articles and instruments (including office machines and certain electronics) and miscellaneous manufactures (largely commercial gear and military equipment), together. are the two groups which have regularly constituted one-half of imports in this category. Imports of ceramics, printed matter, paper products, prepared stones and earths, and rubber and plastic manufac- tures have also been significant. Changes in the level of imports in this category have followed rather closely the changes which have occurred in the overall level of Chilean imports. Thus, during the 1955-64 decade, this category has varied between only 7.0 percent (1958) and 8.5 percent (1963) of total Chilean im- ports. More often than not, the percentage of miscel- laneous manufactured imports has been very near that for 1964, (7.4 percent — $44.9 million). Except for a dip in sales in 1962-63, the United States has ordinarily supplied between 35 and 38 percent of the import market, with 37.4 percent ($16.8 million) in 1964. United States sales were concentrated that year in refractory bricks; books; scientific articles and instruments (in good part, office machines) : and a variety of rubber, paper, and military products. West Germany, primarily on the basis of its sales of scien- tific articles and instruments, had for some time held second place but has slipped somewhat in recent years, supplying 15.4 percent of the market in 1964. The United Kingdom, Italy, and Japan have alternated in the third position recently, each capturing between 6 and 10 percent of the market. Argentina, in 1964, for the first time appeared among the top four suppliers on the basis of book and office machine sales. Table 14 shows imports of miscellaneous manufactured prod- ucts, by commodity groups and principal commodities, total and from the United States, in 1964. Stones, Earths, Ceramics Prepared Stones and Earths. Chile's require- ments for prepared stones and earths are met large- ly from domestic production. Imports, which have reached $3 million (1963) in recent years, consist primarily of asbestos. Limited quantities of cement materials are imported through free ports and spe- cial cements are imported elsewhere. Some vitreous enameling compositions are imported. Through its sales of asbestos, Canada has been the leading supplier while the United States has furnished most of the cement. Ceramics, Glassware, and Manufactured Stones and Earths. Imports of ceramics, glassware, and manufactured stones and earths ($6.4 million in 1964) consist almost entirely of refractory bricks to supplement Chilean production. Large quantities of refractory bricks are used in steel and copper smelting. The United States has enjoyed an increasingly large share of the market (57.2 percent in 1964). Germany has ordinarily supplied 20 to 25 percent of the market for ceramics and glassware through sales of a variety of products. Chilean industry produces most glass products except laboratory ware, optical glass, and watch crystals. Local factories now supply all requirements of the beverage, pharmaceutical, toiletry, household, kitchen- ware, and foodstuffs industries. Window and plate glass for the building trade are also produced, as is an increasing amount of glass for use in automobiles. Manufacturing techniques vary from the highly mech- anized production of flat glass and containers to semi- automatic and manual production of household and other glass products. The high cost of glass con- tainers substantially increases the sale price of the end product, with the result that heavy plastic bags are often used in their place. Sanitary fixtures; tableware; utility pottery, pipes or tubes made of earthenware, stoneware, cement or asbestos; and other ceramic, stone, and earthenware products used in Chile are produced mainly by the local industry. Small amounts of glass and consumer products enter through the free ports. 62 Table 14. — Imports of Miscellaneous Manufactured Products, by Commodity Groups and Principal Commodities, Total and From the United States, 1964 [Thousands of dollars] [Thousands of dollars] Tariff number Description Imports United Total States Tariff number Description Imports United Total States Group 67 Prepared stones and earths 2,813 1494-001 Vitreous compositions for fire enameling or coloring glass 229 1495-001 Asbestos boards or sheets 174 1497-001 Asbestos, fibrous state 1,340 1498-001 Asbestos, worked into any shape, for the manufacture of engine packings 222 1499-001 Portland cement, or other cal- cined silicates of lime and alu- mina other than white cement.. 269 -003 Thermolith 54 -004 Klinkers for white cement 46 1500-001 Eternit 55 -005 Cements, n.e.s 375 Group 68 Ceramics, glassware and manufac- tured stones and earth 6,438 1515-021 Glass wool, conglomerated 76 1517-012 Earthenware, painted or decorated 123 1523-001 Fine porcelain, gilt 30 1533-021 Piping, channeling, etc., n.e.s., of asbestos and magnesia, mixed, for thermic insulation 102 1543-011 Bottles, flasks, and other glass re- ceptacles, weighing 10 to 50 grams 86 1548-006 Lavatories 31 1556-001 Figures, statues, vases and other ornamental articles 64 1562-001 Refractory brick 4,922 1574-001 Sandpaper, not including emery paper 82 1582-001 Glass tubing and pipe, for any purpose 82 -004 Glass tubes, neutral, calibrated .... 47 1585-001 Glass for spectacles 31 1586-001 Glass pieces, unworked, for lenses 51 1587-001 Common flat glass, more than 4 millimeters thick 60 1594-001 Glass wares, unetched, with a density below 2.6, n.e.s 134 Group 69 Manufactures of wood 228 1604-004 Pine lumber, planed or dove- tailed, for construction 59 1606-001 Laths, planed, for partitions 32 1608-006 Plywood 28 1609-001 Sheets or bars of wood-fiber to -003 pulp 82 Group 70 Cabinet-maker's wares and other wares of wood or compressed sawdust 337 1615-002 Tanks or receptacles, of all kinds, other than barrels or casks 43 1633-001 Furniture 184 Group 71 Manufactured cork and cork wares.. 20 Group 72 Manufactures of rubber, plastic and similar material 2,653 1643-002 Automatic pencils and pens, of of bakelite 59 -003 Manufactures of bakelite, n.e.s., other than buttons 115 -022 Manufactures of compositions similar to bakelite and celluloid 475 -041 Razors of bakelite or similar ma- terial, for shaving 37 1644-010 Miscellaneous rubber articles (pri- to -021 marily for personal use) 48 1645-001 Tubes or hose-piping, their con- nections and branchings 1,385 952 144 57 167 Group 72 1646-001 1650-001 1652-001 87 Group 73 28 46 1660-001 i 41 1662-001 369 1663-001 3,684 25 11 3 1664-001 1666-001 1667-001 49 Group 74 3 10 Group 75 1697-001 7 3,303 1700-001 1701-002 29 16 i 14 44 49 94 59 2 24 175 43 98 5 989 57 19 145 3 24 570 1702-001 -002 1704-003 -011 1715-011 -021 1717-001 1718-001 1721-001 1723-001 1724-002 1726-001 -004 1727-001 -002 -003 1729-002 1730-003 1734-011 1735-002 1739-016 -continued Sheets and strips of rubber and similar resins 134 Elastic thread, not exceeding 15 grams per 10 meters 29 Footwear, rubber, n.e.s 47 Tannery products, furs, and their derivatives 835 Footwear with leather uppers or soles: Top boots, with legs 25 to 45 centimeters high 19 Boots, with legs up to 16 centi- meters high 21 Boots, with legs 16 to 22 centi- meters high 75 Boots, with legs exceeding 22 centimeters high 607 Footwear, n.e.s., 16 to 22 centi- meters long, without silk 44 Footwear, n.e.s., over 22 centi- meters long, without silk 27 Manufactures of horn, bone, and other animal materials, and similar materials 7 Paper and paperboard 4,132 Paper and paperboard wares, not specified 94 Paper bags and sacks, n.e.s 82 Paper bags and sacks, with fabric 289 Empty boxes, of paperboard or cellulose 24 Valises and trunks, of paperboard or cellulose 55 Paperboard or corrugated paper prepared with pitch 34 Paperboard of vegetable fibers, impregnated with pitch 35 Paper, for newspapers, periodicals, books, etc. 845 Paper, for covers of periodicals... 192 Paper weighing less than 150 grams per square meter (exclud- ing wrapping paper) : White or slightly tinted, with animal sizing 303 "Couche" (coated on both sides with mineral substances) 128 Cigarette paper, on reels 186 Sensitized paper for reproduc- ing plans 136 Sensitized photographic paper .. 371 Paper, with a layer of wax, for use by reproduction machines 34 Paper, with a layer of material other than fabric, for use by reproduction machines 18 Carbon paper 34 Cellophane 28 Gummed paper in rolls 96 Paper, cut in special shapes .... 45 Paper, weighing less than 22 grams per square meter 49 Paper and paste, for filtration or putting up goods 68 Paper, for registering apparatus 80 Paper, weighing 22 to 150 grams per square meter, other than rag, gum or wrapping paper 90 58 188 9 738 19 20 72 549 43 24 i 1,107 77 68 3 15 i 33 67 15 55 29 129 116 26 18 23 17 29 33 27 59 34 63 Table 14. — Imports of Miscellaneous Manufactured Products, by Commodity Groups and Principal Commodities, Total and From tbe United States, 1964 — continued. [Thousands of dollars] [Thousands of dollars] Tariff number Description Imports United Total States Group 75 — continued -023 Paper, weighing more than 150 grams per square meter, other than bookbinding or wrapping paper 194 -031 Paper for manufacturing machine tabulating cards 242 Group 76 Printed matter and engravings on paper or paperboard 5,073 1747-001 Commercial advertising matter, to -003 n.e.s 33 1751-001 Decals, in any form 34 1757-001 Commercial catalogues 73 -003 Printed or manuscript books 4,144 -004 Printed or manuscript magazines.. 630 -005 Publications, printed or manu- script, n.e.s., other than news- papers 35 1760-001 Writing paper and envelopes with monograms, initials, letterheads, etc 20 Group 77 Arms and ammunition 544 1763-006 Rifles, other than carbines 301 1772-001 Cartridges and cartridge cases, metal, filled 159 1773-001 Primers 36 Group 78 Jewelry, gold- or silversmith's wares, clock- and watch-makers' wares 537 1779-001 Movements and other parts for watches, n.e.s., other than cases not of precious metal 37 1791-002 Wrist watches, in ordinary metal cases, whether or not plated or inlaid with precious metals 331 1792-002 Alarm clocks, musical or not 73 Group 79 Articles and instruments for the sci- ences, fine arts, and applica- tions thereof 12,186 1801-001 Spectacles, with frames 46 1804-001 Prismatic binoculars 53 1805-001 Protective glasses and goggles 70 1808-013 X-ray producing apparatus 838 -014 Spare parts for X-ray apparatus and other current producing ap- paratus in No. 1808 68 1810-001 Scales, automatic, n.e.s., with a capacity exceeding 50 kilograms 90 -002 Weighing machines, automatic, n.e.s., with a capacity exceeding 50 kilograms 178 -003 Dynamometers, automatic, n.e.s., with a capacity exceeding 50 kilograms 72 -004 Steelyards, automatic, n.e.s., with a capacity exceeding 50 kilo- grams 35 18] 4-001 Precision scales, characterized by a graduated chart 46 1815-001 Scales, n.e.s., other than nonauto- matic 32 1816-001 Riographs, cinematographs, and similar apparatus 152 1817-001 Calipers, for measuring diameters or thicknesses 66 1822-001 Artificial acrylic teeth 18 1823-001 Loudspeakers 45 -003 Electric phonographs and radio- phonographs 196 -005 Record turntables and changers.. 39 -006 Radio receivers 552 17 Tariff number Description Imports United Total States Group 79- -007 -008 83 22 -009 1,306 -011 -012 17 4 1824-001 27 1.060 129 1826-001 -002 4 1827-001 15 1828-001 17 3 132 1847-001 1854-001 1855-003 17 1856-002 i -005 -006 -007 1 1 -008 1857-001 to -019 4,960 17 -020 1858-001 12 -002 59 210 -003 29 1861-001 59 -Oil 72 1863-002 -003 -004 7 1867-001 12 -002 -003 6 -006 -007 85 -008 34 18 1868-001 13 12 Group 80 30 Group 81 55 1885-001 -continued Telephone receivers and trans- mitters 531 313 Apparatus similar to electric phonographs, radios, turntables, etc., other than mechanical phonographs, n.e.s 97 50 Parts for receiving apparatus, etc. 1,042 333 Television sets 149 74 Recorders, other than dictation machines 91 33 Exposed movie film, positive or negative, including new or used movie film, other than educa- tional films 403 233 Assay and cupelling ovens 32 18 Utensils, n.e.s., for assaying and cupelling 505 364 Scientific hand instruments for professionals, including parts .. 305 71 Machines and apparatus for pure and applied science, n.e.s., other than escaped gas detectors, and electromedical apparatus 894 380 Accordions 60 1 Hypodermic syringes 70 13 Photographic cameras, not movie or aerial 40 8 Calculating machines and ap- paratus 1,094 769 Spare parts for adding, calculat- ing and similar machines 297 185 Adding machines, electrical 385 29 Adding machines, manual 156 Statistical and similar machines, with calculating functions 189 Typewriters 666 95 Spare parts for typewriters 294 110 Manuscript-reproducing machines 89 56 Similar manuscript -reproducing apparatus, including addressing machines, other than portable mimeographs 43 28 Spare parts for manuscript-repro- ducing machines 40 23 Educational materials, other than furniture, imported on behalf of educational establishments, even if specified under another tariff number 31 8 Educational apparatus, accessories and instruments, n.e.s 53 13 Photographic film, unexposed 605 304 Radiographic plates 37 29 Photographic film, exposed, but not printed 159 46 Barometers 35 8 Hygrometers 39 6 Manometers 145 106 Thermometers, for any use 171 84 Meterological apparatus, n.e.s., other than rain gages 440 217 Spare parts for meteorological ap- paratus 36 30 Prepared moulding compositions for dentists 42 17 Works and objects of pure art 20 3 Various manufactures and products.. 9,075 2,648 Vacuum bottles and parts 48 7 64 Table 14. — Imports of Miscellaneous Manufactured Products, by Commodity Groups and Principal Commodities, Total and From the United States, 1964 — continued. Tariff number Group 81- 1886-003 1887-001 1899-001 -Oil -021 1903-001 1904-001 1915-001 1916-001 Description Imports United Total States -continued Orthopedic apparatus, n.e.s., other than trusses or fracture splints.. 33 31 Educational equipment sets for pure and applied science, in- cluding microscopes 237 27 Material imported for use of the Chilean state 1,843 38 Military equipment and articles for making uniforms 3,087 1,159 Spare parts, accessories, etc., n.e.s., imported by the Chilean Na- tional Airline 170 149 Travelers' baggage 399 167 Carpet sweepers, mechanical 40 16 Toys, of plastic and similar ma- terials 56 4 Toys, mechanical 77 4 Tariff number Description Imports United Total States Croup 81 — continued 1917-001 Toys, n.e.s., other than games, or of marble 116 10 1936-001 Refrigerators, up to 10 cubic feet capacity 67 29 -002 Refrigerators, more than 10 cubic feet capacity 107 85 1943-001 Fishing tackle (primarily com- mercial) 2,478 786 All commodity groups, total 44,898 16,690 Listed principal commodities, total 42,559 15,523 Principal commodities as percent of total all commodity groups 94.8 93.0 1 Equals zero or less than $1,000. Source: Camara de Comercio, Comercio Exterior, Chile, 196i, Santiago, 1965. Note: Principal commodities include all items for which total imports exceed $30,000, or imports from the United States exceed $15,000. Wood, Cork, Rubber, Plastic Wood Manufactures and Cabinetmaker's Wares of Wood or Sawdust. The group, wood manufactures, and in the group, cabinetmaker's wares of wood or sawdust, totaled only $565,000 in 1964. Chile's important lumber industry supplies the nation's requirements and has been increasing its exports of sawn lumber. Domestic woods are used by the furni- ture industry, which supplies domestic needs, and by plants that turn out plywood, veneer, cooperage, shingles, millwork, and other wood products. About 250 plants manufacture wood products, other than veneer, of which about 220 reportedly do millwork. Some are run in conjunction with sawmills, but the majority are separate lumberyard operations turning out standard planning mill products, such as strip flooring, window sashes and frames, interior finish and trim, moldings, and exterior sidings and finish. Only a handful of firms produce plywood, veneer, hardboard, insulated wallboard, and shipboard. Most imports of wood products are into the free ports. Cork Manufactures and Their Wares. Imports of cork manufactures and their wares totaled $20,000 in 1964 and consisted almost entirely of stoppers that came from Spain. Manufactures of Rubber, Plastic and Simi- lar Materials. More than one-half of the value of total imports in this group was produced by sales of tubing and hose-piping. Manufactures of plastic materials accounted for perhaps one-fifth of the $2.7 million total. Sales by the leading supplier, the United States, averaged $1.0 million during 1962-64. The Chilean rubber manufacturing industry meets most of the country's needs of industrial rubber prod- ucts, such as sheeting, rings, bands, hose and tubing, rubberized fabric, foam rubber, and elastic webbing; rainwear; soles and heels and footwear; druggists' sundries; and latex-dipped goods. 16 The Chilean plastics manufacturing industry has made great strides in recent years and should progress even more rapidly because of the stimulus provided by the expected expansion of plastic raw material pro- duction (described under the section dealing with chemicals) . The bulk of production is accounted for by a few firms, but there are many others which per- form small injection-molding operations. The industry produces a wide variety of plastic products, such as toys, radio cabinets, telephone shells, safety helmets, wiring devices, insulating materials, watermeter parts, brake linings, bottle and tube tops, artificial flowers, buttons, garden hoses, combs, and other household wares. Most of the imported plastic products, particu- larly those for personal use, such as mechanical pens and pencils, enter into the free ports. Tannery Products, Furs, Bone Tannery Products, Furs, and Their Deriva- tives. Imports in this group totaled $835,000 in 1964, almost all of which were boots, primarily high boots. The United States supplied nearly all of such imports. The hide and shoe industry are two of Chile's oldest industries. Sixty-five tanneries were in operation in 1963, with 30 of these accounting for most of the pro- duction. Three firms process chinchilla, silver fox, and seal. The industry has modernized its equipment but is facing increased competition from plastics and other substitutes. One factory processes waste leather and soles. Perhaps 80 percent of Chilean leather production 10 Imports of tires are dealt with under Automotive Equipment. 65 is used by some 75 relatively large or medium- sized factories and some 500 small shoe-repair shops which manufacture in excess of 16 million pairs of all types of footwear annually (this at 70 percent capacity). Quality standards are excellent, and Chile has had considerable success in marketing its shoes abroad. Manufactures of Bone, Horn, or Other Ani- mal Materials, Not Elsewhere Mentioned. Imports of the manufactures in this group, manufactures of bone, horn, or other animal materials, not elsewhere mentioned, are negligible. Paper, Printed Matter Paper and Paperboard. Imports of products in this group, paper and paperboard, have ordinarily to- taled between $3 — $5 million dollars during recent years, with the United States supplying about 25 to 30 percent of the market. Sales by Finland ordinarily approach in value those by the United States; the U.S. sales totaled $1.1 million in 1964. Since Chile is self- sufficient in the principal paper products, and is rapidly increasing its exports to LAFTA markets, im- ports consist almost entirely of a wide variety of fine and specialized paper products. Chile has experienced rapid growth in its paper and paperboard industry, spurred by an equally great in- crease in Chilean pulp production. Production in- cludes wrapping paper, machine glazed and standard papers, newsprint, Kraft paper (including machine glazed and finished), cement bags, small bags, cor- rugated cardboard, printing paper, toilet paper, towels, and wallpaper. Chile shortly expects to supply tabula- ting card stock for both domestic and LAFTA con- sumption. Printed Matter and Engravings on Paper or Paperboard. Printed books and magazines are the principal imports in this group with books representing 81.5 percent of the total in 1964 ($5.1 million). The favorable customs treatment accorded books and maga- zines because of their educational, scientific, or cultural value has supported a general rise in the level of such imports. In recent years, the customs authorities have been more strict in application of the above standard in the allocation of scarce foreign exchange. Argentina is ordinarily the principal supplier of imports, usually accounting for one-third of the total. The U.S. posi- tion in this market has improved recently, largely on the strength of technical publications. It averaged one- fourth of total sales in 1963-64. During the same time, Spain averaged one-fifth of the market. Mexico also supplies a substantial quantity of such imports. Other Items Arms and Ammunition. Imports of the items in this group are very limited — mostly rifles and car- tridges—and totaled $544,000 in 1964. Italy was the principal supplier then, with $291,000, followed by the United States with $156,000. Belgium, West Ger- many, Sweden, Switzerland, and the United Kingdom have been significant suppliers from time to time. A special prior import authorization is required for the importation of firearms, munitions, or explosives into Chile. Jewelry, Gold- or Silversmith's Wares, and Timekeeping Wares. Imports in this group have dwindled because of severe restrictions on the im- portation of items classified as luxury goods and totaled only $537,000 in 1964. Watches, watch move- ments, and alarm clocks accounted for more than four-fifths of such imports, most of which entered through the free ports. Switzerland and West Ger- many have been the principal suppliers of such products. The United States has not been a significant supplier in recent years. Articles and Instruments for the Sciences and Fine Arts, and Their Applications. This group continues to be the largest in the miscellaneous manu- factures category, representing slightly over 27 percent of such imports in both 1963 and 1964. However, the $12.2 million total for this group in 1964 represents a decline from 1961 when it reached $19.2 million and accounted annually for between 35 and 41 percent (1957-62) of the value of miscellaneous manufactured imports. The group is a diverse one, as is indicated by a listing of its major components: X-ray apparatus; weighing devices; radio receivers, telephone receivers and transmitters, and their parts; assaying and cupel- ling apparatus; scientific hand instruments; calculat- ing and other statistical machines; typewriters; photo- graphic film; and meteorological apparatus. The decline in the U.S. share of this market has been arrested, and it showed some improvement in 1964, reaching 40.6 percent ( $5.0 million ) . Substan- tial sales were made in all the above categories ex- cept scales and weighing machines and typewriters. West Germany, which had held the first position as late as 1962, slipped to second with 28.1 percent of the market in 1964, with sales heaviest for X-ray apparatus, phonographs, radio receivers and their parts, scientific apparatus, and meteorological ap- paratus. Argentina and Brazil have supplied more and more office machines in recent years. Only a very small volume of professional and scientific instruments is manufactured in Chile. Sur- gical instruments for doctors and dentists and sci- entific and processing equipment are imported on account by importers for wholesale or retail. Equip- ment with a more limited market, such as X-ray ap- paratus, microscopes, and advanced laboratory equip- ment are ordered by purchasers through representa- tives or agents in Chile. The Government's growing attention to improving public health facilities should 66 lead to larger equipment purchases by Government hospitals and institutions. Local manufacturers do not now supply office ma- chines. Some typewriters have been assembled in Chile, but demand has not supported operation of an assem- bly line except on an intermittent basis. However, Rem- ington Rand Chile, Ltda., announced plans in late 1965 for producing typewriters on a regular basis with a view toward exporting to LAFTA. The first stage would involve 100 percent assembly of imported parts. But eventually, 60 percent of the finished prod- uct would be of domestic components. Chile manufactures a substantial quantity of radio receivers, phonographs, and radio parts, such as transformers, resistors, rectifiers, tubes, chassis, loud- speakers, and cabinets. Some eight firms produce most of these, but a considerable number of smaller firms also do some assembly. Television sets are as- sembled in Chile, employing some domestically pro- duced electron tubes, transformers, and resistance bridges. Until recently, assembly was carried out for the most part in Arica because of customs advant- ages. Concerned with high prices for such sets, the Government placed them under price controls, and recently authorized two firms to assemble sets in Santiago. While there is as yet no commercial televi- sion in Chile, two universities carry out limited broad- cast operations. The Radio Broadcasting Association of Chile (ARCHI) recently obtained a concession from the Chilean Government to establish a commercial corpo- ration, the Compania Nacional de Radio y Television, S.A. This company imports the equipment and parts required by the some 50 radio broadcasting members of ARCHI, and will be in a position to provide tele- vision equipment if, and when, commercial television is permitted in Chile. Chile is almost entirely dependent on imports for its photographic equipment and supplies. Some cameras and accessories, although prohibited imports, enter through the free ports, and a small number of box cameras are produced locally. The use of color film has grown in popularity, despite high cost for film and processing, and there are some six labora- tories which handle color film. Works and Objects of Pure Art. Imports in this group are negligible, totaling only $20,000 in 1964. Various Manufactures and Products. This group, which once represented less than 10 percent of miscellaneous manufactured imports, in 1964 ac- counted for 20.2 percent of such imports. A great deal of the rise can be attributed to sales of commercial fishing gear for the northern fishmeal operations. The shortage of fish during the 1964 and 1965 seasons produced a movement toward consolidation of the northern fishmeal industry and generated interest in exploitation of the food-fish resources of central and southern Chile. Purchases by the Chilean military are ordinarily made by public bid. Toys still enter through the free ports, as do small refrigerators. Large refrigerators, which are not produced in Chile, are permitted entry. 67 sa^ ^*p% CHAPTER IV Distribution MARKETING CHANNELS Santiago is the principal distribution center for Chile. Perhaps some 2.4 million of Chile's estimated 8.9 million inhabitants live in Greater Santiago, and almost three-fifths of the population live within a hundred-mile radius of the capital. By far the great- est number of import houses, distributors, and agencies have their headquarters in Santiago, al- though some serve the Santiago trading area from offices in the port city of Valparaiso, 50 miles away. CORFO, in early 1966, completed a study of a pro- jected industrial park in Valparaiso; the park may eventually make establishment of representation there even more attractive. The trade territory of Santiago extends from a little north of Valparaiso to Curico in the south. The territory roughly encompasses the Provinces of Santiago, O'Higgins, Colchagua, and the northern part of Curico. Many of the import outlets situated in Santiago provide nationwide distribution through branch offices in other cities, or through traveling salesmen who canvass the entire country. Representatives for many exporters who wish to sell in southern Chile, locate in Concepcion. It is situated in one of the areas with the greatest in- dustrial growth potential in Chile. It will be the site of an important component of Chile's projected petrochemical industry. Chile's steel mill is already located there, providing a stimulus to metal-working industries. Electric power capacity is being greatly increased to supplement existing coal resources in the area. Talcahuano is the port for Concepcion, but con- struction will begin shortly on new port facilities on nearby San Vicente Bay. Some independent outlets are established in the remote free port city of the far south, Punta Arenas, which serves the wool and petroleum area of Chile. Antofagasta has been selected by some to provide sales coverage of northern Chile. Arica, because of its assembly industries and free-port status, has been the choice of others. In many cases, this is probably the only market of any significance for consumer goods. However, Arica's free-port privileges have been greatly curtailed in past years and are likely to be even further curbed. A brief description of the economy of these regions and their principal cities is contained in Appendix B. REPRESENTATION The four principal types of import representation preferred in Chile are import houses, commission agent, direct purchase, and subsidiary or branch. Whatever type of representation is decided upon, the exporter should, if possible, make a personal visit to Chile for the selection of a suitable agent and for firsthand observation of local conditions. Success in selling a product will very often depend on the ability of the exporter to make friends with his agents and clients and to understand and adjust to conditions A CHILEAN GARY, INDIANA: Steel mill of Cia. de Aeero del Pacifico, Talcahuano, Chile. 69 STEEL MILL: Coke ovens of Cia. de Acero del Pacifico, Huaehipato, Chile. which may vary greatly from those with which the exporter is accustomed in the United States. This is so because the average Chilean businessman places a high value on good personal relations and because he often faces severe obstacles to doing business ranging from domestic credit restrictions to complicated and ever-changing import restrictions. The largest mining companies in Chile do almost all their purchasing through central procurement of- fices in New York. Frequently, import houses are large and well- financed concerns which import on their own account but will also agree to represent an exporter on a com- mission basis. Many of these firms have head offices in Santiago and maintain branch houses or agencies throughout the country. A number of the large firms represent foreign interests, including U.S., British, and German, but most are owned by Chilean nationals. This method of importing offers the exporter consider- able financial security because of the risks assumed by the import houses but suffers from the fact that many of the houses have far too many lines to carry out effective promotional activities for a particular prod- uct. The commission agent is the most common type of representation. Particular care should be taken to in- 70 sure that the agency selected has sufficient standing and financial ability to offer adequate representation. In many instances, agencies are far too busy to pro- mote a new product effectively. Frequently, the best type of representation, and the one generally pre- ferred, is the agent who specializes in a small group of similar but noncompetitive products. Because the agent is paid a commission of from 2.5 to 10 percent, depending upon the product line, the exporter may expect more aggressive representation and can main- tain control over his product. However, his financial risk is greater than with other forms of representation since there are few agents willing to assume financial risk. The large mining companies, agricultural estates, state enterprises, commercial airlines, public utilities, and government agencies frequently import their own machinery and supplies. They buy direct. The largest private importers are the large copper and iron ore mines. The establishment of a local subsidiary or branch gives the greatest guarantee that the exporter will ob- tain efficient and aggressive promotion of his product. But this method involves a considerable investment and can only be justified when sales are made in volume or when local servicing facilities and inven- tories are required. GOVERNMENT PURCHASING Government entities, more often than not, do their own procurement. Chilean law calls for public bids for such purchases, although procurement by negotia- tion is permitted in certain cases. Chilean Govern- ment agencies with offices in the United States include: Chilean Development Corporation (Corpora- cion de Fomento de la Produccion ) . Investment, trade promotion, financing and purchasing of capital equip- ment for industrial and agricultural development projects. 80 Pine Street, New York, N.Y., 10005. National Petroleum Enterprise (Empresa Na- cional del Petroleo). Engineering and purchasing. 80 Pine Street, New York, NY. 10005. National Electric Power Enterprise (Empresa Nacional de Electricidad) . Engineering and purchas- ing. 80 Pine Street, New York, NY., 10005. Chilean State Railways ( Empresa de los Ferrocar- riles del Estado). Financing and purchasing of rail equipment. 80 Pine Street, New York, N.Y., 10005. Chilean National Airlines (Linea Aerea Nacion- al). 500 Fifth Avenue, New York, NY., 10005. Chilean Nitrate Sales Corporation, Chilean Iodine Bureau. 120 Broadway, New York, NY., 10005. Chilean Military Mission. 1736 Massachusetts Avenue, NW., Washington, D.C., 20036. Chilean agencies which make direct purchases and also have offices in Santiago, include: Ministry of Public Works (Ministerio de Obras Publicas) Ministry of Defense (Ministerio de Defensa) Chilean State Urban Transport System (Empresa de Transportes Colectivos del Estado) State Maritime Company (Empresa Maritima del Estado) National Mining Enterprise (Empresa Nacional de Miner ia) Purchases for small mines. Agricultural Commerce Enterprise ( Empresa de Comercio Agricola) Monopoly importer of many agricultural products. Chilean Port Authority (Empresa Portuaria de Chile) State Telegraph Service (Telegrafos del Estado) This list is not exhaustive, and other agencies im- port from time to time. SELLING THE TRADE Credit Information and Advertising Credit information is readily available in Chile. The sources for such information are described in Chapter V: Marketing Aids. Advertising methods used in Chile are similar to those in the United States. However, advertising is not as widespread in Chile, and the approach is somewhat more restrained with emphasis upon the practical advantages of the product. In 1964, the press account- ed for 51 percent of all advertising expenditures, radio for 35 percent, outdoor display for 9 percent, movies for 4 percent, and television for 1 percent, according to the International Advertising Associa- tion. 17 There is no commercial television in Chile, and advertising in that medium has been on a limited experimental basis only. There are some 30 advertising agencies in Chile. Almost all of them are located in Santiago from where they provide coverage for the entire country. Most are small, except two or three Chilean firms and four foreign firms. The latter includes the subsidiaries of three U.S. firms: Grant Advertising (Chile), Ltda.; J. Walter Thompson Chilena, SAC; and McCann- Erickson Corp. y Cia., Ltda. These "foreign" firms are generally staffed entirely by Chilean nationals, in- cluding top management, receive no financial help, and remit no profits to their parent operations. The foreign firms and one or two of the larger local firms handle most of the international accounts. They are fully equipped to do translation and original work for their clients. They write texts for advertising, pre- pare visual copy, plan advertising films, prepare recordings, plan sales promotion campaigns, design containers, decorate offices and stores, and place bill- board advertising. Some of the agencies carry out spot checks of radio and press advertising throughout the country. The larger firms use direct-mail lists, while others use city directories. There is an advantage in dealing with one of these international agencies since they charge international rates. If one excludes special items, such as artwork, printing costs, and actors' fees, the cost of placing advertising is very low, since the larger agencies draw much of their income from a 15-percent com- mission obtained from the medium which carries the advertising. Smaller agencies, however, usually charge an additional fee. Newspapers are among Chile's most important ad- vertising media. Chile's free press is very influential. Its influence is partly the result of Chile's having one of the highest literacy rates in Latin America. There are more than 34 newspapers in Chile, 10 of them in Santiago. Many of them reflect the viewpoints of various political groups. Several of the Santiago pa- pers such as EI Mercurio. La Nacion and El Diario Illustrado have a wide distribution in Santiago and throughout the country. El Mercurio has the largest circulation, followed by La Nacion, which is supported by the Government. Newspapers in Valparaiso, Con- cepcion, Antofagasta. and other cities also have large circulations. A number of magazines enjoy mass circulation. Among the most popular are Vea, Ercilla and 7 Dias- Zig Zag. Reader's Digest and Life are circulated in 17 The Gallatin Statistical Annual 1966, Copley International Cor- poration, 1966. 71 Spanish, and a Latin American English edition of Time is also popular. The Spanish edition of Vision is published in Mexico and has become increasingly popular. There are relatively few trade journals. They in- clude: Industrie/,, published monthly by the Sociedad de Fomento Fabril (an organization similar to the National Association of Manufacturers) ; Construction, published monthly by the construction industry's association; Panorama Economica, a privately pub- lished monthly dealing with economic and commercial problems; and El Campesino, a monthly published by the National Agricultural Society. There are about 100 AM and FM broadcasting stations in Chile, some 30 of which are in Santiago. All stations are commercial, with the exception of four belonging to educational institutions and one partially owned by the state in Arica. Most stations are on the air from about 7 a.m. till midnight. There are a few 24-hour stations. All stations broadcast a great variety of programs, with a strong emphasis on popular music and news at most stations. FM stations carry fewer commercials than AM and often feature semi-popular and classical music. There are between 1 million and 1.5 million radio sets in use in Chile. There are two television channels in Santiago and one in Valparaiso. Each is operated by one of Chile's leading universities. A national debate has been going on for some time over the question of whether to permit commercial television. Transmission hours are restricted for the most part to evening hours, termin- ating at about 11 p.m. Programs include a variety of subjects directed mostly to adult viewers, but there are some children's shows. The U.S. television shows with dubbed Spanish voices are popular. Advertising has been on an experimental basis, with the restriction that advertising is permitted only at the beginning or end of a program. Since most of the U.S. shows originally had inserted advertisements, there is more time between regular programs than in the United States. Television sets are very expensive in Chile. There are probably somewhat less than 50,000 in operation throughout the country. The Government has been experimenting with their use in education and community development work. Advertising in Chile's motion-picture theaters, of which there are more than 350, is both effective and economical. Other forms of advertising include bill- boards, direct mail, posters in public transportation, and neon siims. Market Research Marketing research is relatively new in Chile, but there is a growing appreciation of the value of pre- liminary surveys offered by market research organi- zations. Local companies are beginning to use such services, but most of the companies probably continue to form their plans on the basis of past sales experi- ence and on their agent's estimates of the market. Until recently, the large U.S. advertising agencies had dominated the market-research field. A handful of local and foreign specialized firms has now entered the field, and one of the U.S. advertising agencies has established a separate market research organization. Practices Most sales involve credits timed to mature at the end of the minimum legal waiting period for payment. The official delay is now ls 80 days from the date of shipment. Most escudo payments, including those financed by AID program-loan funds, are effected within a month after the end of that period. Some payments are made by confirmed letters of credit, but the Government has severely limited the volume of these letters. Under a special program for the financ- ing of high-priority capital goods imports, an increas- ing volume of AID-financed imports will go under confirmed letters of credit. Chile's improving foreign exchange position is expected to result in the continued further reduction of payments delays. Once the backlog of payments is cleared up, however, the scarcity of local credit and the competitive nature of the market will probably lead many established importers of good standing to ask for terms of 60 to 180 days sight, documents against acceptance. Following debt renegotiations with its creditors in January 1965, the Central Bank initiated new efforts to clear up commercial arrearages and limit increases in short- and medium-term credits. Consequently, Chilean importers are now asking suppliers for 8-year terms on goods formerly sold on three to 5-year credits. In quoting prices, Chilean importers generally pre- fer c.i.f. quotations. This permits them to calculate more readily the total cost of the merchandise at the Chilean port, particularly since many customs charges are in terms of the c.i.f. value. While the United States still has probably the best reputation for quality, economy-minded Chileans, in- cluding the Government, may often pass over better quality U.S. products in favor of lower priced goods from other countries. Because such importers are frequently motivated by restricted budgets, tight do- mestic credit, and rationed foreign exchange, they are often unwilling to pay higher prices for specialized or high-volume types of machinery and equipment made principally for more industrialized countries. Price controls are maintained on an increasing number of commodities. Such articles are defined as items of prime necessity and consist almost entirely of 18 August, 1966. 72 CHILE'S PRINCIPAL CITY: Santiago is the headquarters for most of the major commercial, industrial, distributing, banking, and mining enterprises. products for mass consumption. These controls are part of the Government's program to bring inflation gradually under control. Agricultural prices are being permitted to rise more rapidly than prices for indus- trial goods as part of a policy to stimulate the lagging agricultural sector. Business correspondence, catalogs, price lists, and instructions for use or operations of products should be in Spanish. The U.S. firms are urged to give full particulars and detailed descriptions as soon as possible after opening negotiations with a prospective buyer. Cablegrams and other correspondence which must be sent in English should be clear and detailed, avoiding abbreviations and U.S. colloquialisms. American manu- facturers who contemplate entering the Chilean market should register their trade names and trademarks. Chile operates on the metric system of weights and measures. It is worthwhile for the U.S. supplier to give specifications in terms of the metric system, since almost all of his foreign competitors do so automati- cally. Information on shipping documents may be obtained from freight forwarders doing business with Chile, and from the Commerce and Industry Association of New York, New York. Inquiries may also be sent to the nearest Department of Commerce Field Office or to the American Republics Division, Bureau of International Commerce, U.S. Department of Commerce, Washing- ton, D.C., 20230. Particularly close attention should be given to AID documentation requirements since the Chilean Government requires that appropriate AID documentation be submitted for all shipments from the United States, whether or not they are known to be AID-financed. Improperly executed AID documenta- tion has been one of the principal causes in payments delays for shipments to Chile. Inquiries concerning 73 AID documentation requirements should be directed to the Office of Material Resources, Agency for Inter- national Development, U.S. Department of State, Washington, D.C., 20523. Warehousing facilities are found in the principal ports and other commercial centers. Both refrigerated and nonrefrigerated storage facilities exist in Valpar- aiso and in other ports of entry. In addition to pub- licly owned storage space, there are a number of privately owned warehouses. The Government regards fiscal warehouses as facilities for temporary storage, and storage charges are set on a progressively rising scale. Trade Associations The Central Chamber of Commerce of Chile — Camara Central de Comercio de Chile — is an associa- tion of chambers of commerce throughout Chile, with headquarters in Santiago. Those of Santiago, Valpar- aiso, and Concepcion are the largest, but most towns of any size also have one. The Central Chamber of Com- merce and Chamber of Commerce of Santiago are located at Ahumada 341. The Chamber of Commerce of the United States of America in the Republic of Chile is located at Bandera 84 in Santiago. Its mem- bers are U.S. businessmen and firms and Chilean firms CHILE'S PRINCIPAL PORT: Longshoremen at Valparaiso's waterfront prepare melon crates for shipment to the U.S. 74 which represent U.S. firms. Membership lists for this organization are available, and it publishes business in- quiries from the United States in its monthly news- letter. The National Association of Importers is orga- nized to promote the interests of importers and pub- lishes an informative newsletter. There is a similar organization of Chilean exporters. The Sociedad de Fomento Fabril — manufacturers association — at Monedas 759 can answer many ques- tions about Chilean industry, or can direct the in- quirer to one of its many member associations which represent specific industrial sectors. The Sociedad Nacional de Agricultura at Ponderini 187, Santiago, and the Sociedad Nacional de Mineria at Monedas 759, Santiago, may be helpful on questions relating to agriculture and mining. Transportation Ocean Shipping and Ports. Three principal trade routes connect the United States with Chile. The first extends from the United States Atlantic ports through the Panama Canal to the west coast of South America; the second connects United States Pacific ports with the west coast of South America: and the third joins United States Gulf ports (via the Panama Canal ) with Chile. Three conferences (shipping associations) regulate much of the scheduled trade between the United States and Chile. Their names are descriptive of the areas served: (1) Atlantic and Gulf-West Coast of South America Conference, (2) Latin America-Pacific Coast Steamship Conference ( north-bound and south- bound), and (3) West Coast of South America-North- bound Conference. Chile's two international shipping companies and the U.S. Gulf and South American Steamship Co., Inc. (Gulfsa) are modernizing their fleets. The first of the new fleet of five modern cargo vessels of Gulfsa arrived in Valparaiso June 3, 1964. These ships make the Val- paraiso-New Orleans run in approximately 15 days. Cia. Chilena de Navigacion Interoceanica has added two new vessels to its fleet, which serves South Ameri- can ports via the Straits of Magellan. Constructed in West Germany, they are modern cargo vessels with comfortable passenger accommodations. CSAV, which serves the west coast of South America and U.S. Gulf and Atlantic coasts, has announced the placing in service of the first of four new ships of 10.500 dead- weight tons each. These vessels, constructed in Japan, will each have 100,000 cubic feet of refrigerator ca- pacity. Three combination cargo-passenger ships and five freighters of the Grace Line alternate in providing weekly services between New York and the full range of Pacific Coast ports to Chile, with calls north and south bound at other U.S. Atlantic ports as cargo re- quirements dictate. There is Grace service approxi- mately once a month from U.S. Pacific coast ports to Chile, with calls at Mexican, West Coast of Central America, and other West Coast South America ports. Further information on the Chilean merchant marine is contained in Chapter III: Commodity Analysis, under Transport Machinery, Materials and Accessories. A National Port Authority, Empresa Portuaria de Chile, a semi-autonomous entity, was created by the Chilean Government in May 1960 and charged with the responsibility of operating the 10 ports handling 80 percent of the cargo moving in and out of Chile. These ports are, from north to south: Arica, Iquique, Antofagasta, Coquimbo, Valparaiso, San Antonio, Talcahuano, Valdivia, Puerto Montt, and Punta Arenas. The 50-odd other ports in Chile, except those which are privately owned, were left under the con- trol of the Ministry of Public Works. Of these, by far the greatest value and volume of imports enter through Valparaiso. Most of Chile's exports, predominantly minerals, move through Coquimbo and Chile's 16 im- portant private ports devoted to loading or discharging bulk cargoes. The private ports are generally efficient, with facilities such as belt-loaders or pumps for rapid transfer of cargo. Of those ports, Huasco, Tocopilla, and Chanaral move most of the cargo, which consists primarily of exports. Table 25, Appendix D shows the total value and weight of goods imported and exported through Chilean ports in 1964. Airlines. LAN provides both domestic and interna- tional service. LAN's domestic services radiate from Santiago northbound to such points as Antofagasta, Iquique. and Arica and southbound to Concepcion, Puerto Montt, and Punta Arenas. Its international services connect Chile with Argentina, Uruguay, Bo- livia, Peru, and the United States. LAN is a mem- ber of the International Air-Transport Association ( IATA ) . A smaller company, Linea Aerea Sud Americana, also provides domestic service. Foreign lines connecting Chile with other countries include Aerolinas Argentinas; Aerolinas Peruanas: Air France; Alitalia; Canadian Pacific Airlines Ltd. (CPA); Lineas Aereas Espanolas (Iberia): Lineas Aereas Suizas (Swissair): Lufthansa (German): Pan Air do Brasil: Pan American-Grace Airways ( Pan- agra ) : Real Aerovias Brasilia: Royal Dutch Airlines ( KLM ) ; and Scandinavian Airlines System (SAS). Currently, Chile's air transportation system operates in all major cities via 9 primary airports and 20 secondary fields, the majority of which are slated for improvement under the country's 10-year development plan. New airports are under construction at Con- cepcion and Santiago, the latter designed to accom- modate the largest jet aircraft. LAN inaugurated both national and international jet flights in 1964 with the purchase of three Caravelles. 75 ^|pNSe P4?s ***sS •#yi :*•*»". ■■■. -T *^SfWsy» / F T7f yjJ-^Mf ml Wi r? ^*~ ' ^ 4* * 76 I *%'%>. The international service includes Santiago-Miami (with stops at Lima and Panama City) and Santiago- Buenos Aires-Montevideo flights. Santiago and Arica are connected by six jet flights weekly. Railways. Chile's railroad system serves all of the important industrial mining and agricultural centers north of Puerto Montt. The railways, 80 percent of which are Government-owned, extend north to south from Zapiga, 192 miles south of Arica in the north, to Puerto Montt, or, a total distance of 1,960 miles. Branch lines provide service from east to west. Five of these lines provide international rail service to Bolivia and Argentina. There are several private lines which are fundamentally adjuncts of specific industries. Highways. The Pan-American Highway (com- monly known as the Longitudinal Highway) forms the backbone of Chile's road system. It is hard-surfaced and runs, with a few very short incomplete sections which should be completed in the near future, from the border north of Arica to Puerto Montt. The initiation of ferry service to the Isle of Chiloe in 1964 permits an extension to Queullin, its southern terminus. Trans- verse highways lead from it to the important seaports and industrial and agricultural areas. These, in turn, are crossed by feeder-type roads in many locations. The entire road system approximates 35,000 miles, about half of which is usable the year around, since little more than 3,000 miles of the system is all-weather surfaced. Considerable work remains to be done, par- ticularly on the transverse system of the south. Government Representation The Embassy of Chile is located at 1736 Massachu- setts Avenue, NW., Washington. D.C.. 20036. Chilean Consulates General in the United States are located at 61 Broadway, New York, New York, 10006; 427 West Fifth Street, Los Angeles, California; and 611 Gravier Street, New Orleans, Louisiana. Chilean consulates are located in Miami. Florida, and San Francisco, California. Honorary consuls are lo- cated in San Diego, California; Honolulu, Hawaii; Chicago, Illinois; Baltimore, Maryland; Boston, Massachusetts; Detroit, Michigan; White Bear Lake, Minnesota; Kansas City, Missouri; Ithaca, New York; Santurce, Puerto Rico; Dallas, Galveston, and Fort Worth, Texas; Seattle, Washington; and Milwaukee, Wisconsin. Information on official U.S. Government represen- tation in Chile is contained in Appendix A, Notes for Businessmen. MOUNTAIN RAILROAD: High in the Andes is one of Chile's mountain railroads. 77 CHAPTER V Marketing Aids The U.S. Department of Commerce in Washington, D.C., and its 42 Field Offices in principal cities throughout the United States provide a wide range of activities, services, publications, and information to assist the U.S. businessman operating overseas. Valu- able assistance is also available from other private and U.S. Government sources. DEPARTMENT OF COMMERCE Promotional Activities Trade Missions. The Department of Commerce organizes or provides assistance for trade and invest- ment missions to various countries, including Chile. Mission members meet with foreign business groups, private businessmen, and Government officials and present business proposals submitted by U.S. com- panies. United States firms may submit business pro- posals, usually up to 6 weeks before each mission's de- parture. The last official mission to visit Chile was in December 1961. Industry-Organized Government-Approved trade mis- sions (IOGA) usually concentrating on a much nar- rower range of products than the official mission — also receive the active support of the Department. Such missions usually survey the markets in more than one country within a region. Thus, an IOGA Poultry Industries Trade Mission visited Chile, Argentina, Brazil, and Peru during March 1966. For information on these activities, write to the nearest U.S. Department of Commerce Field Office or to the Department's Trade Missions Division, Bureau of International Com- merce, Washington, D.C., 20230. Trade Fairs. The Department organizes and par- ticipates in international trade fairs in foreign coun- tries. It may either itself sponsor a solo exhibit or participate in one organized by the host country itself. The latter type fair could be the combined International Industrial and Agricultural Exposition, which is held annually near Los Cerrillos, Santiago's International Airport. Mobile Trade Fairs, Inc. exhibits U.S. products by means of completely integrated containerized displays, which may be shipped by sea to one or more foreign countries. The display is exhibited in the port of arrival or may be easily shipped inland for display elsewhere. Such an exhibit was held in Vina del Mar (near the port of Valparaiso) and in Santiago in February 1966. Inquiries concerning trade fair activi- ties should be directed to the nearest U.S. Department of Commerce Field Office or the Department's Com- mercial Exhibits Division, Bureau of International Commerce, Washington, D.C., 20230. Sales Literature Displays. The commercial li- brary of the American Embassy in Santiago has limited facilities for display of sample brochures but CONCRETE DAM: Rapel hydroelectric plant clam wil serve the main industrial centers of Santiago and Valparaiso upon completion. 79 maintains a file of such material for use by Chilean businessmen who call or visit the library. For infor- mation on this service, write to the Department's Office of International Trade Promotion, Bureau of Inter- national Commerce, Washington, D.C., 20230, or con- tact one of the Department of Commerce Field Offices. Direct Trade Aids Inquiries concerning trade services are welcomed by the U.S. Department of Commerce field offices and by the Commercial Intelligence Division, Bureau of International Commerce, U.S. Department of Com- merce, Washington, D.C., 20230. They can help an ex- porter get started in Chile or provide the existing exporting firm with the following services: Trade Lists. Trade lists are available to U.S. firms wishing to find customers, agents, distributors, licensees, and sources of supply in Chile. Each list gives names and addresses of firms handling a specific commodity. The list also contains a summary of basic trade and industry data, including a brief analysis of foreign trade in the commodity covered, Government regulations affecting trade in the product, and other useful information. Lists of Chilean importers and dealers indicate relative size of each firm, method of operation, products handled, territory covered, and size of the sales force. Lists of Chilean exporters and manufacturers show relative size or production capac- ity of each firm and the products handled. Price: $1 for each commodity classification. World Trade Directory Reports. World Trade Directory Reports carry basic commercial and financial information on specific Chilean firms and individuals. Data furnished on a given firm usually cover the type of organization, method of operation, lines handled, size of firm, sales territory, names of owners and officers, capital, sales volume, general reputation in trade and financial circles, and names of any U.S. firms represented by the foreign firm and serving as its supplier. They are prepared by the U.S. Foreign Service, and represent a consensus of reliable sources of information. They cost $2 per report. If information on a particular Chilean firm is not on file in Washing- ton, D.C., it will be requested from the Foreign Service. To minimize delay, businessmen may author- ize telegraphic request and reply, for which the U.S. Department of State will bill them directly. Trade Contact Surveys. Trade contact surveys are specifically designed to locate agents, distributors, or licensees in Chile. They are made by the U.S. Foreign Service and are tailored to locating several firms which meet the specific requirements of the U.S. businessman as outlined in a business proposal. A sur- vey is usually completed in 60 days, and includes pertinent marketing data in addition to names, ad- 80 dresses, and a brief description of the prospects for doing business. World Trade Directory Reports are supplied for each individual or firm recommended as a possible prospect. Completed applications for these surveys (forms obtainable from any of the Depart- ment's Field Offices or from the Department's Commer- cial Intelligence Division, Washington, D.C.), must be accompanied by sales literature and a $50 fee. Agency Index. U.S. Foreign Service posts through- out the world keep an index with the names and addresses of foreign representatives of U.S. firms. By using the index maintained in Chile, a U.S. commer- cial officer there can promptly refer inquiries to the U.S. businessman's agents, distributors, or licensees in Chile. Special Agency Index cards are available for completion and distribution overseas, free on request. Informational Services The Department welcomes business inquiries about any aspect of the Chilean economy, import regulations, and other specific information relating to trade and investment in Chile. Questions should be directed to any Commerce Department Field Office, or to the American Republics Division, Bureau of International Commerce, U.S. Department of Commerce, Washing- ton, D.C., 20230. The Department's publications include: International Commerce. A weekly magazine devoted to news about trade and investment abroad, International Commerce reports on general economic conditions in countries around the world and on changes in U.S. Government and foreign government regulations affecting trade and investment. Regular features are quarterly economic summaries describing key developments in the economies of the United States' trading partners, and periodic outlook articles by U.S. Commercial Attaches serving in foreign capi- tals and by the Department's country analysts. Each issue contains specific trade leads, scheduled arrival dates and U.S. addresses of foreign buyers and sellers, and schedules of commercial exhibitions in the United States and abroad. There are, in addition, reports pre- pared by the commodity specialists of the Depart- ment's Business and Defense Services Administration ( BSDA ) . All of these draw heavily upon information gathered throughout the world by the U.S. Foreign Service. The subscription price is $16 a year; remit- tance is payable to the U.S. Superintendent of Docu- ments. Subscriptions may be mailed to the Depart- ment's Field Offices or to the U.S. Superintendent of Documents, U.S. Government Printing Office, Washing- ton, D.C., 20402. Checklist: Bureau of International Commerce International Business Publications. This check- list gives current reports in the Overseas Business Reports (formerly World Trade Information Service) series, the special supplements to International Com- merce (such as this survey), and other international business publications of the Department. Free. Order from the Sales and Distribution Section, U.S. Depart- ment of Commerce, Washington, D.C., 20230. What You Should Know About Exporting. This is a how-to-get-started-in-exporting handbook. It gives full information on the Department's services to exporters as well as on private business aids to market- ing abroad. It is available from the Superintendent of Documents, U.S. Government Printing Office, Washing- ton, D.C., 20402, or from one of the Department's Field Offices. The price is 25 cents. DEPARTMENT OF AGRICULTURE Information on agricultural commodities, livestock, and agricultural development programs is available from the Foreign Agricultural Service and the Eco- nomic Research Service of the U.S. Department of Agriculture, Washington, D.C. The Department of Agriculture regularly publishes surveys on agricultural developments on both a worldwide, regional, and country basis. Its most recent publication devoted ex- clusively to Chile is entitled, Chile: Recent Trends in Agricultural Production and Trade (ERS-Foreign-84) , May 1964. DEPARTMENT OF INTERIOR The U.S. Department of the Interior through its Bureau of Commercial Fisheries and Bureau of Mines maintains and develops information on foreign fishery and minerals developments. The Bureau of Mines pub- lishes an annual Minerals Yearbook which provides a summary of the status of the mining industry in individual foreign countries. Reprints on individual countries, such as Chile, are available from the Bureau of Mines. EXIMBANK The credit facilities provided by the Foreign Credit Insurance Association (FCIA) and Eximbank in the insurance and guarantee field play an important role in support of U.S. sales abroad. These facilities are avail- able for the sale of both goods and services and assist U.S. exporters in extending credit to their Chilean customers on terms competitive with those of other foreign suppliers. The FCIA issues credit insurance for sales of goods on both short ( up to 180 days) and medium ( 181 days to 5 years) terms. Such policies usually provide coverage for both commercial and political risks, but may be obtained for political risks alone. Commercial risks include insolvency and protracted default. Politi- cal-risk coverage protects against currency inconverti- bility, cancellation or restriction of import or export licenses, expropriation or confiscation, and loss due to war, revolution, or civil disturbance. The Eximbank underwrites all or part of such policies. The exporter may prefer instead to apply for an Eximbank medium-term (181 days to 5 years) credit guarantee. Such guarantees are extended by the Exim- bank to commercial banks. The exporter thereby gains non-recourse financing from his bank, since the Exim- bank assumes the credit risk on early maturity of notes. Such coverage may be obtained for goods shipped on a lease or consignment basis, for those exhibited at trade fairs, as well as for regular commercial exports. Serv- ices in the form of economic surveys, engineering de- sign studies, and architectural studies are also eligible for guarantees. Further information, including the FCIA booklet, Guide to Export Credit Insurance for United States Businessmen, may be obtained by writing to Foreign Credit Insurance Association, 250 Broadway, New York, NY., 10007, or to the Export-Import Bank of Washington, Washington, D.C, 20571. AGENCY FOR INTERNATIONAL DEVELOPMENT AID administers the U.S. foreign economic assist- ance program in Chile. Chile is one of the largest recipients of U.S. economic assistance. Most of that assistance currently is in the form of program loans to finance commercial imports by the private sector. In addition, AID provides development grants and technical assistance in support of the Chilean develop- ment program. AID's activities include the provision of investment guarantees and the financing of invest- ment surveys. It also makes loans in local currency which are generated by the sale of surplus U.S. agricultural commodities ( Cooley loans ) under the Public Law 480, Food for Peace program. More complete information on AID programs as they apply to foreign trade and investment are in- cluded in the publications, Commercial Exports Under AID Programs, prepared by the AID Office of Material Resources, and Aids to Business (Overseas Investment ) prepared by the AID Office of Development Finance and Private Enterprise. Inquiries should be addressed to those Offices, Agency for International Development, U.S. Department of State, Washington, D.C, 20523. INTER-AMERICAN DEVELOPMENT BANK The IDB is a regional agency created by 20 Ameri- can Hemisphere nations — 19 Latin American countries and the United States — to accelerate the economic development of the member countries, individually and collectively. It is authorized to extend loans to govern- ments of member countries, to any of their political subdivisions, or to private enterprises within member 81 FINANCIAL AID: An Inter-American Development Bank loan for potable water facilities near Concepcion. .5 million helped finance construction of countries. The loans are used to finance development projects, including those which form part of a national or a regional program. In its lending operations, the bank seeks to give priority to undertakings which, in its opinion, will make the most effective contribution to the economic growth of its member countries. It makes loans only for the acquisition or expansion of capital assets or, in some cases, for technical services. It does not extend loans for the purchase of established enterprises, re- financing operations, or working capital. For practical reasons, the bank only considers loan requests in excess of a certain minimum amount, which varies for the individual members. Credit needs below these set levels are met by the bank through development loans for relending, which it makes to development institu- tions in the member countries. Although it is also authorized to guarantee loans to foreign entities, the bank's current policy is not to make such guarantees. For further information on IDB programs, write to Inter-American Development Bank, 808 17th Street, NW., Washington, D.C., 20577. 82 WORLD BANK The IBRD, commonly known as the World Bank, finances a large number of development projects throughout the world. Most contracts for the provision of goods and services for these projects are open to competitive bidding by member countries and Switzer- land. Information on procurement requirements is contained in the pamphlet, Guidelines Relating to Procurement Under World Bank Loans and IDA Credits, available from the International Bank for Reconstruction and Development, 1818 H Street, NW., Washington, D.C., 20433. inquirer's bank. However, they may reply to direct inquiries, and in such cases a nominal charge is made. Ordinarily such banks make no charge for inquiries channeled through their correspondents' or the in- quirer's bank. Nearly all the major U.S. banks are represented by correspondent banks in Chile. The only subsidiary of a U.S. banking firm located there is the First National City Bank of New York which has branches located in Santiago, Valparaiso, and Concepcion. This bank also prepares reports on general economic conditions, the business and investment climate, the country's trading posture, and specific industries. PRIVATE AIDS Credit Information Credit information on firms in Chile is available to the U.S. businessman from several private sources: Credit Reporting Agency. A Dun & Bradstreet Company subsidiary provides coverage for Chile through its office located in Santiago. Inquiries from U.S. firms should be requested through the company's office at 99 Church Street, New York, New York, 10008 or through any of the company's branches in the United States. Banks. Chilean banks prefer to receive credit inquiries from American firms through their corre- spondent banks in the United States or through the Other The Chile-American Association, which maintains offices at 149 Broadway, New York, New York, has as its objective the promotion of business and cultural relations between Chile and the United States. The National Foreign Trade Council at 10 Rocke- feller Plaza, New York, New York, has a nationwide membership of companies engaged in foreign trade and other business operations abroad. It provides in- formation and consultative services to members. The Foreign Commerce Department of the Chamber of Commerce of the United States also provides many services to U.S. exporters. It is located at 1615 H Street, NW., Washington, D.C., 20006. 83 CHAPTER VI Trade Regulations, Practices Chile regulates the flow of imports into the country by means of a rather complex system of tariff, sur- charge, deposit, exchange, and documentary regu- lations. These requirements and those with which the United States requires U.S. exporters to comply are summarized in this chapter. More complete informa- tion on this subject is contained in the Department's Bureau of International Commerce publication, Foreign Trade Regulations of Chile ( Overseas Business Report 65-84, December 1965) which is periodically brought up to date and republished. Changes in Chil- ean and U.S. regulations are reported in the Depart- ment of Commerce weekly publication, International Commerce. IMPORT TARIFF The Chilean tariff consists of a basic duty ( derechos basicos vigentes) and an additional ad valorem tax (impuestos ad valorem). The basic duty is generally expressed as a specific duty in terms of gold pesos per unit of weight (ordinarily the kilogram) . The gold peso, not a part of Chile's monetary system, is a constant standard for the expression of customs duties; it does not fluctuate with the value of the real currency, the escudo. One gold peso equals US$0.2061, or 4.852 gold pesos equal US$1. The additional taxes, applicable on most goods, are levied at rates of 3 per- cent, 30 percent, or 62 percent of the c.i.f. value, de- pending upon the degree of essentiality. The 62-per- cent category applies to most luxury-type imports, while the 30-percent category is the most common, applying to the widest range of goods. Chile accords preferential duty treatment (derechos convenidos) for some imports under agreements con- cluded with foreign countries. Since both Chile and the United States are parties to the General Agreement on Tariffs and Trade (GATT), any concession which either extends to any member of the GATT is auto- matically extended to all other members. An exception is made of concessions granted by Chile on a growing list of commodities to other members of LAFTA. The items on which these concessions are granted are com- piled either as Chile's National List or as part of the LAFTA common list. In addition to preferential duty treatment, these items are exempt from prior deposit and surcharge requirements. PERMITTED AND PROHIBITED IMPORTS The Chilean import system is based on a list of permitted and prohibited imports. Those goods not appearing on the permitted list are assumed to be pro- hibited. Although the list of permitted items is subject STEEL PLANT: Blast furnaces and unloading tower of Cia. de Acero del PacifLco, Huaohipato, Chile. 85 to frequent change, the following categories are gen- erally permitted: drugs and pharmaceuticals, special steels, heavy equipment and machinery, agricultural machinery, paper and paperboard, and industrial electrical apparatus. Prohibited imports, except for a small group of absolutely prohibited items, may be brought into the so-called free ports. Such goods brought into the free ports must first be assembled or processed before their shipment to the rest of Chile. IMPORT SURCHARGES Chile imposes import surcharges in amounts up to 400 percent of the c.i.f. value, which amount is based upon the priority attached to the imported goods. While the amount so charged is usually referred to as the import surcharge, it actually is the sum of two surcharges: the impuesto adicional and the impuesto adicional agregado. These surcharges may be waived for goods authorized for importation on extended credit terms (cobertura diferida ) and under special circumstances specified by Chilean legislation and the Central Bank. Thus, the Central Bank, on an indivi- dual basis, selects certain high priority imports fi- nanced by long-term U.S. economic assistance credits for exemption from the impuesto adicional agregado and prior deposit. IMPORT REGISTRATION Although no import license is required, import registration is required for all imports. Registration is effected by application to the Central Bank through an authorized commercial bank. Since January 15, 1965, import registration applications for one or more items during a particular month may be denied. Applications can be denied only when the total value of all applications for that calendar month exceeds the monthly average for the previous 12 months by more than 5 percent and when all other applications for the same import item during that calendar month are also rejected. However, a rejected application may be resubmitted in the next month. Applications not rejected under this authority must be approved within 90 days of presentation. Import registration requests must declare the volume and value of imports of similar merchandise effected during the previous calendar year and during the current year. The Central Bank has discretionary authority to approve or reject registrations of goods to be financed on extended credit terms under its deferred coverage system. On September 20, 1965, the Central Bank ruled that direct imports of spare parts, up to US$500 in value, can be made by end users themselves, i.e., not cus- 86 tomary importers, without prior import deposit or applying for registration in advance. The registration and deposit can be made at any time within 30 days from the date of shipment. IMPORT DEPOSIT The prior import deposit, placed through a commer- cial bank, is necessary for all permitted imports and is generally equivalent to the surcharges on the same item, which range from 0.1 to 400 percent. However, some items call for prior deposits as high as 10,000 percent of the c.i.f. value. Deposits are returnable after 90 days. The Chilean customs authorities are author- ized to clear goods not covered by an advance import deposit certificate up to a maximum value of $100, provided the goods are of a noncommercial value not requiring exchange cover and that the goods are in- cluded in the authorized list of imports. In order to register an import, the Central Bank insists that, in addition to the above-mentioned con- ditions, the importer submit a proforma invoice issued by the supplier or its authorized agent. These regu- lations enable the Central Bank to verify that the price of the commodity being imported corresponds to its present price in the international market. The deposit certificate received by the exporter is stamped by the Chilean Exchange Commission with the notation "Embarque Libre" ( free shipment for vessels of any registry ) or "Embarque en Nave Chil- ena" ( shipment in Chilean vessels or on lines under special contract, such as Chilean-U.S. pooling ar- rangements) . EXCHANGE CONTROLS Foreign exchange for payment of imports, obtain- able through the official bankers' market, is not made available until 80 days after the date of the bill of lading covering the shipment. For some time, most im- port transactions have been executed with exchange purchased in the bankers' futures market. On August 12, 1965, the Central Bank announced that no more than 7 percent simple annual interest may be charged by foreign exporters for delays in receiving payments. Foreign exchange will only be granted for this amount, in addition to the c.i.f. value of the merchandise, as shown on the import coverage application. FREE PORTS The main free port in Chile established in 1953 is Arica at the northern tip of the country. Goods going into Arica generally undergo processing or as- sembly for shipment into the mainstream of the CHILEAN EDUCATION: Students are trained in trade schools to operate industrial and mining machinery. Chilean economy. Most goods on the prohibited list may be shipped into Arica upon payment of regu- lar duties plus 200 percent of the c.i.f. value, and those on the permitted list may be imported into Arica free of prior deposits, although they too must pay the regular basic duty and additional tax. The customs surcharge for permitted goods brought into Arica is 25 percent rather than the normal rate indicated on the permitted list. Certain goods imported into Arica, however, are exempt from all customs duties and charges. This group includes foodstuffs, construction materials, most machinery, trucks, fuel, automobile parts, raw materials, and those commodities used in mining or agriculture or in the establishment or operation of regular industry. No goods obtaining these special exemptions may be shipped to the rest of Chile unless they have been first processed or assembled, in which case they are subject to charges that vary with the types of goods. The charge is either 50 percent or 75 percent of the normal customs duty (although no surcharge is levied) or is equivalent to full normal customs charges. Under Law 13,039 that established the free port, a few in- dustries in Arica may ship to the rest of Chile duty- free. Magallanes, Aysen, and Chiloe (provinces to the far south) were granted many free port privileges in 1956 although quota restrictions were in effect. In 1956 the Departments of Pisagua, Iquique, Taltal, and Chanaral were granted special import and export priv- ileges. There, equipment necessary for mining and re- lated operations may be imported free of restrictions. All imports into free ports are now transacted at the official bankers' exchange rate. SALES AND OTHER INTERNAL TAXES The general sales tax is 6 percent and applies on most goods. However, luxuries and special commodities are subject to varying sales taxes which are somewhat higher. Special taxes are applied in free port zones from time to time. DOCUMENTATION AND FEES As the Chilean consulate is no longer required to visa documents prior to shipment, exporters will not pay consular fees. The) will be paid, however, by the importer in Chile. 87 A commercial invoice is required on all freight, air cargo, or parcel post shipments to Chile. Copies of the commercial invoice must be prepared in quadruplicate in Spanish or English. The invoice must show clearly f.o.b. or f.a.s. steamer value in the extreme right-hand margin. C.i.f. value (itemized as to cost, insurance, and freight) must also be shown and must appear under and to the left of the f.o.b. or f.a.s. value. Unit price of each item must be shown. The import deposit certificate number covering the shipment must also be indicated on the invoice. Commercial invoices must contain the following declaration signed by the shipper, in English or Spanish: "Under oath we declare that we are the owners (or shippers) of the above mentioned merchandise, that the prices and other details are exact, that the said merchandise is a product of the soil or industry of (country of origin) and that we accept the legal consequence which might arise through any in- exactitude contained in this account." When the bill of lading includes goods covered by more than one commercial invoice, a summary in- voice should be used. It should contain the oath as given above and identify each item with reference to the corresponding invoice. The bill of lading (original and one copy required) must show total weights in metric units and total freight charges. If covering more than one item, indi- vidual weights in the metric scale must be shown. The import deposit certificate number must also be indi- cated. "To order" shipments are recognized in Chile pro- vided the name of the consignee is shown in paren- theses. The following information should be shown on the bill of lading: The name of the ship, the exporter, and the consignee; the kind, quantity, marks, and number of the packages; ports of shipment and of destination; and the amount of freight and insurance. Corrections, additions, or erasures are not permitted in the bill of lading, but if an error is discovered it may be rectified by a letter of correction. It is advis- able that problems of this kind be handled by a customs broker in Chile. An AID supplier's certificate (an original and four copies), signed by the supplier, must accompany all shipments of merchandise from the United States to Chile, whether AID-financed or not. LABELING AND MARKING REQUIREMENTS All imported products of a kind ordinarily con- sumed by the public must be marked or labeled with an indication of the country of origin before they may be placed on sale in Chile. Packaged goods, except those subject to the payment of stamp taxes, such as cigarettes, playing cards, and toilet preparations, must be marked to show the quality, purity, or mixture and the net weight or measure of the contents. Shipping cases must be stenciled (marking with a brush is not permitted) to show shipping marks and numbers and the gross weight in kilograms. The total gross weight of iron or steel bars, plates, pipes, and rails need not be given on individual pieces. However, the gross weight in kilograms must be indicated on each bundle of structural steel, coil or wire, and the like. Net weight is defined as the actual weight of the merchandise without wrapping or container. Legal weight is defined as including the weight of goods together with that of the immediate container and wrappings but excluding the crate, box, or other ex- terior container and shavings, straw, or other material used for packing the goods therein. The legal weight of such goods as powders, liquids, or granules im- ported loose in barrrels or other large containers in- cludes the weight of such containers. Gross weight is defined as including the weight of the merchandise and all containers, wrappers, and packing used in pre- paring the goods for shipment. A tolerance of 5 per- cent of the c.i.f. value (but not to exceed $1,000) is allowed if the merchandise is assessed according to volume or weight. SAMPLES AND ADVERTISING MATTER Samples obviously of no commercial value are duti- able at 0.03 gold peso (1 gold peso equals $0.2061) per kilogram of gross weight. If the samples have commercial value, duty is levied at the rate applying to commercial shipments of similar articles. Samples which otherwise would be subject to regular import duties will be admitted at the nominal rate of 0.03 gold peso per kilogram if mutilated so as to be unsalable. Dutiable samples may be admitted into Chile under bond or deposit of the full amount of the duty pay- able for a period fixed by the Superintendency of Customs. The goods must be declared, for customs purposes, on forms provided for that purpose and must be described in sufficient detail to enable the customs inspector to identify them at the time of both their entry and reexportation. Reexportation of samples is effected by an applica- tion, in triplicate, listing the articles to be withdrawn. A copy of the declaration submitted at the time the goods were imported must be attached to the applica- tion. If the samples are reexported within the pre- scribed time limit or its extension, the amount depos- ited will be refunded or the bond canceled. If only a part of the samples should be withdrawn, the amount of import duty applicable to those sold or otherwise disposed of within the country will be collected. 88 Samples carried in traveler's baggage are treated in the same manner as those sent by freight. Adver- tising matter is dutiable, but single catalogs are free. U.S. EXPORT CONTROLS All exports from the United States or its posses- sions to Chile are subject to the rules and regulations of the Office of Export Control, Bureau of Interna- tional Commerce, U.S. Department of Commerce, ex- cept exports of arms, ammunition, and implements of war, which are licensed by the U.S. Department of State; gold (except fabricated gold with a gold con- tent value of 90 percent or less) and narcotics, licensed by the U.S. Department of the Treasury; tobacco plants and seeds, licensed by the U.S. Depart- ment of Agriculture; vessels, licensed by the U.S. Maritime Administration; natural gas and electric energy, licensed by the U.S. Federal Power Commis- sion; and certain source material and facilities for the production of fissionable material, licensed by the U.S. Atomic Energy Commission. The regulations concerning export control are set forth in the Comprehensive Export Schedule, which is available for examination at the U.S. Department of Commerce or at any of its Field Offices. The Com- prehensive Export Schedule and supplementary Cur- rent Export Bulletin may be purchased from any U.S. Department of Commerce Field Office or from the Superintendent of Documents, U.S. Government Print- ing Office, Washington, D.C., 20402, at an annual subscription rate of $7 ( $2 additional for foreign mailing). The subscription year begins each April 1. Airmail service on the supplementary bulletins is available, to domestic subscribers only, at an addi- tional cost of $4 a year. A shipper's export declaration must be filed with the Collector of Customs for shipments requiring a validated export license and for most shipments under a general license. Information regarding the declara- tion may be obtained from the Foreign Trade Divi- sion, Bureau of the Census, U.S. Department of Com- merce, Washington, D.C., 20233. A destination control statement is necessary on ship- ping documents for all shipments requiring a vali- dated export license and most shipments made under a general license. Thus, the statement applies to vir- tually all commercial shipments from the United States. The major exceptions to the requirement for an appropriate statement are shipments intended for consumption in Canada (other than beet and cane sugar) ; shipments transiting the United States which do not require a validated export license; and ship- ments of certain publications and unclassified tech- nical data. Additional information concerning export control requirements for shipments to Chile may be obtained direct from the Office of Export Control, Bureau of International Commerce, Department of Commerce, Washington, D.C., 20230, or from any of the Depart- ment's Field Offices. OTHER CONTROLS The U.S. Treasury Department, Division of Foreign Assets Control, Washington, D.C., 20220, should be consulted for information on the foreign assets con- trol regulations, which prohibit all unlicensed trans- actions directly or indirectly involving mainland Chinese or North Korean financing or trade. These regulations, among other things, specifically prohibit the unlicensed purchase in any foreign country of all goods of mainland Chinese origin and all goods of types which in the past were chiefly imported into the United States from mainland China. The Division of Foreign Assets Control should also be consulted with respect to the transactions control regulations, which prohibit Americans from shipping strategic materials from any foreign country to a Soviet-bloc country. 89 Appendixes APPENDIX A. NOTES TO BUSINESSMEN Passports and Visas A business traveler or tourist usually needs only present his passport and a valid smallpox vaccination certificate for authorization to enter Chile. The authorization is good for 90 days. Inquiries concern- ing entry into Chile should be directed to one of the Chilean consular offices located in the United States ( see chapter IV ) . Information concerning the issu- ance of passports may be obtained from the U.S. Department of State, Washington, D.C., 20524; from Department of State passport offices in Boston, New York, Chicago, New Orleans, Los Angeles, and San Francisco; or from the clerk of a Federal District Court and some state courts. Travel There are no restrictions on the movements of busi- ness travelers in Chile. Chileans are basically a friendly, tolerant, hospitable people, and U.S. citizens need have no qualms about traveling anywhere they wish. International airports are located in Santiago and Antofogasta. Santiago is served by 14 international airlines, with a total of about 50 arrivals and depar- tures every week. Panagra is the only U.S. airline operating in Chile, with five round-trip jet flights to the United States a week. Travel time to New York from Santiago is about 14 hours; to Miami, 11 hours; and to Buenos Aires, l 1 /^ hours. LAN operates Caravelle jet flights to Miami as well as jet and DC-6B service throughout Chile, weather permitting. Check-in should be completed an hour ahead of scheduled departure on domestic flights, par- ticularly in winter and in the south where impending bad weather may necessitate a departure earlier than scheduled. LAN has an excellent safety record, its equipment is good, and its pilots are well trained. Fares are not expensive. Chile's chief industrial, economic, and tourist cen- ters are linked by an extensive rail network which is undergoing modernization. Five international rail- ways link Chile with its neighbors. Chilean trains are equipped with good quality coaches, sleepers, and dining cars with excellent accommodations and serv- ice. Fares are reasonable. Urban transportation facilities are severely strained after years of import restrictions. Taxis are numer- ous, but often hard to obtain; they are equipped with meters. Fares are inexpensive, with a 50-percent sur- charge after 11:00 P.M. and on holidays, and drivers do not expect tips except for extra services or for long trips on a flat-rate. Buses are cheap but crowded during rush hours. There is good and frequent interurban bus service between Santiago and most of the larger cities and coastal resorts of the country. These buses are mod- ern, comfortable, and in good condition. The Pan- American Highway provides hard surface travel the length of most of the country. Cars may be rented for the equivalent of about $8 to $23 a day, plus 8 to 12 cents a kilometer (0.625 miles ) . The acquisition of an international driver's license in the States will save time since application for a Chilean license takes a few days. Passenger ships of the Grace Line and the Gulf and South America Steam Ship Company call at RIO LAJA FALLS: Chile has fresh water streams as well as one of the driest deserts in the world, the Atacama. 91 Chilean ports. Sailing time between Valparaiso and New York is about 3 weeks. Many European and South American lines call at Chilean ports. Currency Regulations and Banks The official currency unit of Chile is the escudo (written E u ) which superseded the peso in 1960. The escudo is divided into units of 100 centesimos. How- ever, peso currency (1,000 pesos = 1 escudo) still circulates, and taxi drivers and waiters often quote prices in pesos instead of escudos. In past years, the escudo has been devalued periodically; therefore, it is not prudent to exchange all one's money at one time if a long stay is contemplated. Money may be legally exchanged only at banks and officially desig- nated hotels at the official broker's rate. Traveler's checks are acceptable at most banks and hotels. It is illegal for travelers to take Chilean currency out of the country. There are no prohibitions against bring- ing Chilean currency into Chile, although the bringing in of large amounts would necessitate an explanation. There are more than 25 banks in Santiago. The First National City Bank of New York is the only U.S. bank which maintains offices in Chile, including branches in Santiago, Valparaiso, and Concepcion. There are other foreign banks. Public banking hours are now 9:00 a.m. to 2:00 p.m. Hotel Accommodations and Restaurants There are several well-equipped hotels and apart- ment-hotels centrally located in Santiago, including one of the Hilton chain. Very comfortable accom- modations can be obtained for the equivalent of no more than $10 per day. There are also first-class accommodations in Chile's other cities, particularly near tourist attractions, but it is often wise to make reservations ahead, if possible. There are many fine restaurants in Chile, including those run by the larger hotels. Chicken dishes are probably Chile's most famous, although there are many others. Chilean wines are excellent and inex- pensive, as is food in general, compared with those in the United States. All hotel and restaurant bills include a service charge, but moderate additional tipping is customary. Business Hours Chile began, in early 1966, the changeover to the straight time shift (Jornada unica ) in the cities of Santiago, Valparaiso, Vina del Mar, Concepcion, Talcahuano, Tome, Penco, Lota, Chiguayante, and Coronel. The plan to have business and Government operating on a straight 8-hour day by July 1, 1966, has been only partly carried out. However, the work- day generally begins at the following times: Private offices and com- panies 8:15 to 8:45 a.m., weekly Government offices 8:30 to 9:00 a.m., weekly Factories and industries 6:30 to 8:00 a.m., weekly Banks and financial institu- tions 9:30 to 10:30 a.m., weekly Banks (public hours) 9:00 a.m. open, 2:00 p.m. close The workday may be extended beyond 8 hours by the amount of time an individual establishment may increase the official 30-minute lunch period, which ordinarily begins at 12 noon. Business lunches still tend to run 2 hours or more. A number of business firms, such as importers, exporters, wholesalers, and factories, open on Saturday mornings and operate until noon or a little later. Similarly, retail stores in Santiago and Valparaiso stay open Saturday morning. Retail stores in other cities also have afternoon hours on Saturday. The smaller cities and towns (which are not men- tioned above ) will eventually change to the new sys- tem but continue to operate on the following schedule for the time being: Office: Morning, 9/9:30 to 12:30/1:00 Afternoon, 2:30/3:00 to 6:30/7:00 Stores: Morning, 9:30 to 1:00 Afternoon, 4:00 to 8:00 Holidays and Vacation Periods There are 15 national and religious holidays on which business establishments are closed: January 1 — New Year's Day — Good Friday — Holy Saturday May 1— May Day May 7 — Corpus Christi May 21--Battle of Iquique — Ascension Day June 29 — Sts. Peter and Paul August 15 — Assumption Day September 18-19 — Independence Day October 12 — Columbus Day November 1 — All Saints' Day December 8 — Immaculate Conception December 25 — Christmas Day January and February are the favorite vacation months for Chilean businessmen. Those months are the height of the Chilean summer. Appointments may also be difficult to obtain during the weeks in which Christmas, New Year's, Easter, and Independence Day fall. 92 Communications International telephone service, much of it by radio- telephone, is satisfactory, depending upon atmospheric conditions. Rates to the United States are the equiva- lent of $10 for the first 3 minutes and $3 for each additional minute plus a 15-percent tax. Reduced rates are in effect on Sundays. There is domestic telephone service to all parts of Chile, although delays may be experienced in making connections. Telegraph service to the United States is good. The day rate is the equivalent of $0.50 per word. The night rate is under $6 per 22-word minimum, with each additional word costing $0.25. A 15-percent tax is added to these charges. The Chilean State Railways operates an extensive domestic telegraph service. Business correspondence goes by airmail because of the slowness of surface transport. Delivery time is 3 to 5 days (New York to Santiago). Air mail postage from Santiago to the United States is the equivalent of $0.08 per 5 grams (0.035 of an ounce). Clothing The climate in Santiago calls for about the same type of clothing that would be worn in San Fran- cisco, California. Because of the frequently inade- quate heating in winter, one will find heavier indoor clothing and sweaters welcome. Rainwear is a neces- sity during the winter; umbrellas are expensive in Chile. Chilean men dress conservatively, with dark suits the rule for dress wear and for most evening occa- sions. A lightweight dark suit may be desirable in summer (December to March), but may not be warm enough for some persons in the late afternoon and evening. Light colored suits are neither popular nor practical because of the difficulty, time, and expense in obtaining satisfactory dry cleaning. A topcoat and raincoat are more serviceable than a heavy overcoat. Hats are not worn as frequently in Chile as in the United States. White shirts are the rule, and name- brand readymade shirts, ties, underwear, socks, and pajamas are manufactured locally. Shoes are avail- able, but choice of lasts is limited; most shoes are made in only one width for each length. Large sizes are difficult to obtain. Formal wear may not be needed. The black dinner jacket is used throughout the year, although the white jacket is acceptable in summer. Chilean women are noted for being well dressed and well groomed and generally dress more formally than women in the United States. One should count on dres- sing warmly, particularly from April through October. Suits are particularly practical for business wear, heavyweight wool for winter, lightweight for between seasons. Linen, cotton, and synthetic fabrics are worn in summer. Suits with contrasting blouses, dress and jacket combinations, or sleeveless dresses are worn for street and office. A light wrap or matching sweater and stole will be welcome after sundown. Chilean women almost never wear hats, but wear the traditional man- tillas for church services and other solemn occasions. Shoes, underwear, sleepwear, and stockings are avail- able locally at reasonable prices. Short silk or wool cocktail dresses are suitable for more formal dinners and cocktail parties, while full-length evening gowns are almost never worn. Health and Medicine The general level of community health is quite high in Santiago as compared with most other large Latin American cities. There is an efficient sewage and gar- bage disposal system; the streets are cleaned regu- larly, and there is no serious vermin control problem. Water, in Santiago, is purified and safe for drinking most of the time, although some residents prefer to boil drinking water. Foods and beverages are gen- erally perfectly safe, although discretion should be exercised in the selection of restaurants. If there is reason for doubt, fresh vegetables (particularly of the leafy variety ) and raw fruit with skin attached should be avoided because of the possibility of insufficient washing. Milk is pasteurized, but usually boiled be- fore using because of the frequent absence of refrig- erated distribution facilities. Outside of the larger cities, water should be re- garded as contaminated, and food ( particularly un- cooked food) selected with caution. Respiratory ailments are a problem to some resi- dents because of the deceptively mild climate, sharp changes between day and night temperatures, drafty or poorly heated buildings, and smog. However, the one disorder that a short-time visitor might encounter is an intestinal upset ( indigestion and diarrhea ) . The average person will probably encounter no seri- ous health problems if he uses common sense in his living pattern. Smallpox, typhoid, and polio immunizations are recommended for all travelers to Chile, and typhus for anyone traveling extensively through the country. Anyone contemplating a more lengthy stay might wish to have the added protection against hepatitis which gamma globulin injections provide. There are several modern, well-equipped hospitals in Santiago, and a body of well-trained medical and dental personnel, many of whom speak English. Other than the most exceptional cases, nearly any disease or disorder can be competently treated in Chile. Sat- isfactory prescription eyeglasses, including bifocals. can be obtained also. There are many pharmacies, including all-night shops, with a broad range of high- 93 quality stock. Only the most specialized prescriptions need be brought with the traveler. Electric Current and Weights and Measures Electric current is 220 volts, 50 cycles, single-phase, two-wire. Transformers must be used with 110-volt appliances, such as razors, and are available in hotels. Appliances with 50-60 cycle motors are operable with- out conversion, but 60-cycle electric clocks obviously are of no use. Chile employs the metric system of weights and measures: 1 meter = 39.37 inches 1 kilometer =0.62 miles 1 kilogram = 2. 20 pounds 1 liter = 1.06 liquid quarts 1 liter = 0.26 U.S. gallons 1 inch = 2.54 centimeters 1 mile = 1.61 kilometers 1 pound = 0.45 kilograms 1 liquid quart = 0.95 liters 1 U.S. gallon = 3.79 liters U.S. Representation The American Embassy is located on the seventh through ninth floors of the Codina Building at Agus- tina 1343 in downtown Santiago on the edge of the Plaza de la Constitucion. All Embassy sections except for the Economic and Commercial, Consular and Agriculture sections are located there. The office of the Commercial Attache and the com- mercial library are now located on the second floor of a commercial building at Alameda Bernardo O'Hig- gins 1146, four blocks from the Embassy. AID has its offices on the second and seventh through tenth floors of the same building. The Consular Section and the office of the Agricultural Attache are located in the Chancery Annex at Merced 250 facing the Parque Forestal about 13 blocks from the Embassy. The Embassy and Chancery Annex hours are 9:00 to 1:00 and 2:15 to 6:15, weekly. They may be reached by telephone on numbers 82801 through 82809. Office hours for the Economic and Commer- cial section and AID are 9:00 to 12:30 and 1:30 to 6:00, weekly. Their telephone numbers are 82641 through 82645. The only other Foreign Service post in Chile is the consulate in Antofagasta. There are consular agencies in Valparaiso and Concepcion. The United States Information Agency-USIA, Peace Corps, National Aeronautics and Space Administra- tion-NASA, Inter-American Geodetic Survey, and Department of Defense are also represented in Chile. APPENDIX B. ECONOMIC REGIONS North The North extends from the Peruvian border to approximately latitude 27° S. This region comprises the Provinces of Tarapaca and Antofagasta. It is almost entirely dependent on mining for its livelihood. This region accounts for all the Chilean output of nitrate, iodine, and sulfur and for about 60 percent of the copper. In recent years, fishing has expanded greatly and there has been a moderate increase in individual activity. Agriculture adds little to the econ- omy. Almost all foodstuffs must be imported from central and southern Chile or from abroad. Antofagasta. — With an estimated population of 89,114 at the end of 1960, Antofagasta is the eighth largest city in Chile and the most important com- mercial center in the North. It lies 222 nautical miles south of Iquique and 571 nautical miles north of Valparaiso. Transportation facilities are excellent and include rail links with Bolivia, Salta in Argentina, and all points south of Iquique. Chile also has an interna- tional airport. There are good road connections with the Maria Elena and Pedro de Valdivia nitrate plants, as well as with the Chuquicamata copper mine and the explosives plant in Calama. Imports and exports of large copper and nitrate companies located in this area are made through Antofagasta as well as through the smaller port of Tocopilla. Industries include a brewery, two fish canneries, a sulfuric acid plant, a gas plant, several foundries, and establishments pro- ducing spaghetti, oxygen, soap, and candles. Calama. — With a population of 56,330 in 1960, Calama ranks as the second largest city in the North. It is located about 90 miles inland from the port of Tocopilla and about 7 miles from Anaconda Mining Company's Chuquicamata copper mine — the world's largest copper mine. Iquique. — Situated 108 nautical miles south of Arica, with a population of 51,468 in 1960, Iquique is the third largest city in the North. It is the focal point for the recently expanded fishmeal and fish oil activities of the North. It has several fish canneries, including the largest cannery in Chile. It is the re- gional headquarters for the Cia. Salitrera de Tarapaca 94 y Antofagasta, the second largest nitrate producer whose mechanical nitrate plant at Victoria can be reached by road from Iquique. There are still a few Shanks plants in operation in this area. Iquique is also the northern headquarters for the guano industry. It has a large whaling station; a gas plant; and establishments producing mixed fertilizers, sodium and potassium silicates, salt, lime, and mineral waters. Arica. — Located just south of the Peruvian border and 885 nautical miles north of Valparaiso, Arica had a population of 46,294 in 1960. To benefit from the tax and other incentives offered by the free port law, a number of industries have been established in Arica. These include assembly plants for automobiles and small trucks, motorbikes, storage batteries, and other automotive parts such as brake linings, radios and television sets, textiles, toys, aluminum window cast- ings, carbon paper, typewriter ribbons, and fishmeal. The future status of industry in Arica is uncertain because of the continuing curtailment of free-port privileges and growing interest in locating manufac- turing activities closer to major production and con- sumption centers. The city is also the terminus of the Arica-La Paz Railway and imports in transit to Bo- livia enter here. North Central The North Central, with a population of 471,781 in 1963, was once the world's most important copper producing area and a leading producer of silver as well. This region includes the provinces of Atacama and Coquimbo. The rich ores which supported those activities have long since been exhausted although the small- and medium-sized enterprises which are active everywhere throughout the area still provide between 5 and 7 percent of the country's copper output and a substantial percentage of the mine and placer gold. The region also accounts for all of the iron ore, man- ganese, mercury, and apatite production of Chile. Agriculture in this region becomes progressively more important from north to south until finally, in south- ern Coquimbo, it is the mainstay of the economy. Many near-tropical products are raised in its fertile river valleys. The raisins of Huasco and the pisco from Elqui are famous throughout the country. Manu- facturing is of little importance in north central Chile. Excellent food fish are caught along the coast, but the fishing industry is not well developed. The cities of Coquimbo and La Serena, together with the port of Guayacan, formed a metropolitan area of some 100,000 inhabitants in 1960. This area is the principal commercial nucleus of the region, but such towns as Ovalle (46,553), Copiapo (37,224), Vallenar (30,793), and Chanaral (26,997) are of commercial significance. Coquimbo lies 200 nautical miles north of Valparaiso and is a port of entry for imports for the area between Copiapo and Ovalle. Guayacan and Chanaral are important mineral export- ing ports. La Serena (population 55,708) lies less than 8 miles to the northeast. Offices of the Bethlehem-Chile Iron Mines Co. are located here. The El Tofo mine lies about 45 miles to the north and the El Romeral mine about 15 miles to the north. A large cement plant, a ferromanganese plant, and several smaller industries are located in the neighborhood. Central With its population in excess of 5 million, the Cen- tral is the heartland of Chile. About 65 percent of all imports are destined to this region. It comprises the Provinces of Aconcagua, Valparaiso, Santiago, O'Higgins, Colchagua, Curico, Talca, Maule, Linares, and Nuble. It includes the Aconcagua Valley and the Central Valley as far south as the Bio-Bio River. These valleys form one of the richest agricultural areas in South America. Central Chile accounts for over one-third of the mining output, over one-half of the agricultural production, and three-fourths of the value of manufactures of the entire country. It has an invigorating climate and the best transportation and communications facilities in Chile. Its population is concentrated in the Provinces of Santiago and Valparaiso which together had an esti- mated population of 3.4 million in 1963. at least four- fifths of which may be classified as urban. These two Provinces account for a little more than two- fifths of the country's total population. They also account for over two-thirds of the total value of manu- facturing output and over half of the value of all imports consumed. Greater Santiago. — With an estimated population in excess of 2.4 million in January 1966, Greater Santiago is Chile's principal city. It lies at the foot of the massive, snow-covered central Andes at the northern end of the Central Valley at an altitude of 1,706 feet. It is 116 miles by rail from Valparaiso, 1,238 miles from Iquique, and 671 miles from Puerto Montt. Its Los Cerillos Airport is 5,122 air-miles from New York and 7,239 air-miles from Paris. A new international airport, to replace Los Cerillos. for jet traffic is under construction at Pudahuel and is expected to be in operation by December l'J66. Santiago is the headquarters for most of the major mining, industrial, distributing, banking, and commer- cial enterprises. It is the principal medical center of Chile and the seat of the country's two largest univer- sities. Living conditions are healthful, and the city can provide virtually all the conveniences of modern living. 95 SANTIAGO STOCKYARDS: A huaso (Chilean cowboy) does the same job as his counterpart in Colorado does when selecting cattle for sale. Valparaiso and Vina del Mar. — The twin cities of Valparaiso and Vina del Mar form one of the handsomest metropolitan areas in Latin America. The combined population of the two cities was close to 400,000 in I960 and many thousands more live in the lovely towns on the railway to the east, served by articulated electric suburban trains. In summer the population is further swelled by the thousands who flock from the warm interior to spend their vaca- tions or the entire season in Vina del Mar or at one of the resorts which line the coast from Papudo in the north to Cartagena in the south. Valparaiso (population 259,241 in 1960) is the principal port of Chile. It is 4,638 nautical miles from New York, 2,622 nautical miles from Balboa, Panama, and 1,438 nautical miles from Punta Arenas, on the southern end of Chile, via the outside passage. It is Chile's second most important industrial and commercial center, although Concepcion is growing rapidly and may eventually surpass it. CORFO is 96 considering the development of an industrial park in Valparaiso. Vina del Mar (population 126,441 in 1960) is usually described as the principal summer resort of the Pacific coast of South America. The city is also the site of numerous industrial plants, including the largest sugar refineries, soap factories, and vegetable- oil mills in Chile. The Concon petroleum refinery is situated just north of Vina del Mar. It already pro- vides raw materials for the manufacture of some chemical products, and is expected to play a primary role in the development of a petrochemical industry. Other cities. — The Central Region has a large number of other towns and cities of some significance. These include Chilian (82,947), Talca (80,277), Ran- cagua (61,830), Curico (51,721), Linares (51,480), Quillota (41,910), and Quilpue (40,902). South Central The South Central, with a 1960 population of 1,361,434, comprises the Provinces of Concepcion, Arauco, Bio-Bio, Malleco, and Cautin, and accounts for 18 percent of the population of Chile. While it covers only 7.3 percent of the country's total area, it has 33.1 percent of Chile's arable land. It accounts for about one-third of both the cattle population and cereal output, and for a major share of lumber output and the fish catch. It is one of the most rapidly grow- ing industrial areas of Chile, the center for steel production, the major pulp and paper producer, and the site of a petroleum refinery at Concepcion which is to be completed in 1966. The refinery will be the principal supplier of raw materials for a major petro- chemical complex to be located there. The industrial complex of south central Chile is concentrated mainly on the coast from Tome in the north to Lota in the south, a distance of some 45 miles. Included in this area are Concepcion-Talca- huano (primary and secondary iron and steel prod- ucts); Tome (woolens); Lirquen (flat and plate glass); Penco (sugar refining, fertilizers, chinaware, sanitary fixtures); Chiguayante (textiles); Coronel (coal mines) ; and Lota (coal mines and refractories). Concepcion. — With an estimated 1960 popula- tion of 167,468, Concepcion is the third largest city in Chile. It shows the rising tempo of its economic life and may eventually challenge Valparaiso for the title of Chile's second most important city. Talcahnano. — With a population of 99,231 in 1960, Talcahuano lies approximately 10 miles to the northwest of Concepcion although the intervening areas have been largely occupied by residential and industrial districts. Talcahuano, the port for Concep- cion, is the most important port in southern Chile. It lies 239 nautical miles south of Valparaiso and 363 miles southwest of Santiago by rail. Contiguous to Talcahuano but on San Vicente Bay is the Huachi- pato industrial district with its steel mill and ferro- alloy, carbide, lime, and wire products works. A major port is scheduled for construction on the bay. Other cities. — Other cities of significance in the South Central Region include Temuco (111,641), Los Angeles (75,639), Coronel (60,234), Lota (51,679), Tome (41,121), and Angol (32,816). Temuco is an important lumber, agricultural, and livestock center with flour mills, tanneries, and a number of other important industries. Los Angeles is the center of an important beet sugar industry. Tome is noted as a woolen textile center, and Coronel and Lota are the sites of the coal industry. Lake Region The Lake Region, with a population of 634,041 in 1963, comprises the provinces of Valdivia, Osorno, and Llanquihue. This region supplies about a quarter of the cereal and potato production and over half of the lumber production of Chile. It has one-fourth of the cattle population and ranks second in hog and fourth in sheep raising. It is an important dairy area and pro- duces most of the Chilean apple crop. Industry pro- vides only minor support to the economy except in areas such as Valdivia and Osorno. Osorno. — With a population of 93,686 in 1960, Osorno is an important tourist center and an over- night stop on the southernmost lake route from San- tiago to Buenos Aires. Commercially, Osorno has im- portance as a local distributing center and it also has a number of important industries, including one of the largest dry milk plants in Latin America, one of the largest butter plants in Chile, a modern packing plant shipping chilled beef to the north, important flour mills, foundries. Valdivia. — With an estimated population of 69,904 in 1960, Valdivia ranks as Chile's sixth largest city. Located on the Calle-Calle River 9 miles from its mouth and 11 miles from its port at Corral, Valdivia is 536 miles south of Santiago by rail. The city is the fourth most important industrial center in the Re- public. The output of its major industries includes shoes, leather, freight cars, tugs and lighters, beer, paper, refined sugar, liquors, flour, and wood products. The wood products include veneers, treated lumber, sash and doors. Valdivia also produces leather belting, ceramics, nails, crackers, and alimentary pastes. Other cities. — Other locally important centers in- clude Puerto Montt (64,775) which supplies over half of the shellfish consumption in Chile, Panguipulli (34,482), La Union (28,780), and Rio Bueno ( 26,743 ) . Austral Region The Austral had a population estimated at 233.396 in 1963; it comprises the Provinces of Chiloe, Aysen, and Magallanes. It in reality contains three quite distinct and entirely independent economic sections. The northernmost area includes the island of Chiloe and the islands in the Gulf of Corcovado. The main- land portion of the Province of Chiloe is largely un- inhabited. The central area is composed of the Aysen and Coihaique Valleys and the transandean lands as far south as Chile Chico. The southernmost area includes all of the Province of Magallanes. A few iso- lated instances of economic activity are found else- where, such as the limestone quarries of the Huachi- pato steel mill on Guarello Island and some lumbering on the mainland opposite the island of Chiloe. The island of Chiloe is separated from the main- land by the Straits of Chacao. A ferry service between 97 PETROLEUM PIPELINE: Propane and butane pipelines head north from Port Percy, Tierra del Fuego Is'and, Magallanes, Chile, to central Chile. Liquid petroleum gas is stored here in this part of the facilities of the Empresa Nacional del Petroleo. the island and the mainland was inaugurated in 1964. The island has an area of approximately 3,224 square miles. Its principal towns are Ancud (population 18,207 in I960) and Castro (18,2621. They are con- nected by a railway and a highway. The western part of the island is heavily timbered. The Chilotes, as its inhabitants are called, do some lumbering and fishing and raise large amounts of potatoes and small crops of cereals. Many of them enter the merchant marine, while hundreds journey each year to Magal- lanes for the wool clip. The Aysen-Coihaique area has been opened up only since 1929. It has grown slowly but steadily over the years. Aysen (population 10,662 in 1960) and Coi- haique (16,217) are supported by the sheep and cattle industry, which form the basis for the economy of the area. There is also some copper, lead, and zinc mining in the neighborhood of the Lago de Buenos Aires, most of the production being shipped across the lake to Chile Chico and then via the Argentine highway system to market. Magallanes is the most important economic area in this region. The Atlantic side encompasses great plains supporting some 2.5 million sheep which pro- duce over 20 million pounds of wool each year. This Province has the only oil and gas fields to be located and exploited in Chile. These are located on the northeastern part of the island of Tierra del Fuego or very nearby. Gases are processed in two refineries on the island, although most gas derived from oil- drilling operations is reinjected. Chile hopes to use this gas in its planned development of a petrochemical industry. Most of the crude oil produced is now shipped north to the Concon refinery. There are large deposits of low-grade coal and lignite as well as peat in Magallanes, but actual pro- duction is small. There is some gold placer mining, silver fox farming, and lumbering. There is no agri- culture, and fishing is of secondary importance. Punta Arenas. — Punta Arenas (population 52,595 in 1960) is the world's southernmost city. It lies 1,688 nautical miles southeast of Valparaiso (via Puerto Montt ) , 1,295 nautical miles southwest of Buenos Aires, and 6,146 nautical miles south of New York. Punta Arenas is a free port. Other cities. — The only other towns of any con- sequence are Puerto Natales (population 11,053), 158 miles northwest of Punta Arenas by road, and Por- venir (3,017), across the Straits of Magellan from Punta Arenas. 98 APPENDIX C. BIBLIOGRAPHY Chilean Government, Santiago Banco Central de Chile, Bole tin Mensual, monthly. Most up-to-date single source on current Chilean economic statistics. Banco Central de Chile, Trigesirna Novena Memoria Anual, annual. 1964 edition published June 1965. Camara de Comercio de Santiago, Comercio Exterior, Chile (trade statistics compiled from official pre- liminary customs data ) , annual, most recent issues 1963 and 1964. Corporacion de Fomento de la Produccion, Cuentas Nacionales de Chile, 1940-62, June 1963, 55 pp., 1958-63, June 1964, 30 pp. Corporacion de Fomento de la Produccion, Geografia Economica de Chile, Vol. I, 1950, 428 pp.; Vol. II, 1950, 545 pp.; Vol. Ill, 1962, 484 pp.; Vol. IV, 459 pp.: and revised edition, 1965, 885 pp.; San- tiago. Revised 1965 edition condenses and updates vols. I-IV. Corporacion de Fomento de la Produccion, Memoria, annual. Most recent issue 1964. Corporacion de Fomento de la Produccion, Chile's National Economic Development Program 1961-70: A Summary, 1961, New York, 151 pp. Corporacion de Fomento de la Produccion, Synopsis of the National Program of Economic Development 1961-70, 1961, 19 pp. Direccion de Estadistica y Censos. Boletin, monthly with annual December synopsis. Most recent synop- sis in December, 1964. Direccion de Estadistica y Censos, Comercio Exterior (official trade statistics), annual. Most recent issue 1962. U.S. Government, Washington, D.C. Department of Commerce Bureau of International Commerce Overseas Business Reports Basic Data on the Economy of Chile, OBR 64-138, December 1964, 24 pp., 15 cents. Foreign Trade Regulations of Chile, OBR 64-23, December 1965, 6 pp. Office of Business Economics Survey of Current Business, monthly. Bureau of the Census U.S. Export Statistics: Commodity by Country, Report FT -410, monthly cumulative and annual. U.S. Export Statistics: Country by Commodity Grouping, Report FT -420 monthly, cumulative and annual. U.S. Import Statistics, Report FT-125, monthly cumulative and annual. Department of Agriculture Economic Research Service Chile: Recent trends in Agricultural Production and Trade, May 1964, 12 pp. Agricultural Policies of Foreign Governments, Including Trade Policies Affecting Agriculture, Agriculture Handbook No. 132, March 1964, 266 pp. Food Balances for 24 Countries of the Western Hemisphere, 1959-61, ERS-Foreign 86, August 1964, 29 pp. Indices of Agricultural Production for the 20 Latin American Countries: Revised 1954 through 1964, Preliminary 1965, ERS-Foreign 44, January 1966, 26 pp. The 1965 Western Hemisphere Agricultural Situation, ERS-Foreign 113, February 1965. 67 pp. The World Food Budget: 1970, Foreign Agri- culture Economic Report No. 19. October 1964, 105 pp. Department of Interior Minerals Yearbook, annual. International institutions Inter-American Development Bank. Social Progress Trust Fund, Annual Reports, 1961- 1965, Washington, D.C. International Monetary Fund. International Financial Statistics, monthly, Washington, D.C. Pan American Union, A Statement of the Laws of Chile in Matters Affecting Business, 1962, 242 pp., Supplement No. 1, 1965, 43 pp., Washington. D.C. Pan American Union, Sistemas Tributarios de America Latina: Chile, (Tax Systems of Latin America: Chile), 1964, Washington, D. C. 106 pp. United Nations, Statistical Bulletin for Latin America, Economic Commission for Latin America, semiannual, New York. United Nations, Statistical Yearbook, annual. New York. United Nations, Yearbook of International Trade Statistics, annual, New York. Citation of other publications which may be useful to the U.S. exporter to Chile are contained in Chapter V: Marketing Aids. 99 APPENDIX D. APPENDIX TABLES Table 1. — Chilean Imports, by Sections and Commodity Groups, Total and from Principal Suppliers, 1961-64 [Thousands of dollars] Section Group Description 1961 Value/supplier 1962 1963 1964 I Mineral Products _ 36,660 US 13.701 VZ 6,976 NA 6,211 PR 3,450 1 Ores, crude or simply worked ; pure metals 4,324 UK 1,805 US 1,483 CN 331 2 Nonmetallic minerals, crude or simply worked 3,16? US 2,522 PR 259 C,R 135 4 Coal and mineral fuels 29,168 US 9.697 VZ 6,976 NA 6,211 PR 2,962 II Natural water and forest products 4,991 US 2,118 UK 931 SG 863 5 Unworked wood 119 US 88 PR 18 6 Other forest products 4,873 US 2,030 UK 931 SG 863 III Animal products (unmanufactured) 38,250 AR 34,993 UK 1,618 UR 507 7 Hunting products 13 UK 6 US 5 8 Fishery products 70 NO 27 JP 12 9 Live animals 31,027 AR 30,869 US 76 10 Wool and other textiles of animal origin, crude 4,269 AR 1,758 UK 1,556 11 Hides and skins and animal offal, crude 2,435 AR 2,365 GR 36 12 Aviculture, apiculture, and sericulture 436 GR 300 US 84 IV Agricultural products 41,936 US 12,590 PR 6,544 BR 5.414 AR 5,054 28.859 28,091 34,652 VZ 10,131 VZ 7,526 US 14.668 us 6,037 US 7,015 VZ 5,845 NA 5,672 NA 6,047 NA 5,228 PR 2,554 PR 2,247 PR 2,713 3,275 5,076 6,819 US 1,401 US 2,285 US 2,322 UK 1,267 UK 1,368 UK 2,263 PR 246 CN 568 MX 894 1,853 2,292 4,009 US 975 US 1,140 US 2.952 PR 230 GR 251 PR 278 AR 208 PR 223 GR 262 23,731 20,723 23,730 VZ 10,131 VZ 7,256 US 9,393 NA 5,664 NA 6,047 VZ 5,845 US 3,661 US 3,590 NA 5,181 PR 2,078 PR 1,667 PR 1,850 3,410 7,370 4,009 UK 1,099 UK 2,627 US 2,952 US 984 US 2,055 PR 277 SG 543 SP 684 GR 262 37 84 87 US 16 US 46 US 55 PR 14 AR 29 PR 16 US 968 7,286 6,332 3,373 UK 2,627 US 2,033 UK 1,099 US 2,009 UK 1,991 SG 543 SP 684 FM 817 29,740 28,623 37,422 AR 25,930 AR 26,141 AR 35,584 UK 2,104 US 760 UR 505 GR 270 GR 645 GR 445 13 UK 12 US 1 30 16 17 HG 9 NO 6 NO 7 NO 9 US 3 DN 5 24,314 18,749 27,740 AR 24,019 AR 18,487 AR 27,186 US 179 US 129 AU 317 4,061 6,178 5,974 UK 2.035 AR 4,922 AR 5,654 AR 986 UR 760 UR 198 988 2,803 3,080 AR 925 AR 2,732 AR 2,724 UR 23 GR 53 UR 307 334 877 610 GR 1G2 GR 566 GR 405 FR 78 UK 177 UK 123 56,965 95,787 61,794 US 19,394 US 31,377 US 21,094 PR 17,144 PR 21,465 MX 10,719 BR 5,391 BR 10,868 PR 8,497 AR 3,690 EC 7,198 BR 8,457 100 Table 1. Chilean Imports, by Sections and Commodity Groups, Total and from Principal Suppliers, 1961-64 continued [Thousands of dollars] Section Group Description 13 Live plants and seeds 14 Cereals 15 Legumes 16 Fruits and vegetables 17 Vegetable food products, stimulants 18 Spices 19 Forage and animal feeds, n.e.s 20 Raw textile materials of vegetable origin 21 Oleaginous vegetable materials, crude 22 Tobacco, crude V Manufactured food products 24 Meats, including jerked and salted 25 Edible fats and derivatives 1961 Value/supplier 1962 1963 »49 1,039 US 402 US 592 GR 157 IT 145 cu 103 GR 117 7,422 18,983 AR 4,692 US 15,375 US 2,678 AR 3,582 UR 30 UR 18 BR 13 BR 6 60 123 US 59 US 123 2,529 2,814 EC 2,196 EC 2,448 AR 259 PR 283 13,895 12,728 BR 5,188 BR 5,257 CY 3,990 CY 3,577 UK 2.334 UK 2,423 375 192 US 84 SG 58 SG 71 US 38 UK 69 UK 26 14 1 PR 9 AR 1 AR 4 US 1 14,780 20,548 US 7,754 PR 16,787 PR 6,513 US 2,338 MX 207 MX 1,139 114 25 BR 75 EC 11 EC 35 AR 9 1,797 511 US 1,279 US 403 UK 307 CN 79 41,230 37,804 PR 11,645 US 10,453 AR 9,883 AR 8,373 US 9,747 CU 4,821 UR 3,324 NE 3,275 4,152 4,300 AR 4,037 AR 4,112 NE 45 DN 109 2,621 2,328 AR 2,343 AR 1,823 US 224 US 274 NE 25 NE 210 NZ 15 UR 213 805 US 596 AU 54 DN 43 28.350 US 22,398 AR 4,378 UR 894 AU 671 US 7,487 EC 6,952 PR 440 22,210 BR 10,131 CY 6,992 UK 2,163 254 CY 63 BR 48 UK 41 1 AR 1 31,848 PR 20,535 MX 5,753 US 4,338 98 EC r»8 BR 35 4,725 US 3,720 UK 394 49,295 AR 11,847 US 10,286 CU 8,739 BR 4,222 2,820 AR 2,736 DN 66 4,616 AR 3,659 NE 582 US 346 DN 14 1964 1,013 US 704 NZ 71 GR 65 20,078 US 16,987 SP 1,181 UR 970 AR 887 4 US 4 3,618 EC 3,331 PR 192 14,326 BR 8,242 AR 2,372 CY 1,454 173 BR 76 CY 35 UK 17 3 AR 2 US 2 19,476 MX 10,612 PR 8.205 US 293 56 EC 47 MX 5 3.048 US 2,758 UK 142 53,612 PR 18,246 AR 12,135 US 11,543 DR 2,199 8,257 AR 8,104 UR 126 2,532 AR 1,651 US 471 NE 241 GR 140 Notes : AR — Argentina AU — Australia BL — Belgium BR — Brazil CN — Canada CU — Cuba CY — Ceylon CZ — Czechoslovakia DN — Denmark DR — Dominican Republic EC — Ecuador FM — Malaya, Federation of FN — Finland FR — France GR — Germany, Federal Republic of HG — Hong Kong IN — India IT — Italy JP — Japan MX — Mexico NA — Netherlands Antille: NE — Netherlands NO — Norway NZ — New Zealand PH — Philippines PK — Pakistan PN — Panama PO — Portugal PR — Peru SD — Sweden SG — Singapore SP — Spain SZ — Switzerland UK — United Kingdom UR — Uruguay US — United States VZ — Venezuela 101 Table 1. — Chilean Imports, by Sections and Commodity Groups, Total and from Principal Suppliers, 1961-64 continued [Thousands of dollars] Section Group Description 1961 Value/supplier 1962 1963 1964 26 Milk, cheese, and butter 27 Starch, flour or meal, and derivatives 28 Edible oils 29 Preserved and prepared foods 30 Sugar and derivatives VI Beverages 31 Wines 32 Spirits and liqueurs 33 Beer and cider 34 Mineral waters and other non-alcoholic beverages VII Manufactured tobacco 35 Prepared tobacco 36 Cigars and cigarettes VIII Textile products 37 Yarns 38 Cordage 5,396 8,593 9,522 5,450 AR 2,214 DN 2,271 US 3,067 US 4,237 US 2,081 US 2,032 AR 2,710 AR 779 NE 778 NE 1,458 NE 1,456 NE 251 DN 254 PO 924 DN 1,209 DN 80 3,757 4,630 3,054 3,074 US 3,100 US 3,625 US 1,811 US 2,909 FR 462 FR 906 FR 710 FR 69 GR 98 CN 63 GR 386 GR 44 5,091 6,063 6,502 5,029 US 3,435 US 3,894 US 4,788 US 3,506 NE 830 NE 1,462 NE 989 NE 747 DN 385 DN 240 DN 299 DN 385 2,753 1,985 1,187 805 US 669 US 518 UK 289 UK 198 UK 485 UK 389 US 222 US 151 SZ 375 SZ 290 SZ 187 AR 104 17,460 9,905 21,593 28,465 PR 11,640 cu 4,821 cu 8,739 PR 18,217 BR 3.323 AR 1,571 BR 4,163 DR 2,199 AR 909 BR 1,047 AR 2,503 UK 1,693 1,455 738 442 393 UK 936 UK 456 UK 271 UK 273 PR 173 us 89 US 46 US 33 US 106 DN 50 FR 41 FR 30 FR 60 FR 46 DN 28 DN 20 62 30 23 23 FR 22 FR 13 FR 12 FR 11 SP 17 SP 6 PO 3 UK 4 1,026 549 357 334 UK 897 UK 433 UK 257 UK 256 FR 36 DN 31 FR 20 FR 19 112 34 4 1 PR 40 PR 17 US 1 256 124 59 35 PR 132 us 66 US 24 US 17 US 85 PR 22 FR 9 UK 13 42 28 30 34 US 17 US 12 US 21 US 25 cu 16 cu 8 DN 3 DN 3 4 3 3 3 us 4 US 1 US 2 US 2 38 25 27 31 cu 16 us 10 us 19 US 23 us 14 cu 8 DN 3 DN 3 26,106 31,537 17,139 14,222 us 9,602 us 11,069 US 5,898 US 5,760 IN 2,425 GR 4,363 IN 2,474 IN 2,220 JP 2,398 UK 3,255 UK 1,639 UK 1,517 UK 2,058 IN 2,122 GR 1,251 GR 1,209 4,408 2,040 2,460 1,900 CN 1,409 CN 459 JP 785 JP 441 us 1,209 UK 344 US 673 UK 345 FR 697 CZ 256 FR 192 GR 250 350 327 497 596 GR 113 PH 71 UK 101 GR 115 UK 100 US 62 US 99 UK 103 102 Table 1. — Chilean Imports, by Sections and Commodity Groups, Total and from Principal Suppliers, 1961-64 —continued [Thousands of dollars] Section Group Description 1961 Value/supplier 1962 1963 1964 39 Fabrics 4,525 NE 1,428 US 824 JP 823 40 Bags and packings 3,939 IN 2,400 PK 821 UK 495 41 Trimmings and ribbons 92 US 24 GR 17 JP 14 42 Wearing apparel 11,536 US 6,745 JP 1,449 43 Household wares of textile materials 757 US 223 GR 94 44 Manufactures of textile materials, n.e.s 498 IX Chemicals and related products 45 Chemicals 46 Medicinal drugs, pharmaceuticals and toilet preparations .. 47 Artificial fertilizers 48 Explosives, matches and other pyrotechnical articles 49 Blacking, resins, and industrial fats and oils US 387 GR 34 67,072 US 31,783 GR 11,693 UK 4,699 BL 2,695 17,622 US 8,235 GR 3,301 UK 1,588 SZ 1,019 6,702 US 3,390 GR 1,352 UK 478 IT 336 7,907 US 3,188 BL 2,341 GR 1,790 983 US 555 UK 286 16,861 US 9,268 GR 1,675 PR 1,512 NA 1,435 2,853 US 738 NE 553 JP 508 3,996 IN 2,099 PK 963 UK 539 85 GR 23 US 19 NE 15 7,686 US 4,488 GR 839 597 GR 128 US 107 184 US 132 GR 19 45,475 US 20,989 GR 6,920 BL 3,334 UK 2,774 13,144 US 5,193 GR 2,236 UK 1,463 PR 1,167 4,501 US 2,111 GR 907 UK 304 NE 270 11,969 US 5,238 BL 3,154 GR 2,228 1,394 US 684 UK 533 13,736 US 5,617 NA 2,605 GR 1,539 PR 1,287 50 Industrial alcohols 60 US US 4,204 3,441 us 1,883 US 2,486 NE 1,106 UK 329 GR 351 4,501 GR 208 3,823 IN 2,432 IN 2,170 PK 891 PK 742 UK 748 90 UK 541 110 US 37 US 37 GR 19 GR 25 CN 12 4,239 JP 22 3,555 US 2,357 US 2,367 GR 525 415 GR 478 305 US 131 GR 107 GR 102 732 US 76 493 US 656 US 438 GR 31 96,738 GR 25 78,755 US 36.267 US 32,936 GR 20,208 GR 15,197 UK 6,424 UK 5,800 FR 3,601 26,864 FR 3,003 22,881 US 8,217 US 7,300 GR 5,297 GR 4,457 UK 2,590 UK 2,422 FR 2,380 9,387 FR 2,277 7,408 US 4,255 US 2,769 GR 2,034 GR 1.969 NE 719 NE 837 SZ 555 13,535 UK 514 10,368 US 5,741 US 6,558 GR 3,354 BL 2,298 BL 2,816 1,623 GR 1,130 1,737 US 671 US 904 UK 582 21,205 UK 767 16,664 US 8,319 US 7,113 GR 4,449 GR 3,737 NA 3,332 NA 2.259 UK 893 85 MX 548 116 US 79 US 114 PO - Portugal PR - Pe u SD - Sw eden SG - Singapore SP - Spain SZ — Su itzerlar d UK - United Kingdom UR - Uruguay US — United States VZ — Venezuela Notes: AR — Argentina AU — Australia BL — Belgium BR — Brazil CN — Canada CU — Cuba CY — Ceylon CZ — Czechoslovakia DN — Denmark DR — Dominican Republic EC — Ecuador FM — Malaya, Federation of FN — Finland FR — France GR — Germany, Federal Republic of HG — Hong Kong IN — India IT — Italy JP — Japan MX — Mexico NA — Netherlands Antilles NE — Netherlands NO — Norway NZ — New Zealand PH — Philippines PK — Pakistan PN — Panama 103 Table 1. -Chilean Imports, by Sections and Commodity Groups, Total and from Principal Suppliers, 1961-64 continued [Thousands of dollars] Section Group Description Value/supplier 1962 1963 1964 51 Colors, varnishes, inks and dyestuffs 52 Soaps and candles 53 Other chemical and industrial products X Metallurgical products 54 Iron and steel 55 Other metals, rolled or cast, and their alloys 56 Metal wares for various purposes 57 Wares of iron or steel (including those plated with other metals 58 Wares of other metals XI Machinery and tools 5!) Mining machinery, implements, accessories and tools 60 Agricultural machinery, implements, accessories and tools 61 Machinery, accessories and tools, n.e.s., for industries and trades 5,510 GR 1,882 US 1,598 UK 727 SZ 578 838 US 516 UK 107 10,589 US 4,985 GR 1,575 AR 1,445 UK 783 36,496 US 17,990 GR 8,086 UK 2,375 BL 1,798 11,302 US 6,865 GR 1,833 BL 1,053 UK 388 631 US 269 GR 105 1,232 US 552 GR 367 UK 126 18,868 US 8,774 GR 4,079 UK 1,540 IT 778 4,463 GR 1,702 US 1,531 UK 265 DN 192 132,362 US 65,648 GR 26,182 UK 11,156 IT 5,700 5,985 US 4,785 GR 556 UK 230 SD 218 8,288 US 3,989 UK 1,196 GR 798 CN 762 73,808 US 36,646 GR 17,911 UK 4,646 IT 1,927 3,837 GR 1,487 US 1,076 UK 541 SZ 247 509 US 276 GR 93 10,079 US 5,922 GR 1,218 AR 1,108 UK 652 32,203 US 13,147 GR 7,765 UK 2,154 JP 1,915 8,136 US 3,409 GR 1,857 FR 680 BL 679 576 US 880 GR 52 1,685 US 1,183 GR 278 BL 73 18,851 US 6,867 GR 4,718 UK 1,525 JP 1,316 2,954 US 1,308 GR 860 UK 206 FR 101 121,313 US 59,738 GR 25,412 UK 7.561 FR 6,752 6,074 US 3,189 FR 1,410 GR 784 UK 182 7,976 US 4,426 UK 1,381 CN 808 GR 805 69,383 US 33,947 GR 16,974 UK 3,318 FR 2,397 8,092 GR 2,434 US 2,034 MX 1,061 SZ 1,035 206 US 104 UK 39 15,742 US 6,848 AR 2,736 GR 2,491 UK 1,062 31,477 US 13,280 GR 7,248 UK 2,909 SD 1,129 7,612 US 3,237 GR 1,983 UK 568 BL 434 668 US 358 GR 107 1,203 US 543 GR 417 UK 115 17,883 US 7,518 GR 3,599 UK 1,918 SD 965 4,161 US 1,623 GR 1,142 DN 329 UK 241 152,735 US 70,813 GR 29,065 UK 15,128 FR 7,022 4,718 US 3,088 GR 818 UK 889 SD 228 6,767 US 3,099 UK 1,537 GR 1,044 BL 819 89,937 US 38,911 GR 19,340 UK 7,348 SZ 3,464 6,517 GR 2,381 US 1,516 SZ 811 UK 780 119 US 39 UK 37 12,944 US 6,623 AR 1,710 GR 1,481 UK 768 43,240 US 15,970 GR 10,415 FR 2,815 UK 2,336 9,900 GR 3,729 US 2,736 JP 1,052 FR 935 659 US 343 GR 84 1,261 US 676 GR 301 UK 128 28,246 US 10,668 GR 5,708 AR 2,180 FR 1,770 3,174 US 1,545 GR 592 DN 190 JP 147 157,702 US 74,343 GR 25,620 UK 13,080 FR 7,103 6,439 US 3,965 FR 922 GR 887 SD 298 4,999 US 2,886 UK 1,041 BL 403 CN 151 99,801 US 45,335 GR 16,889 UK 5,250 DN 5,150 104 Table 1. — Chilean Imports, by Sections and Commodity Croups, Total and from Principal Suppliers, 1961-64 continued [Thousands of dollars] Section Group Description 1961 Value/supplier 1962 1963 1964 62 Motive machinery, boilers and spare parts 63 Electric machinery, apparatus and material XII Transport machinery, materials and accessories 64 Railway and tramway equipment and material 65 Watercraft and navigation material 66 Vehicles, n.e.s., and their components and spares XIII Miscellaneous manufactured products 16,242 US 9,490 GR 2,547 UK 1,660 IT 673 28,039 US 10,738 GR 4,371 UK 3,425 IT 2,958 115,129 US 57,991 GR 23,107 JP 10,065 UK 8,605 20,718 US 10,430 JP 8,354 GR 997 UK 580 9,727 GR 5,937 DN 2,695 US 639 84,684 US 46,922 GR 16,174 UK 7,946 FR 4,419 48.736 US 16,186 GR 10,330 JP 3,613 UK 2,684 67 Prepared stones and earths 2,784 CN 1,335 US 530 GR 261 68 Ceramics 5,425 US 2.410 GR 1,201 69 Manufactures of wood 479 SD 263 GR 80 70 Cabinet-maker's wares and other wares of wood or compressed sawdust „ 501 US 185 GR 137 71 Manufactured cork and cork products 62 SP 28 PO 14 13,130 US 7,590 GR 1,932 UK 1,062 SD 978 24,750 US 10,685 GR 5,097 FR 2,610 UK 1,619 85,098 US 41,642 GR 9,818 FR 9,018 UK 7,140 30,750 US 16,039 FR 4,443 JP 4,141 IT 3,926 3,353 PN 1,267 GR 611 PR 609 50,995 US 25,218 GR 8,561 UK 5,915 FR 4,564 38,406 US 11,142 GR 8,598 JP 2,143 SP 2,090 1,725 CN 678 US 421 GR 246 4,142 US 1,564 GR 944 585 SD 239 GR 119 530 US 181 GR 151 18 US 8 SP 7 Notes : AR — Argentina AU — Australia BL — Belgium BR — Brazil CN — Canada CU — Cuba CY — Ceylon CZ — Czechoslovakia DN — Denmark DR — Dominican Republic EC — Ecuador FM — Malaya, Federation of FN — Finland FR — France GR — Germany, Federal Republic of HG — Hong Kong IN — India IT — Italy JP — Japan MX — Mexico NA — Netherlands Antilles NE — Netherlands NO — Norway NZ — New Zealand PH — Philippines PK — Pakistan PN — Panama 22,359 US 13,235 GR 3,518 UK 2,613 FR 893 28,954 US 12,481 GR 4,344 UK 3,289 FR 2,699 74,883 US 31,303 FR 10,074 UK 8,012 GR 7,021 22,752 US 6,711 IT 4,620 JP 4,455 FR 4,121 6,526 DN 3,342 FR 1,483 US 1,237 45,604 US 23,354 UK 6,528 GR 5,722 FR 4,470 54,290 US 14,924 GR 10,348 IT 3,941 UK 3,783 3,003 CN 1,481 US 683 UK 348 4,622 US 1,863 GR 1,156 236 US 126 SD 27 472 US 201 GR 84 US 15 4 SP 4 20.309 US 10,477 UK 4,381 GR 2,632 CN 633 26,154 US 11,680 GR 5,077 FR 2,649 UK 2,307 74,136 US 27,050 FR 16,334 IT 7,125 UK 6,453 15,716 IT 5,766 JP 4,413 US 4,043 GR 603 7,408 FR 2,400 GR 1,874 PR 873 61,013 US 22,329 FR 13,806 UK 5,669 GR 3,571 44,898 US 16,833 GR 6,936 UK 4,462 AR 2,391 2,813 CN 1,003 US 952 UK 409 6,438 US 3,684 GR 1,392 228 US 94 GR 46 337 US 175 GR 59 20 SP 10 US 5 PO — Portugal PR — Peru SD — Sweden SG — Singapore SP — Spain SZ — Switzerland UK — United Kingdom UR — Uruguay US — United States VZ — Venezuela 105 Table 1.- -Chilean Imports, by Sections and Commodity Groups, Total and from Principal Suppliers, 1961-64 continued IThousands of dollars] Section Group Description Value/supplier 1962 1963 1964 72 Manufactures of rubber, celluloid and similar materials ... 73 Tannery products, furs and their derivatives 74 Manufactures of horn, bone and other animal materials, and similar products , 75 Paper and paperboard 76 Printed matter and engravings on paper or paperboard 77 Arms and ammunition 78 Jewelry, gold- or silver-smiths' wares, and timekeeping wares 79 Articles and instruments for the sciences, fine arts, and their applications Works and objects of pure art 81 Various manufactures and products XIV Specie and precious metals 3,510 2,497 2,445 2,653 US 1,545 US 1,003 US 1,036 US 989 GR 717 GR 519 UK 410 JP 506 JP 411 JP 382 GR 409 GR 393 UK 246 UK 164 CN 124 UK 281 847 607 598 835 US 297 US 324 US 394 US 738 IT 239 IT 111 cz 86 cz 33 45 11 4 7 HG 17 HG 4 AR 3 IN 3 4,394 3,105 4,979 4,132 US 1,255 US 841 US 1,197 US 1,107 FN 1,072 FN 687 FN 1,036 FN 880 GR 735 GR 453 UK 908 UK 543 UK 496 UK 452 GR 624 GR 461 5,030 6,786 7,801 5,073 SP 1,676 AR 2,450 AR 2,422 AR 1,482' AR 1,138 SP 1,893 US 1,913 US 1,306 US 813 MX 979 SP 1,482 SP 1,041 MX 750 US 742 MX 1,132 MX 589 673 303 1,877 544 US 359 GR 88 UK 629 IT 291 GR 198 US 80 SZ 385 US 156 1,475 1,162 791 537 sz 591 sz 499 sz 389 SZ 327 GR 539 GR 39S GR 249 GR 111 19,195 13,395 14,799 12,186 us 7,136 GR 4,618 US 5,257 US 4,960 GR 5,237 US 4,566 GR 4,694 GR 3,427 JP 1,725 JP 990 UK 936 AR 685 NE 1,001 IT 521 NE 575 UK 486 15 110 17 20 MX 5 SP 35 GR 6 IT 5 us 4 US 34 US 5 MX 4 GR 2 FR 33 SZ 1 GR 4 4301 3,429 12,632 9,075 us 1,494 US 1,281 IT 3,345 US 2,648 GR 940 GR 740 GR 2,293 UK 2,391 JP 818 JP 433 US 2,019 SZ 772 UK 250 NE 260 sz 1,527 GR 632 50 266 627 21 GR 48 GR 189 us 381 US 8 US 2 PR 58 GR 175 GR 5 US 18 PR 67 IT 5 UK 2 SZ 3 Notes : AR — Argentina AU — Australia BL — Belgium BR — Brazil CN — Canada CU — Cuba CY — Ceylon CZ — Czechoslovakia DN — Denmark DR — Dominican Republic EC — Ecuador FM — Malaya, Federation of FN — Finland FR — France GR — Germany, Federal Republic of HG — Hong Kong IN — India IT — Italy JP — Japan PO — Portugal MX — Mexico PR — Peru NA — Netherlands Antilles SD — Sweden NF, — Netherlands SG — Singapore SP — Spain NO SZ — Switzerland NZ — New Zealand UK — United Kingdom PH — Philippines UR — Uruguay PK — Pakistan US — United States PN — Panama VZ — Venezuela 106 Table 1. — Chilean Imports, by Sections and Commodity Groups, Total and from Principal Suppliers, 1961-64 continued [Thousands of dollars] Section Group Description 1961 Value/supplier 1962 1963 1964 Total 590,514 US 237,700 GR 82,438 55,072 40,609 24,043 20,715 14,638 14,009 9,794 AR UK PR JP IT PR BR NE NA BL DN VZ SD CN SZ SP CY IN PN EC 8,648 7,696 7,539 7,263 7,047 7,042 6,905 5,701 4,196 4,127 3,799 3,067 2,379 511,841 US 194,952 GR 64,309 AR 42,827 UK 32,942 PR 23,983 FR 23,247 JP 14,601 IT 12,626 VZ 10,373 NA 8,293 NE 8,204 BR 7,118 BL 6,972 SD 6,467 DN 6,231 CN 5,452 CU 4,851 SZ 4,699 SP 4,034 PN 3,793 CY 3,675 IN 2,711 637,528 US 223,852 GR 77,427 AR 52,514 UK 46,065 PR 26,518 FR 24,880 BR 18,763 IT 16,659 JP 12,456 MX 11,048 NE 10,873 SZ 10,541 NA 9,408 DN 9,074 CU 8,993 SD 8,258 BL 7,545 CN 7,510 VZ 7,444 EC 7,255 CY 7,168 SP 5,900 607,199 US 222,530 GR 67,251 AR 61,232 UK 41,711 PR 31,782 FR 30,321 MX 16,399 IT 14,269 BR 12,236 JP 11,920 CN 10,573 DN 7,546 NA 7,499 SZ 7,389 VZ 6,116 NE 6,082 SP 5,738 SD 5,399 BL 5,324 NO 3,857 EC 3,805 PN 3,032 Source: Camara de Comercio, Comcrcio Exterior, Chile, 1961,, Santiago, 1965 Notes: Chilean trade statistics no longer include groups 3 and 23. Detail may not add to totals because of rounding. 1961 Table 2. — Trade by Geographic Areas and With Principal Countries [Thousands of dollars] Imports (c i.f.) Area and country 1961 1962 1963 1964 Western Hemisphere: 360,707 311,485 383,405 385,196 United States 237,710 194,979 223,889 222,719 Canada 6,905 5,452 7,510 10,573 19 Latin American Republics: 1 105,410 95,564 131,190 140,671 LAFTA 2 94,476 80,540 120,029 128,890 Argentina 55,072 42,827 52,514 61,232 Brazil 9,794 7,118 18,763 12,236 Ecuador 2,379 2,506 7,255 3,805 Mexico 2,045 2,815 11,048 16,399 Peru 24,043 23,983 26,518 31,782 Venezuela 7,047 10,373 7,444 6,116 Netherlands Antilles 7,696 8,293 9,408 7,499 Western Europe: 195,689 172,685 221,139 197,189 European Economic Community 127,272 115,548 137,384 123,247 Belgium 7,539 6,972 7,545 5,324 France 14,009 23,247 24,880 30,321 Italy 14,638 12,626 16,659 14,269 Netherlands 8,648 8,204 10,873 6,082 Federal Republic of Germany 82,438 64,498 77,427 67,251 Denmark 7,263 6,231 9,074 7,546 Spain 4,196 4,034 5,900 5,738 Sweden 7,042 6,467 8,258 5,399 Switzerland 5,701 4,699 10,541 7,389 United Kingdom 40,609 32,942 46,065 41,711 Eastern Europe 1,409 2,672 3,755 1,982 Asia: 31,803 23,942 26,723 20,328 Ceylon 4,127 3,675 7,168 1,506 Japan 20,715 14,601 12,456 11,920 Other countries 906 1,056 2,506 2,504 Total 590,514 511,840 637,52k-' 607,199 1 Excluding Cuba. - Latin American Free Trade Association; also includes Colombia, Paraguay, and Urug LAFTA until July 12, 1966. 3 Revised estimate shows imports totalled $557 million; however, country distribution on in table includes imports which entered during the two preceding years, according to the Cent Source: Direccion General de Estadistica y Censos, Comercio Exterior, l!)t;i-62, Santi Exterior, 1U63-64, Santiago, 1964-65. 1961-61 Exports (f.o.b.) 1962 1963 1964 231,518 246,707 239,739 273,977 185,790 193,956 184,987 215,742 322 1,091 658 386 41,691 45,307 53,284 56,987 34,812 39,382 49,325 54,493 23,171 14,857 14,475 20,700 6,282 18,513 26,963 23,034 478 454 740 1,172 286 682 1,157 1,837 2,863 3,121 3,708 4,050 1,050 1,368 1,365 1,398 7 13 19 10 246,663 248,452 257,824 291,472 144,240 145,937 145,995 176,040 3,660 7,937 9,990 19,243 10,187 10,487 11,945 17,778 15,861 22,573 24,824 16,508 51,926 44,152 38,343 45.792 62,606 60,787 60,892 76,720 916 981 1,001 1,707 5,237 5,607 7,690 8,846 18,516 20,568 27,739 22,343 181 269 345 107 76,659 74,159 74,320 78,809 1,226 1,638 3,032 1,963 27,114 35,053 12 34,037 40,763 57,250 26,164 39,598 55,836 1,643 232 604 1,070 508,164 532,082 541,962 625,732 nay. Venezuela did not accept membership in the revised basis is not available. Total shown ral Bank of Chile. ago, 1962-63; Camara de Comercio, Comercio 107 Table 3. — United States Exports to Chile by Commodity Sections and Principal Commodity Groups, 1964-65 [Thousands of dollars] Commodity section and commodity group 1964 1965 Food and live animals 22,498 24,293 Milk and cream, dry 2,023 4,191 Butter 1,796 1,564 Wheat, unmilled 13,308 10,546 Rice 1,138 1,103 Meal and flour of wheat or of meslin (including groats) 2,282 2,519 Beverages and tobacco 3,000 2,851 Tobacco, unmanufactured 2,951 2,695 Crude materials, inedible, except fuels 4,997 6,415 Crude rubber, (including synthetic and reclaimed and similar natural gums) 1,935 2,143 Chemical woodpulp, dissolving grades 991 1,155 Mineral fuels, lubricants and related materials 6,339 6,643 Coal 1,756 1,260 Petroleum products 4,574 5,345 Animal and vegetable oils and fats 3,316 3,849 Fixed vegetable oils, soft 2,532 3,703 Chemicals 21,402 27,399 Organic chemicals 1,796 5,527 Medicinal and pharmaceutical products 2,870 3,206 Fertilizers, manufactured 5,668 5,613 Plastic materials, regenerated cellulose and arti- ficial resins 1,976 3,146 Machinery and transport equipment 86,918 119,723 Machinery 69,426 89,279 Industrial machinery 47,755 65,252 Power generating machinery, except electric .... 5,381 9,715 Metalworking machinery 4,380 3,881 Textile and leather machinery 3,919 9,505 Machines for special industries 12,419 17,955 Other 21,656 24,196 Agricultural machinery and implements 5,539 5,861 Office machines _ 1,009 1,157 Electrical machinery, apparatus, and appliances.. 15,122 17,009 Electric power machinery and switchgear 7,719 6,908 Equipment for distributing electricity 1,065 1,057 Telecommunications apparatus 2,010 3,940 Other 4,328 5,104 Transport equipment „ _ _ 17,492 30,444 Railway vehicles _ 2,981 4,106 Road motor vehicles and parts 12,996 21,757 Manufactured goods - _ 26,717 41,424 Articles of rubber 1,963 2,211 Textile yarn and thread 2,474 2,326 Clay construction materials and refractory con- struction materials _ 1,835 3,092 Iron and steel mill products 4,691 11,522 Rails and railway track construction material of iron or steel 1,226 908 Tubes, pipes, and fittings of iron or steel 2,227 4,601 Finished structural parts and structures 1,088 2,588 Hand and machine tools 1,846 2,280 Scientific, medical, optical, (photographic) meas- uring and controlling instruments and apparatus 1,743 2,732 Printed matter 893 1,212 Miscellaneous commodities and transactions 4,834 2,287 Domestic exports, total 180,021 234,884 Reexports 454 423 Exports, total, including reexports 180,475 235,307 Source: Basic data of the U.S. Department of Commerce, Bureau of the Census. Table 4. — Total U.S. Economic Assistance to Chile, Disbursements, Calendar Years 1961-65 [Millions of dollars] Agency 1961 1962 1963 1964 1965 1961-65 Agency for International Development 49.3 Export-Import Bank of Washington 59.7 Food for Peace 1 27.2 Social Progress Trust Fund- Peace Corps Total 136.2 67.2 75.4 76.9 55.3 324.1 21.4 34.6 15.9 26.6 158.2 12.3 19.2 21.2 15.0 94.9 1.9 3.9 6.6 9.5 21.9 .1 .4 .7 2.9 4.1 102.9 133.5 121.3 109.3 603.2 Note: Data shown excludes: Export-Import Bank of Washington debt rescheduling and consolidation credits: U.S. Treasury com- pensatory financing; value of goods delivered under Food for Peace Program (Public Law 480, Title I) which result in generation of local currency for U.S. uses; and U.S. subscription to Inter- American Development Bank. 1 Program for disposal of surplus agricultural products adminis- tered under U.S. Public Law 480. - Fund administered by the Inter-American Development Bank. Does not include technical assistance. Source: Report Prepared ?>?/ the Government of the United States of America for the Inter-American Committee on the Alliance for Progress and the Fourth Meeting of the Inter-American Economic and Social Council, Washington, February 1966. Table 5. — Employment by Economic Sectors, 1960 Activity Number of persons Percentage (thousands) Agriculture, forestry and fisheries .... Mining Manufacturing Construction Electric, gas, water, and sanitary services Commerce, finance, etc Transportation and communications .. Services, including Government Total 701 93 444 140 23 257 117 561 2,336 30 4 19 6 1 11 5 24 100 Source: Corporacion de Fomento de la Produccion, Geografia Economica de Chile, Vol. V, Santiago, 1965. Table 6. — Population by Provinces, 1960 and 1963 (Provinces listed from north to south) Province 1960 1963 Republic, total Tarapaca Antofagasta Atacama Coquimbo Aconcagua Valparaiso Sant ; ago O'Higgins Colchagua Curico Talca Maule Linares Nuble Concepcion Arauco Bio-Bio Malleco Cautin Valdivia Osorno Llanquihue Chiloe Aysen Magallanes Source: El Mercurio, Santiago, February Census, by Direccion de Estadistica y Censos. 7,339,546 8,181,282 122,665 136,546 214,090 238,784 114,277 128,961 306,384 342,820 139,878 155,935 613,405 685,121 2,429,539 2,704,299 259,135 287,878 158,024 175,865 107,160 117,387 205,448 228,727 79,304 88,467 170,278 190,110 284,516 316,910 537,711 598,595 89,211 99,256 167,286 187,189 174,185 193,387 393,041 437,865 255,109 288,241 143,955 159,772 165,959 186,028 98,662 110,072 37,085 41,902 73,037 81,165 21, 1964, based on 1960 108 Table 7. — Estimated Distribution of Personal Income in 1960 Range of Number of persons Total income annual incomes (Thou- (Per- (Thousands of (1960 escudos) sands) cent) 1960 escudos) (Percent) 0— 170 505 15.7 42 1.4 170— 340 515 16.0 129 4.2 340— 800 631 19.9 338 10.9 800— 1,200 807 25.1 778 25.1 1,200— 2,200 341 10.6 458 14.8 2,200— 3,000 226 7.0 476 15.3 3,000— 6,000 150 4.6 563 18.2 6,000—12,000 28 0.9 241 7.8 12,000 or more 6 0.2 72 2.3 Total 3,209 100.0 3,097 100.0 Notes: US$1.00 equalled 1.05 escudos in 1960 at the official ex- change rate. The official minimum living wage (sueldo vital) — legally defined as the wages necessary to meet an employee's indis- pensable needs for living and full maintenance — was 794 escudos in 1960. Source: Corporacion de Fomento de la Produccion, Geogralin Economica de Chile, Vol. V, Santiago, 1965. Table 8. — Gross Domestic Product, Gross National Product, National Income, and Per Capita Income, Selected Years [Millions of escudos] Gross domestic product Gross national product National income Year Total Total Annual percentage increase Total Total Per capita Current prices Constant 1961 prices 1 1940 22 2,676 2,566 2,180 431 1945 54 3,125 3,068 2,695 493 1950 158 3,690 3,621 3,136 520 1955 1,041 4,431 4,363 3,603 532 1960 4,974 5.364 7.3 5,287 4,195 543 1961 5,538 5,538 3.2 5,457 4,480 564 1962 6,699 5,919 6.9 5.821 4,837 592 1963 9,993 6,061 2.4 5,948 5.004 596 1964 15,072 6,207 2.4 6,093 5,110 591 1965 20,399 6,517 5.0 6,398 ( 2 ) (-) 1 US$1. 00=1. 05 escudos in 1961 at the official rate of exchange. 2 Not available. Source: Corporacion de Fomento de la Produccion, Cuentas Nacionales de Chile, 19i0-1962, and 1958-1963, Santiago. June 1963 and 1964. Data for 1964 are estimates prepared by the National Planning Office (ODEPLAN). Table 9. — Gross Domestic Fixed Capital Formation, 1962-64 [Millions of escudos at 1961 market prices] Expenditures 1962 1963 1964 Construction and other works 336 303 323 Buildings 180 154 146 Public works 125 111 145 Other works 31 38 32 Machinery and equipment 410 455 428 Imported 374 419 390 Domestic 36 36 38 Source: Cuentas Nacionales de Chile, 1958-1903, Santiago, June 1964. Data for 1964 are estimates prepared by the National Planning Office (ODEPLAN). Note: US$1 = 1.05 1961 escudos. Table 10. — Gross Domestic Product by Economic Sectors, 1955, 1960, 1964 [Millions of escudos at 1961 market prices] Sector 1955 1960 1964 Agriculture, forestry, and fishing 587 578 623 Fishing 12 12 16 Mining and quarrying 180 228 384 Industrial manufacturing 1,050 1,229 1,195 Construction 106 115 211 Electric, gas, water, and sanitary services 47 63 65 Transportation, storage, and communications .... 264 322 494 Commerce 907 893 1,396 Banking, insurance, and real estate 132 175 173 Rent 309 618 509 Government services 367 481 446 Private services 419 471 639 Adjustment 1 64 22 72 Gross domestic product 2 4,431 2 5,364 6,207 1 Adjustment for variation in the terms of trade. 2 Revised GDP totals: revised data not available for industrial sectors. Source: Corporacion de Fomento de la Produccion, Cuentas Nacionales de Chile, 191,0-1962, and 1958-1963, Santiago, June 1963 and 1964. Data for 1964 are estimates prepared by the National Planning Office (ODEPLAN). Notes: Detail may not add to totals because of rounding. U.S. $1=1. 05 1961 escudos. Table 11. — Gross Domestic Product, bv Expenditures, 1962-64 [Millions of escudos at 1961 market prices] Expenditures 1962 1963 1964 Consumption expenditures 5,223 5,350 5,488 Private sector 1 4,550 4,758 4,930 Public sector 673 592 558 Gross domestic investment 766 758 771 Fixed capital formation 747 758 751 Increase in inventories 19 20 Net imports of goods and services ( — ) — 101 — 124 — 124 Imports of goods and services — 702 — 779 — 801 Adjustments for changes in the terms of trade.. 31 77 72 Gross domestic product 5,919 6,061 6,207 Net payments to foreign factors ( — ) — 98 — 113 — 114 Gross national product 5,821 5,948 6,093 1 Includes government and semi-autonomous enterprises. Source: Corporacion de Fomento de la Produccion, Cuentas Nacionales de Chile, 1958-1963, Santiago, June 1964. Data for 1964 are estimates prepared by the National Planning Office (ODEPLAN). Note: US$1 = 1.05 1961 escudos. Table 12. — Production of Primary Copper, 1961-65 [1,000 metric tons fine copper] Product 1961 1962 1963 1964 1965 Large Mines 481 510 507 528 479 Electrolytic 154 180 179 178 191 Fire refined 62 66 62 78 77 Blister 265 264 267 271 211 Medium and Small Mines 67 76 94 94 103 Fire refined 11 17 18 21 20 Blister 33 31 31 38 55 Cements 1 6 8 12 12 15 Concentrates 1 16 19 29 23 13 Ore 1 1 1 3 2 2 Other 1 - - Total 547 586 601 622 583 1 Based on shipments. 2 Less than 500 metric tons. Source: Departamento del Cobre, Estadistica Chilena; Cobrc Primario, Santiago, December 1964 and 1965. Note: Detail may not add to totals because of rounding. 109 Table 13. — Production of Principal Agricultural and Animal Products, 1955 and 1964-65 [Thousands of metric tons] Table 16. — Production of Selected Products, 1959 and 1963-65 Product 1955 1964 1965 Wheat 1,093 Oats Barley Corn Rice, rough Sugar beets Potatoes Beans, dry Chickpeas Lentils Onions Sunflower seed Beef (carcass weight) ... Pork (carcass weight) ... Mutton (carcass weight) Milk Flaxseed Rapeseed Tobacco Wool ,093 1,319 1,246 130 133 120 100 139 135 117 205 203 91 86 82 47 737 845 727 774 674 78 95 82 4 6 7 18 21 17 91 104 100 40 45 50 122 131 110 47 40 40 29 25 25 770 1,133 998 3 4 3 0.2 51 74 6 5 5 22 25 26 Source: U.S. Department of Agriculture, Economic Research Service, Indices of Agricidtural Production for the 20 Latin Ameri- can Countries, revised 1954-64 and preliminary 1965, ERS-Foreign 44, January 1966. Note: Available estimates for 1966: wheat, 1,150: oats, 130: barley, 131; and corn, 205 thousand metric tons. Table 14. — Production of Principal Minerals, 1963-65 Mineral 1963 1964 1965 Copper m.t. fine 601 621 1 583 Iron ore 1,000 m.t 8,510 9,853 12,721 Nitrates 1,000 gross m.t 1,136 1,172 1,158 Iodine net m.t 2,158 2,161 2,281 Gold kilogram fine 1,642 2,041 2,296 Silver m.t. fine 73 92 102 Calcium carbonate 1,000 m.t 1,712 1,772 1,751 Molybdenum m.t. fine 2,907 3,855 3,603 Lead -do- 1,150 1,102 1,269 Zinc -do- 481 963 1,296 Mercury -do- 21 10 13 Manganese gross m.t 46 20 16 Petroleum 1,000 cubic meters 2,100 2,176 2,020 Gas 1,000,000 cubic meters 5,155 6,301 6,215 Coal 1,000 net m.t 1,604 1,677 1,626 1 Provisional. Source: Banco Central de Chile, Boletin Mensual No. 1,50, Santi- ago, May 1966. Note: Abbreviations: m.t. fine=metric ton of fine metal; m.t.^metric ton; gross m.t. = gross metric ton; 1,000 net m.t. = 1,000 net metric tons. Table 15. — Production of Principal Petroleum Products by the Concon Refinery, 1956 and 1962-65 [Thousands of cubic meters] Product 1956 1962 1963 1964 1965 Automotive gasoline Aviation gasoline Kerosene Diesel oil Fuel oil Liquid gas Solvents 2 467 923 889 947 990 70 59 66 51 25 253 290 301 294 189 383 404 469 464 270 636 613 647 a 599 2 65 68 74 86 1 14 16 21 ( 3 ) 1 Data for 1965 apparently does not include residual fuel oils. 2 Mostly turpentine and white gas. 3 Not available. Source: Empresa Nacional del Petroleo, Memoria Anual 1961,, 1965 and Boletin Estadisticas Resumen Anual, 101,5-19113, Vol. 22, Santiago, 1964. Banco Central de Chile, Boletin Mensual No. 1,56, Santiago, February 1966. 110 Product 1959 1963 1964 1965 Sugar 1,000 m.t 203 265 245 229 Pasta 1 -do- 38 51 55 54 Beer 100,000 liters 112 123 107 165 Cigarettes millions 5,564 6,315 6,437 6,665 Paper 1,000 m.t 91 125 129 130 Tires 1,000 units 224 371 478 506 Innertubes -do- 175 294 349 355 Rayon yarn 1,000 m.t 2 2 2 Rayon fiber -do- 2 3 3 Matches 1,000 cases 186 245 226 248 Flat glass 100,000 sq.m 1,670 2,071 834 2,648 Cement 1.000 m.t 833 1,169 1,267 1,188 1 Represents about 90 percent of production. Source: Banco Central de Chile, Boletin Mensual No. 1,59, Santi- ago, May 1966. Note: Abbreviations: m.t. = metric tons: sq.m. = square meters. The term "unit" means one item. Table 17. — Indexes of Industrial Production, 1957 and 1963-65 [1953 = 100] 1957 1963 1964 1965 1 Food products 103.3 127.1 132.0 135.3 Dairy products 122.6 158.4 165.9 150.0 Preserved fruits and vegetables 122.9 205.3 216.6 248.0 Preserved fish and shellfish 85.5 137.5 177.5 143.8 Milled grain products 113.0 92.2 99.0 103.3 Sugar production and refining 88.7 137.7 127.7 119.2 Miscellaneous food products 109.6 144.6 151.7 157.3 Beverages 115.8 156.5 145.0 181.3 Spirits 68.2 147.2 145.7 149.9 Beer and carbonated beverages 131.7 161.7 146.4 194.6 Tobacco products 85.9 120.8 128.1 138.0 Textiles 92.5 127.1 131.7 137.3 Yarn, fabric and finished textiles 88.8 106.4 106.8 110.7 Knitwear 120.3 263.4 295.1 314.9 Clothing and shoes 115.8 157.4 154.9 165.5 Shoes, not of rubber 134.1 169.5 161.0 172.5 Ready-made clothing 96.7 149.5 153.3 163.3 Furniture and household goods 76.3 98.0 108.8 119.3 Paper and paper products 118.1 236.0 235.6 261.4 Printing and publishing 90.7 113.0 115.0 128.1 Leather and leather goods 102.7 95.9 99.2 107.8 Rubber products 92.8 164.8 202.6 209.9 Chemicals and chemical products 111.7 135.8 133.5 132.2 Basic chemicals and fertilizers 114.3 149.3 129.8 136.7 Miscellaneous chemical products 113.5 132.5 136.3 134.6 Petroleum and coal derivatives 99.9 207.0 222.6 221.4 Nonmetallie mineral products 91.5 158.3 147.1 146.7 Glass and glass products 64.8 144.4 103.9 120.7 Ceramics, porcelain and pottery 125.6 210.1 205.0 183.6 Cement and asbestos, and their products 97.9 153.3 158.7 151.8 Basic metals 115.2 174.3 216.3 219.2 Basic iron and steel 122.2 185.0 197.2 184.0 Nonferrous metals 83.6 125.4 303.5 379.6 Metal products (excluding transport machinery and equipment 117.6 271.5 290.1 307.3 Machinery, apparatus and accessories (including electrical) 112.0 169.5 174.9 189.2 Miscellaneous manufactures 114.0 179.4 201.6 259.x General Index 102.7 148.9 156.9 163.7 1 Provisional. Source: Banco Central de Chile, Boletin Mensual No. 1,59, Santi- ago, May 1966. Table 18. — CAP Shipments of Iron and Steel Products to the Domestic Market, 1962-64 [Thousands of metric tons] Year Product 1962 1963 1964 152.7 165.0 61.2 65.3 11.9 6.5 7.9 8.2 15.2 23.0 5.1 2.9 5.3 3.8 3.6 4.4 42.5 50.9 163.3 191.6 26.9 33.6 3.1 4.9 11.8 12.3 2.3 2.8 24.3 33.0 31.9 39.0 26.2 32.1 29.9 26.8 0.4 0.3 6.5 6.8 10.3 13.4 9.1 9.1 6.1 4.5 2.8 4.4 0.2 0.2 9.1 10.1 344.5 389.2 Merchant, total 157.3 Round and square bars under 2 inches : Reinforced concrete bars 67.7 Others 10.4 Grinding bars over 2 inches 6.5 Bars for grinding balls 19.7 Flat bars 4.2 Angles and light shapes 6.2 Railroad shapes 5.3 Wire rod 37.3 Flat Products, total 146.0 Plates 24.7 Coil plates 3.3 Hot rolled sheets 13.7 Galvanized sheet over 2 mm 1.5 Coils over 2 mm 22.4 Galvanized sheet 24.5 Cold rolled sheets 24.8 Tinplate 26.2 Black plate 0.3 Coils under 2 mm 4.6 Semifinished and finished products, total 11.5 Other products, total 8.7 Pipe under 300 mm 2.5 Pipe over 300 mm 5.7 Culverts 0.5 Pig iron, total 5.5 Iron and steel, total 329.0 Source: Compania de Acero del Pacifico, S.A. (CAP). Table 19. — Chilean Imports of Iron and Steel, 1962-64 [Thousands of metric tons] Year Import 1962 1963 1964 Merchant, total 10.0 10.4 7.8 Round and square bars 3.5 3.7 l.S Grinding bars 1.4 1.4 1.4 Flat bars .4 .4 .1 Angles and light shapes .6 .5 .2 Wire and wire rod 2.8 2.9 3.5 Other bars 1.3 1.5 .g Flat products, total 12.6 11.8 4.8 Plate 5 1.8 .4 Strip steel over 200 mm .4 .3 .2 Sheet (hot and cold rolled) 1 4.1 5.4 1.6 Galvanized sheet 3.2 1.7 .9 Tinplate 3.3 .7 .1 Other 1.1 1.9 1.6 Other products, 2 total 30.4 18.7 57.7 Welded and seamless pipe 23.2 8.9 40.9 Structures, shapes, tanks 3.5 8.1 16.3 Grinding balls 2.7 .4 Miscellaneous .3 .5 .1 Ferroalloys .7 .8 .4 Pig iron, total Iron and steel, total 53.0 40.9 70.3 Source: Superintendencia de Aduanas. 1 Customs data does not differentiate between hot and cold rolled sheets. - This compilation of imports excludes manufactured iron and steel products such as rails, accessories and other transportation and agricultural items. Table 20. — Consumption of Electricity by Category of Consumer, Various Years [Millions of kilowatt hours] Consumer 1950 1955 1960 1964 Residences 281 391 473 636 Commerce 91 137 185 266 Rural 8 40 80 101 Industry and Mining, total 1 2,176 2,662 3,038 3,845 Sugar 8 15 30 43 Cement 104 127 128 181 Paper 113 125 256 388 Chemicals 56 101 95 114 Metallurgy 47 123 152 210 Coal 51 66 SO 93 Copper 1,077 1,217 1.3x0 1,591 Iron 2 13 8 24 36 Petroleum 15 32 55 Nitrate 293 346 302 377 Others 415 521 559 758 Public lighting 38 58 83 107 Transport 120 132 128 124 Central and local government 70 132 170 216 By electric producers 23 38 45 50 Lost 136 276 390 576 Consumption, total 2,943 3,866 4,592 5,928 1 Industrial consumption totaled 466, 724, 949 and 1,425 million kilowatt-hours in 1950, 1955, 1960, and 1964, respectively. - Estimated. Source: Empresa Nacional de Electricidad, S.A. (ENDESA), Production y Consumo de Energia en Chile: 196b, Santiago, 1965. Note: Detail may not add to totals because of rounding. Some figures are approximations. Table 21. — Average Exchange Rates, 1956-65 [Chilean escudos per US$1] Bankers spot Brokers spot 1956 453 .534 1957 621 .694 1958 793 1.000 1959 1.047 1.055 1960 1.051 1.051 1961 1.051 1.051 1962 1.142 1.751 1963 1.875 3.011 1964 2.373 3.204 1965 3.131 3.739 Source: Banco Central de Chile, Boletin Mensual No. .',59, Santi- ago, May 1966. Note: Data for 1956-59 originally in pesos. Table 22. — Annual Percentage Increase in Consumer Prices for Santiago Alone and Wholesale Prices in Chile, 1960-65 Percentage increase Percentage increase consumer prices wholesale prices in Santiago alone in Chile Year Domestic Imports Total 1960 5.4 2.5 —0.4 1.6 1961 9.7 1.8 1.2 1.6 1962 27.7 29.5 21.1 26.8 1963 45.4 40.5 56.6 45.4 1964 38.4 44.0 43.1 43.7 1965 25.9 32.7 7.8 24.5 Source: Banco Central de Chile, Bolctin Mensual No. 459, Santi- ago, May 1966 and various previous issues. Note: Percentages represent the change in the price index from December of the preceding year to December of the year shown. Ill Table 23. — Balance of Payments, 1962-65 [Millions of dollars] Item 1962 1963 19651 Current account Merchandise Exports Imports _ Nonmonetary gold Merchandise services Transport and communications.. Commercial services _ Insurance Non-commercial transactions .... Servicing of capital Private Official Public sector transactions (net) .. Private transactions (net) Tourism and travel costs Donations Official Private Capital account Private Long term Medium term Short term Official Long term Medium term Short term Financing Central Bank Assets Liabilities Commercial banks Assets Liabilities Other institutions Net errors and omissions _.. -202.1 — 198.8 —132.6 —74.5 -112.0 —91.3 —33.1 54.8 490.9 494.4 590.4 665.9 -602.9 —585.7 —623.5 —611.1 .0 3.0 1.9 4.5 ■1.6 ,2 6.6 —7.9 7.0 —5.5 9.0 ( 2 ) —1.1 —2.1 —1.7 ( 2 ) —.7 —.9 —.6 n —.6 8.3 —.1 ( = ) —90.2 —90.0 —103.4 —134.8 —70.9 —67.6 —80.7 —73.6 —19.3 —22.4 —22.7 —61.2 —3.1 .7 —5.8 —6.0 —13.9 —25.5 —6.6 —9.9 —7.0 —20.4 —2.6 (-") 12.5 4.5 7.8 9.0 8.5 .4 .2 .2 4.0 4.1 7.6 8.8 111.3 106.5 151.2 134.0 13.6 —48.9 8.9 ( 2 ) 33.1 —26.0 7.4 ( 2 ) 37.9 8.8 9.8 ( 2 ) —57.4 —31.7 —8.3 ( 2 ) 97.7 155.4 142.3 ( 2 ) 98.3 127.7 129.7 ( 2 ) —5.5 11.8 16.3 ( 2 ) 4.9 15.9 —3.7 ( 2 ) 73.7 27.1 —22.7 —59.5 19.8 29.6 —20.5 —40.0 —4.9 2.0 —11.9 —48.6 24.7 27.6 —8.6 8.6 49.2 .0 —4.8 —15.6 6.9 —7.6 —.1 .5 42.3 7.6 —4.7 —16.1 4.7 —2.5 2.4 —3.9 17.1 65.2 4.1 ( 2 ) 1 Estimated. 2 Not available. Source: Banco Central de Chile, Boletin Mensual No. 459, Santi- ago, May 1966. Table 25. — Total Value and Volume of Imports and Exports, by Ports of Entry, 1964 [Value in millions of dollars and weight in thousands of metric tons] Imports Exports Port of Entry Value Weight Value Weight Antofagasta 41 315 200 289 Arica 29 76 5 46 Caldera 28 1,578 Castro 3 3 * 1 Chacalluta 1 1 Chanaral 9 123 69 1,300 Coquimbo 13 31 21 2,579 Coyhaique 1114 Crus Grande 5 646 Huasco 27 3,147 Iquique 22 94 15 183 Lonquimay '10 Los Andes 25 60 1 3 Los Vilos 1 68 Puerto Aysen 1117 Puerto Montt 4 23 » 3 Punta Arenas 38 63 10 71 San Antonio 31 261 148 276 Santiago 31 7 2 2 Talcahuano 73 744 9 78 Taltal 17 Tocopilla 15 508 33 854 Valdivia 4 28 1 16 Valparaiso 267 843 39 144 Others 1 4 8 70 Total 609 3,186 626 11,313 1 Equals less than $500,000 or less than 500 metric tons. Source: Banco Central de Chile, Boletin Mensual No. H7, Santi- ago, May 1965. Note: Detail may not add to totals because of rounding. Table 24. — Exports of Principal Commodities, Total and to the United States, 1962-64 [Thousands of dollars] Commodity 1962 Copper ore, concentrates, precipitates and cement 9,372 Copper, electrolytic, standard or blister and refined ingots 214,981 Copper blister bars with gold and platinum 126,565 Copper bars and sheets 126 Molybdenum concentrates 9,904 Iron ore 56,240 Nitrate 30,350 Iodine 3,624 Wool 5,794 Rice 2,707 Beans 3,244 Lentils 2,926 Onions 1,873 Fruits, fresh 4,597 Fishmeal 7,073 Fish oil 1,042 Cellulose 3,073 Iron and steel sheets, plain 1,612 Copper wire, uninsulated 2,250 Paper for newspapers, magazines, and books 3,440 Other commodities 41,289 Total 532,082 1 Less than $500. Source: Direccion de Estadistica y Censos, Comercio Exterior, Chile, Chile, 196S-1964, Santiago, 1964-65. 112 Total 1963 1962 To United States 1963 1964 12,203 12,274 800 276 210,630 211,073 32,058 20,860 30,758 132,906 149,909 107,053 116,866 125,046 131 16,779 7,302 11,680 14,740 57,194 69,585 26,004 20,537 21,839 30,134 29,748 14,618 13,771 11,906 2,792 3,148 1,642 1,525 1,317 8,364 7,186 221 254 144 10 2,657 3,722 154 2,666 3.359 1,984 1,106 515 87 191 5,616 5.855 2,807 2,529 3,021 9,230 15,904 1,111 2,124 1,424 1,292 2,074 1,907 1,583 t 1 ) 1 3,433 1,737 f 1 ) 1,595 18,622 4,224 3,872 4,995 41,666 52,333 7,927 5,634 8,139 541,962 625,732 193,956 184,987 215,742 1962, Santiago, 1963: Camara de Comercio, Comercio Exterior, PE fN I STATE UNIVERSITY LIBRARIES For use of Supt. Docs. ORDER FORM To: Superintendent of Documents, Government Printing Office, Washington, D.C. 20402 or Any U.S. Department of Commerce Field Office Please send me the market studies checked. Enclosed find $ (check or money order). Name Address City, State, & Zip Code D AFRICA: Sales Frontier for U.S. Business. 1963. 121 pp. $1. □ BELGIUM, A Market for U.S. Products. 1963. 60 pp. 45*. □ TRADE and INVEST in CENTRAL AMERICA. 1965. 60*. □ EAST AFRICA. Market for U.S. Products. 1966. 16 pp. □ HONG KONG, A Market for U.S. Products. 1964. 122 pp. $1 □ IRAN, A Market for U.S. Products. 1966. 87 pp. 50*. □ IVORY COAST, A Market for U.S. Products. 1966. 87 pp. 65*. □ LIBERIA, A Market for U.S. Products. 1965. 40 pp. 35*. □ MEXICO, A Market for U.S. Products. 1966. 65 pp. 50*. □ NIGERIA, A Market for U.S. Products. 1964. 72 pp. 50*. □ PERU, Market for U.S. Products. 1961. 62 pp. 40*. D PHILIPPINES, A Market for U.S. Products. 1965. 76 pp. 55*. □ SAUDI ARABIA, Market for U.S. Products. '62. 44 pp. 40*. □ SUDAN, A Market for U.S. Products. 1962. 47 pp. 40*. □ THAILAND, Market for U.S. Products. 1962. 92 pp. 55*. □ VENEZUELA, A Market for U.S. Products. 1964. 65 pp. 50*.