Category: Chile

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.

Chile’s state-owned copper company Codelco plans to sign the first of a series of agreements worth up to $2 billion with Chinese state metals company Minmetals in the next few days. Codelco will repay Minmetal in copper. Codelco, the world’s largest copper producer, has several projects in the pipeline including the $900 million Alejandro Hales mine and the $500 million-$600 million Gaby mine, both in northern Chile.

Former foreign minister Soledad Alvear dropped out of Chile’s presidential contest and threw her weight behind Michelle Bachelet, the former defense minister and current frontrunner. Both women are from the center-left Concertacion coalition, which has governed Chile since the country’s return to democracy in 1990. Bachelet now faces ex-mayor of Santiago Joaquin Lavin and businessman Sebastian Pinera, who are vying to be the conservative Alianza por Chile’s presidential nominee. The election will be in December.

Chile, the world’s largest copper producer, passed a bill that will increase taxes on mining companies by as much as 5 percent. The new tax will make mining in Chile costlier for companies such as BHB Billiton and Phelps Dodge, the world’s second-biggest copper producer. The government estimated last year that the tax would boost its revenue by about $145 million annually at prices of 90 cents a pound. Copper prices have jumped to $1.37 a pound, largely on increased demand from China.

Chile’s copper exports rose to $1.34 billion in April, up 6 percent year-on-year. The central bank said that dwindling supplies and higher demand pushed copper prices to a 16-year high. Chile, which produces a third of the world’s copper supply, has benefited from a surge in demand spurred by economic expansion in China, the world’s biggest copper consumer.