Chile’s best-known exports are natural and agricultural, such as the grapes and apples often seen on grocery shelves in Canada.
But the changing global economy is presenting a new and promising opportunity for an export that is far less tangible: digital services. This sector has become a “very strong” industry for the South American nation, Chile’s Minister of Finance Mario Marcel said at a recent Toronto conference.
“If we keep growing at the pace that we are having in digital services, in a matter of a few years, exports of digital services from Chile will be similar to the fruit exports that we have today,” he said.
Marcel’s comments came during the Chile Day event, a conference held in Toronto and New York focused on highlighting the country and connecting investors, authorities and other stakeholders.
Marcel was among several Chilean officials and politicians, including Chile’s central bank governor Rosanna Costa, in attendance to showcase the country’s economic progress and potential.
Scotiabank sponsored the three-day event held in late May, marking the second time it was held in Canada.
The Bank is the third largest in Chile, where Scotiabank has had a significant presence since 1990. The Bank now has roughly 6,000 employees in the country, which is a core part of the organization’s strategic path unveiled at its recent Investor Day, said Scott Thomson, Scotiabank’s President and Chief Executive Officer.
“Chile plays a really important role in that strategic agenda,” he said during his opening remarks at the event.
For example, in 2022, Scotiabank Chile was named Digital Bank of the Year for Latin America and the Caribbean by LatinFinance magazine, Thomson noted.
“Chile is leading the way from a digital perspective…. A huge step forward in terms of how we think about interactions on mobile and how we think about reducing costs, improving customer experience and being more competitive,” he added. “And increasingly, you're seeing our Canadian colleagues go down to Chile to learn from what we're doing there.”
Chile’s finance minister said the country has several competitive advantages for digital services development, including high-quality optical fiber connectivity and fast upload and download speeds. These are key elements for data centres. Chile has 22 operational data centres and 28 more are expected across the country, he added.
Photo: Chile’s Finance Minister Mario Marcel participates in Chile Day, a two-day event showcasing the country’s potential and connecting investors and other stakeholders.
Credit: Scott Ramsay
Marcel also outlined Chile’s progress on other fronts during his wide-ranging presentation.
The country’s economy is growing again after contracting in the second quarter of last year, he added. It has been growing at a monthly rate of 0.3% between June 2023 and March 2024, amounting to an annualized growth rate of around 3.6%, he noted. As well, inflation in Chile has come down to 3.5% so far from a whopping 14% in 2022, said Marcel.
“Certainly, Chile is back where it was prior to all of the events that we have endured over the last four years.”
As well, private investment plans for 2024-2027 grew by nearly US$20 billion in the last year, with a significant rise expected for 2025.
“Investment not only did not collapse, but actually became better than in previous economic cycles,” he said.
Chile is also benefitting from rebounding prices for copper and expects to ramp up production of the valuable metal, said Marcel. The country is the world’s top copper producer with roughly 24% of global copper production.
Demand for copper is surging because of its use in renewable energies and electric vehicles as part of the green transition.
“By 2030, Chile will be the country with the largest increase in copper production,” he said.
Chile is also a top producer of lithium, a critical mineral also used in electric car batteries.
Marcel said that Chile’s production of lithium will increase by 76% by 2030 and by more than 100% by 2035, a move that will return Chile to the leading position of production of the mineral in the world.
“The world economy is greening and digitalizing, and this is opening up new competitive advantages for Chile … these will be the drivers of future growth.”