Category: Chile

Chilean pulp and paper manufacturer CMPC sold bonds worth $208 million on the local market. The bonds will mature in 10 years and bear an interest rate of 3.22 percent. The family of company chairman Eliodoro Matte owns about 56 percent of CMPC.

A 7.9 magnitude earthquake struck northern Chile Monday night, killing eight people. The quake temporarily knocked out power at BHP Billiton’s Cerro Colorado copper mine, though operations continued running normally at Escondida, the world’s largest copper mine. Power was cut at Codelco’s largest mine, Chuquicamata, and at Radomiro Tomic mine, though operations were quickly restored.

Organization of American States foreign ministers rejected a proposal by the United States to monitor democracy in the region, seen as a veiled threat to Venezuela. A majority supported a Chilean compromise involving member states working together to evaluate internal developments in OAS countries, while respecting members’ sovereignty.

Chile posted a trade surplus of $543 million in May, down from $1.02 billion a year earlier as rising consumer confidence led to surging sales of imported cars and electronics. Consumers have boosted spending after the economy expanded in 2004 at its fastest pace in seven years, pushing down the unemployment rate to 8.2 percent in April from 8.7 percent a year earlier. Imports in May rose 36 percent year-on-year to $2.52 billion, while exports rose 7 percent to $3.06 billion.

A Chilean court stripped former dictator Augusto Pinochet of presidential immunity as it looks into allegations he stashed millions of dollars in foreign bank accounts. Pinochet and his family had at least $15 million hidden in dozens of accounts overseas at various banks, a US Senate subcommittee said in March. Riggs Bank in Washington DC was fined $16 million by a US federal judge for helping Pinochet and the leaders of Equatorial Guinea set up secret accounts.

Chile’s economy expanded 6.3 percent year-on-year in April, its fastest pace this year, as manufacturers boosted production to meet a jump in orders. Business for manufacturers and retailers strengthened and employment rose, while trade also grew following a surge in demand for copper, Chile’s top export. Prices for the metal rose to their highest level in 16 years in April and have kept rising this month. Chile, the world’s biggest copper exporter, accounts for about a third of world production of the metal.

Chile signed free trade agreements with Brunei, New Zealand and Singapore last week, and formed the so-called Pacific Four Strategic Economic Partnership (P-4). All Chilean exports to Singapore will be free from taxes and over ninety percent of Chilean exports to New Zealand will be duty free. Chile is retaining some restrictions on imports but most of those will be phased out over the next ten years.

Executives of Chilean retailer Centros Comerciales Sudamericanos (Cencosud) will travel to New York in the next week to negotiate a syndicated loan of $700 million from a group of banks led by Spanish BBVA. Cencosud is looking to restructure liabilities of $1.0 billion, including those of the department store chain Almacenes Paris, purchased in March. The company owes $300 million in short-term debt payments.

Chile’s economy grew 5.7 percent year-on-year in the first quarter, boosted by copper exports. Machinery and equipment investments grew 45 percent and the construction sector expanded 14 percent. Internal demand has increased 11 percent in the last twelve months.

Chinese state-owned Minmetals will provide Chile’s copper company Codelco with $500 million as part of a long term contract for copper. Further discussions could increase that figure to $2 billion. Codelco is benefiting from strong copper demand from China and is looking to ramp up production in Chile over the next five years.