Market Access Plan 2015-2017

CapitalPopulationTotal AreaCurrency
Santiago17.4 million756,096 km²Peso

Why Chile Matters

Chile is:

  • a priority emerging market under Canada’s Global Markets Action Plan;
  • Canada’s top direct investment destination in South and Central America, and seventh worldwide;
  • the most competitive country in South America according to the World Economic Forum's Global Competitiveness Report for 2014-2015; and
  • a strong proponent of regional integration efforts, including as a founding member of the Trans-Pacific Partnership and the Pacific Alliance.

The Canada-Chile commercial relationship is diverse and growing. The cornerstone of this relationship is the Canada-Chile Free Trade Agreement (CCFTA), which entered into force in 1997. Since then, bilateral merchandise trade has more than tripled, growing to $2.86 billion in 2014. In May 2013, a study by Foreign Affairs and International Trade (now Foreign Affairs, Trade and Development Canada) on the effects of the CCFTA confirmed that bilateral trade flows between the two countries grew 12 percent faster than would have been the case in the absence of the CCFTA.

Given the importance of the CCFTA to our trade and investment relationship, Canada and Chile have worked together to expand and modernize the agreement to ensure that it remains relevant and in line with our most recent respective free trade agreements. On April 10 2015, the Honourable Rob Nicholson and Heraldo Muñoz, Chile’s Minister of Foreign Affairs announced conclusion of negotiations to modernize the Canada- Chile Free Trade Agreement.  The modernized agreement contains a new chapter on sanitary and phytosanitary measures, and technical amendments to the existing government procurement chapter.  In addition, both countries agreed to bring amendments to the CCFTA rules of origin into force as soon as possible.

The Canada-Chile Partnership Framework, signed in 2007 and subsequently renewed and elevated to a Strategic Partnership in May 2013, is complemented by multiple other agreements and serves as a roadmap for the expansion and deepening of collaboration between Canada and Chile in various priority sectors, such as sustainable development of minerals and metals, energy, science and technology, and investment promotion.

Canada and Chile work closely together in a number of areas of mutual interest, including governance and transparency, social inclusion for vulnerable and minority groups, and the sharing best practices between Canadian and Chilean indigenous communities. Canada’s enhanced engagement with Chile since 2007 has been further strengthened by exchanges of high-level visits, including two visits by Prime Minister Stephen Harper to Chile (2007, 2012); visits by President Michelle Bachelet (2008) and President Sebastian Piñera (2013) to Canada; and a state visit by Canada’s Governor General David Johnston in December 2014.

In November 2014, the Government of Canada lifted the visa requirement for Chile, allowing Chilean visitors and businesspeople to stay in Canada visa-free for up to six months. The visa exemption will further deepen Canada-Chile relations and lead to increased tourism, as well as increased trade and economic opportunities. 

Domestic Economic Environment

Chile’s economy is market-oriented and has a high level of foreign trade. In addition, Chile has been a strong proponent for regional integration efforts, being a founding member of both the Pacific Alliance and Trans-Pacific Partnership (TPP).

Chile has a sound and stable macroeconomic framework and a strong public balance sheet. It has a reputation for strong financial institutions, which, together with its macroeconomic stability, has meant that it has one of the highest sovereign bond ratings among emerging markets. Chile joined the Organisation of Economic Co-operation and Development in 2010.

Chile’s GDP per capita, is US$15,995 and their economy fared better than most in the last global economic downturn. GDP contraction in 2009 was only 1.0 percent and was followed by an average growth rate of 5.2 percent between 2010 and 2013. This strong performance was due in large part to Chile’s sound banking system and a large economic stimulus package made possible by astute financial planning during the resource boom that saw high copper prices in the years prior to the crisis. While Chile’s economic growth moderated in 2013 to 4.2 percent and slowed in 2014 to 1.9 percent, its stable economy and pro-market orientation continue to make Chile an attractive investment destination.

Key Figures – Chile (2014)
GDP$285.0 billion
GDP per capita$15,995
GDP growth1.8%
Canada’s merchandise exports$1,135.9 million
Canada’s merchandise imports$1,724.3 million
Canada’s service exports (2013)$238 million
Canada’s service imports (2013)$123 million
Foreign direct investment from Chile into Canada (2013)US$446 million (IMF)
Canadian direct investment in Chile$18,331 million
Potential long-term annual export growth4.5%

Canadian Commercial Interests in Chile


In 2014, Canada’s merchandise exports to Chile surpassed $1 billion for the first time. Exports consisted mainly of mineral fuels and oils, machinery, cereals, fats and oils, and aircraft and aircraft parts. Imports totalled $1.72 billion, and consisted primarily of copper, fruits, precious stones and metals, fish and seafood, and beverages.

At the end of 2014, the stock of Canadian direct investment in Chile stood at more than $18.3 billion, making Chile Canada’s top direct investment destination in South and Central America and seventh worldwide. Canada has been one of the largest sources of new foreign direct investment in Chile over the last decade (2003-2012 most recent figures available) with Canadian investors present mainly in mining, utilities, chemicals, transportation and storage services, and financial services. This high level of investment, supported by the double taxation agreement in place since 2000, gives Canada an excellent profile and opens the door to value chain opportunities.

In May 2015, the Santiago Stock Exchange (BCS), in partnership with the Toronto Stock Exchange (TSX), announced the launch of the Santiago Stock Exchange Venture (SSEV). The SSEV, a new public venture capital market for small and early-stage companies, allows companies that issue securities on the TSX to dual list on the new venture exchange in Chile.

Key Elements for Exporters to Consider

Chile views foreign direct investment (FDI) as key to sustaining its impressive economic growth over the last 30 years. Its laws and regulations encourage investment with few restrictions placed on FDI.

An array of recent Chilean legislative reforms, including in education and labour, are causing some uncertainty in a number of sectors. For example, in September 2014, Chile's congress approved a tax reform bill aimed at increasing tax revenues and expenditures in social reforms, particularly in education. While the principal elements of the tax reform are expected to be implemented starting in 2017, the proposed system, which combines two taxation collection methods, is complex and proving difficult to implement. There is an expectation that a significant revision of the reform will be announced in due course. In the meantime, Canadian investors would be well advised to acquire good accounting and legal services to navigate the existing system and prepare for future changes. As well, the level of complexity and procedural delays in obtaining permits in extractive sectors has increased due to ongoing environmental and community consultation processes. Aware of the weight of the regulatory regime, the Chilean government has established a commission to review the environmental assessment process in an effort to address delays and to clarify its regulatory framework.

Lower metal prices have contributed to an overall slowing of growth and investment in Chile, as well as a subsequent devaluation of the Chilean peso; however, despite the recent deceleration in the Chilean economy, Canadian investment in Chile continues to grow, particularly in the mining and infrastructure sectors. Nevertheless, Canadian companies face growing competition in these sectors from other advanced economies. Canadian companies entering the Chilean market will need to continue to differentiate themselves in order to take advantage of opportunities.

Chile imposes no currency restrictions. Letters of credit are the most common instrument for import transactions, although many exporters will offer special terms when dealing with a known Chile-based client (local or international) that has a good track record and credit rating. The U.S. dollar is the currency used for most import transactions.

In 2015, Chile ranked 41 out of 189 on the World Bank’s Ease of Doing Business Index.

Sector-specific Opportunities and Challenges


The Chilean aerospace market has expanded in the last five years, and the industry forecast indicates that demand will rise for airport equipment, particularly in the area of security and communications.

Aircraft, including executive planes and training, are in demand. Local airline Lan Airlines has merged with Brazilian TAM Airlines to create LATAM Airlines, which expects to become the fourth largest carrier worldwide. LATAM’s business strategy envisages continuous expansion of passenger and cargo services, which will increase opportunities for Canadian suppliers. LATAM’s purchase decisions are currently focusing on increasing intra-regional air transportation services.

Overhaul services, aircraft parts and modernization of obsolete aircraft electronics have been business areas where Canadian suppliers are recognized for their competence and competitiveness.

Agriculture and Processed Food (including Wine, Beer and Spirits)

Chile has one of the world’s most open agricultural sectors. As such, Chile is a reliable market for Canadian exports of cereals and grains, particularly wheat; animal and vegetable fats and oils (primarily canola); and meat (primarily pork). From Chile, Canada imports fruits and nuts; fish and shellfish (primarily salmon); and beverages and spirits (primarily wine).

Bilateral trade is often complementary in the sense that Canadian exports, particularly of high-quality genetic inputs, are at the base of many Chilean food exports. For example, Canadian salmon genetics are used in the cultivation of Chilean farmed salmon. Canadian livestock and livestock genetics are also often purchased by Chilean farms.

In early 2015, Chile began to import Canadian beef cuts for the first time, and the market has potential for growth. Chile’s domestic production is insufficient to supply the entire market; as such, Chile has become a significant beef importer. Chilean per capita beef consumption is approximately 24.4 kg annually, slightly behind pork (26.6kg) a commodity for which Canada is a significant supplier.

Defence and Security

Chile’s Armed Forces are undertaking a major modernization, buying new equipment and overhauling obsolete systems.

The Chilean Forces follow their own acquisitions planning and contracting processes with the approval of the Ministry of National Defence. For prospective suppliers, contacting the specific planning directorate for each of the forces at the earliest possible date is necessary in order to be considered in the acquisition process. To ensure transparency and confidentiality in the exchange of information between the Chilean Forces and Canadian suppliers, it is necessary that the Canadian companies be listed in the supplier registries of the Chilean Forces. The Canadian Embassy in Chile can provide guidance in this matter.

The Canadian Commercial Corporation (CCC) can provide a Government-to-Government (GtoG) option to support Canadian companies in sales to Chile’s Armed Forces. CCC offers a fast, cost-effective, accountable procurement mechanism guaranteed by the Government of Canada. A Defence Cooperation Memorandum of Understanding signed between the Department of National Defence and the Chilean Ministry of National Defence (MND) on April 16, 2012 provides the official basis for defence procurement. The Canadian Embassy, CCC and DND work together to raise awareness in the Chilean MND and its Forces of the GtoG directed contracting mechanism (similar to, but simpler than, the U.S. Foreign Military Sales system).

Recognized world-class Canadian capabilities align with some of the current modernization opportunities within the Chilean Forces. Canada has particular strengths in Arctic and Maritime Security; protection of soldiers; command and support; cyber-security; training systems; ocean technologies and in-service support.


Education is a priority for the government of Chile, and Chileans are increasingly interested in exploring education opportunities in Canada. Chilean post-secondary institutions are actively looking for partnership possibilities with institutions overseas in order to “internationalize” their campuses, and there are a growing number of partnerships between Chilean and Canadian Institutions. When exploring international education opportunities, Chileans consider factors related to language, the quality of education and the cost of study programs. Although Canada is perceived as a safe and comfortable place to visit and live, its cold climate and geographical distance can be deterrents for some students.

The greatest opportunities for partnerships for Chilean and Canadian institutions are in the following areas: undergraduate and graduate programs, technical training, English as a second language, and K-12.

Regarding undergraduate and graduate programs, opportunities are increasing for postgraduate studies, due mostly to international education scholarships offered by Chile’s National Commission for Science and Technology (Comisión Nacional de Ciencia Y Tecnología). Undergraduate students interested in a student exchange in Canada are eligible to apply for Canada’s Emerging Leaders of the Americas Program or the Canada-Chile Leadership Program.

Regarding technical training, there is significant demand for trained technicians in the local labour market; nevertheless, Chilean students are more inclined to pursue a university degree than to undertake technical studies. The Chilean government partners with international colleges under the Technicians for Chile (Técnicos para Chile) program to send Chilean students to pursue up to one year of studies at selected institutions in the areas of technology, business, health, and tourism, among others. Several Canadian colleges have been selected as partner institutions. In order to become a partner institution, colleges are required to sign an agreement with the Technicians for Chile program.

Regarding English as a second language coursework, the majority of Chilean students have little knowledge of English. As such, academic institutions are interested in partnering with Canadian institutions to send Chilean students to study English in Canada or to bring Canadian professionals to Chile to teach English. Canadian students studying Spanish language and culture are also eligible for Chile’s English Opens Doors Program. This program aims to attract native English speakers to volunteer in Chilean public schools as English teachers and teachers’ assistants.

Regarding K-12, the Chilean government is committed to improving the quality of public education at the preschool and primary school levels and would benefit from exchanges with Canadian experts. A recent education reform proposes the creation of an education sub-secretary (deputy minister) to be in charge of preschool education, regularly coordinating with the Minister of Education, to improve primary and secondary school education.

Information and Communications Technology (ICT)

According to the Chilean Association of IT Companies (ACTI), the ICT sector has recorded steady growth in recent years. ACTI forecasts an increase in sales for the next five years. Services represent the greatest share of the market, accounting for 56 percent of sales. Hardware and software account for 25 percent and 19 percent of sales respectively.

Chile is the Latin American leader in terms of market penetration by mobile communications companies. Access fees have declined in recent years and current market growth is greatest among lower income customers who tend to sign up for less expensive prepaid plans. Multimedia Messaging Services (MMS) have made a significant impact on the Chilean market. Although Chile has the highest level of Internet penetration in Latin America, it is lower than that achieved in many countries in Asia, Europe and North America. There is considerable room for growth. Operators are looking to increase offerings of value-added services to their customers. Mobile operators estimate that revenues from value-added services are currently increasing at a rate of 50 percent per year.

The majority of telecommunications equipment is imported as Chile has yet to develop a large manufacturing industry in this sector. Demand for wireless products is particularly high as the limited domestic production that does exist tends to focus on wired or cable products.

The e-learning sector may provide niche opportunities for Canadian companies over the next few years. There are still relatively low levels of Internet penetration and the lack of uniform teaching methodologies will continue to hinder the growth of the e-learning sector as a whole.

Demand for biometric security solutions is growing rapidly. Use of fingerprint-based biometric information is the most common application with companies using this technology for activities such as building access control, secure financial and healthcare transactions, and even cash withdrawals from automated teller machines.

Software has a general 30 percent withholding (royalty tax) applicable to the intellectual property value of the imported software. However, Canada benefits in this area from terms under the bilateral Avoidance of Double Taxation Agreement (DTA) and a most-favoured-nation clause within the DTA (see below). When rendering a service in Chilean territory, Canadian companies are only subject to a 10 percent withholding tax on standard software applications. Also to note is that the bilateral DTA eliminates withholding tax on payments for technical assistance services used to produce “customized” software and related services income. Typically, online subscriptions are exempt from taxation.


The infrastructure sector remains an important and dynamic sector for Chile’s economic development, and offers many opportunities for Canadian companies.

The Chilean government is delivering on its commitment to increase the budget of the Ministry of Public Works by 11.8 percent in 2015 as it seeks to use infrastructure projects to stimulate a weakening economy. The government has also officially launched an infrastructure plan for 2014-2020 called “Infrastructure, Development and Inclusion." The plan includes US$28 billion in new projects until 2020 and an increase in spending in the sector to 3.5 percent of GDP from the current 2.5 percent. This six-year plan has two main investment areas: the first aims to promote and develop regional infrastructure with a fund of approximately US$18 billion; the second promotes 25 infrastructure concessions with a combined value of approximately US$9.96 billion. In March 2015, the Chilean government increased the portfolio of projects by adding new highway development for a new total of US$12 billion.

In response to Chile's transport infrastructure deficit, the government launched Chile’s Public Transport Infrastructure Plan in November 2014. This plan comprises a 14-project portfolio that will require an investment of US$4.2 billion. Most relevant among the projects are urban cable cars, suburban railways, light rail transit, and subway expansions. The Ministry of Transport has also confirmed US$1.4 billion for investment in major port infrastructure.

This spending program provides timely and tangible opportunities for Canadian companies interested in exploring public-private partnerships (P3). Canadian engineering design and consulting firms, general contractors, operating and maintenance companies, urban planners and architects, institutional investors, and private equity firms all have the capabilities and the interest to pursue these projects (including brownfield investments).

The Chilean government promotes competition as part of its mandate; therefore, Canadian bidders should know in advance that they are likely to be competing against at least five to 10 other consortiums (particularly during the prequalification phase).

Access to capital for these types of projects has become easier in Chile as local banks have become extremely aggressive (due to their high liquidity) and have started to actively participate directly in structuring deals.


Chile is the world’s largest producer and exporter of copper (32.4 percent of global total in 2014), and is also a significant producer and exporter of other metals, concentrates and ores such as molybdenum (world’s 3rd largest producer), gold (world’s 14th largest producer) and silver (world’s 5th largest producer). The mining sector is a main driver of opportunities for Canadian companies in Chile, not only for equipment suppliers but also for suppliers of engineering, procurement, construction and sectoral consultancy services, including training, monitoring and evaluating of social and environmental impacts.

Annual operation and spending by large Chilean mining companies surpasses $10 billion on machinery parts and mining equipment. Annual contract services are valued at about $1.25 billion. Chile also invests $1.5 billion each year in mining projects. Mining products accounted for 54.2 percent of the country’s total export revenues in 2014.

In 2014, Chile’s Ministry of Mining identified 53 mining projects with investment of over US$105 billion for the period from 2014 to 2023. Three quarters of these would be private-sector projects, with the remainder financed by the Chilean government primarily through state-owned copper miner, Codelco. The share of investments by Canadian projects is estimated at 28 percent of the $105 billion. Canada ranks as the largest foreign investor in Chile’s mining sector and according to the list of projects on the books, will maintain a predominant position.

With more mines under development and annual copper production projected to increase from 5.4 million metric tonnes in 2015 to 8.5 million metric tonnes in 2025 (an increase of 57 percent), the demand for ancillary equipment and services will rise, creating opportunities for Canadian mining suppliers. Various Canadian suppliers to the mining sector have increased their presence in Chile, and many firms have established joint ventures with local firms to gain a competitive edge.

Virtually all Canadian machinery and mechanical equipment, including mining machinery and equipment, enters Chile duty-free. There are no impediments to the importation of mining equipment, machinery and components.

Sustainable Technologies

High levels of Canadian investments in electrical power transmission and distribution in Chile offer opportunities for Canadian renewable energy companies to supply and further invest in the energy market. The emerging Chilean market for renewable energy is a good match for Canadian capabilities. The Chilean government’s Energy Agenda has a specific focus on renewable energy and energy efficiency.

Under the Canada-Chile Joint Energy Statement (2013), renewable energy, energy efficiency and liquefied natural gas (LNG) are the three main areas outlined for Chilean and Canadian cooperation. Both Canada’s Trade Commissioner Service and Export Development Canada have relationships with key players in the Chilean energy sector that facilitate introductions of Canadian companies to procurement opportunities.

Electricity prices in Chile continue to be among the highest in Latin America, which, coupled with a liberalized electricity market, growing environmental concerns and rising energy demand – driven by the country’s expanding consumer base and energy-intensive mining industry – make Chile an attractive market for Canadian renewable energy suppliers. The Chilean government seeks to maximize Chile’s abundant hydro resources. As such, small run-of-river hydro projects (less than 20 MW) are seeing considerable growth. The Chilean government continues to promote renewable energy to lessen the country’s dependence on external sources, but also to have a more diversified and clean electricity generating grid. In sum, the Chilean government is seeking to strengthen the country’s energy security in an environmentally sustainable manner.

The Government of Canada actively promotes Canadian capabilities in renewable energy with a focus on solar energy as the Chilean government is developing a public-private “solar hub” in Northern Chile, a location that receives among the highest levels of solar radiation in the world.

An estimated 8,000 MW of installed electricity generation capacity will be needed by 2020 to cover Chilean energy demand. This will require significant investments in expanding Chile’s transmission capacity and will include ‘smarter’ technologies to support Chile’s economic development through grid reliability and operational efficiency.

Chile is a net importer of LNG. The Chilean government’s Energy Plan includes LNG imports as its policy for base-load power plants.

Major Negotiations and Agreements

Trans-Pacific Partnership (TPP)

The TPP Agreement is the most comprehensive and ambitious regional trade agreement in the Asia Pacific and will deepen Canada’s trade ties in this dynamic and fast growing region. The TPP currently comprises 12 countries (Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Vietnam), representing a combined market of nearly 800 million people and a GDP of $28.5 trillion.

Canada-Chile Free Trade Agreement

The Canada-Chile Free Trade Agreement (CCFTA), in force since 1997, is the cornerstone of Canada’s commercial relationship with Chile. The CCFTA covers goods, services and investment. A financial services chapter and updated chapters on government procurement, dispute settlement and custom procedures were added and came into force on September 30, 2013. More recently, Canada and Chile announced the conclusion of negotiations of a new technical barriers to trade chapter and related annexes in November 2014, and of a new sanitary and phytosanitary chapter and technical amendments to the government procurement chapter in April 2015. Negotiations for a chapter dealing with technical barriers to trade were also concluded in late 2014. Both countries have also agreed to bring into force amendments to the rules of origin as soon as possible.

Avoidance of Double Taxation Agreement

The Convention between Canada and the Republic of Chile for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income on capital was signed on January 21, 1998. A general rate of withholding tax of 15 percent is levied on dividends, interest and royalties paid to foreign income earners, although the rate is 10 percent for companies where the taxpayer owns at least 25 percent of the voting power of any company. The tax represents a credit against taxes in the other jurisdiction.

Customs Mutual Cooperation Assistance Agreement

A bilateral Customs Mutual Assistance Agreement (CMAA) with Chile, signed in April 2015, provides a legal framework for the two countries to share customs information to prevent, investigate and combat customs offences.

Canada-Chile Air Transport Agreement

The Canada-Chile Air Transport Agreement came into force in September 2005 and permits airlines of both countries to serve each other’s markets with no limits on frequency or capacity for direct flights.

Selected Trade Initiatives – Seize the Opportunity!

  • Mining
    • PDAC (annual), March 6-9, 2016, Toronto, Canada
    • Exponor (bi-annual), May 2017, Antofagasta, Chile
    • Cesco (annual), April 2016, Santiago, Chile
    • Expomin (bi-annual) April 25-29 2016, Santiago, Chile
  • Forestry and Wood Products
    • ExpoCorma (bi-annual), November 18-20, 2015, Concepción, Chile
  • Defence and Security
    • Exponaval (bi-annual), November 29-December 2, 2016, Base Areonaval Concón, Viña del Mar, Chile
    • CANSEC (annual), May 25-26, 2016, Ottawa, Canada
  • Aerospace
    • FIDAE (bi-annual), March 29-April 3, 2016, Pudahuel, Santiago

Support Services

Where not otherwise indicated, the information is provided by the Embassy of Canada to Chile. This document is not intended to provide specific advice and should not be relied on as such. It is intended as an overview only. No action or decision should be taken without detailed independent research and professional advice concerning the specific subject matter of such action or decision. While Foreign Affairs, Trade and Development Canada (DFATD) has made reasonable efforts to ensure that the information contained in this document is accurate, DFATD does not represent or warrant the accurateness, timeliness or completeness of the information contained herein. This document or any part of it may become obsolete at any time. It is the user’s responsibility to verify any information contained herein before relying on such information. DFATD is not liable in any manner whatsoever for any loss or damage caused by or resulting from any inaccuracies, errors or omissions in the information contained in this document. This document is not intended to and does not constitute investment, legal or tax advice. For investment, legal or tax advice, please consult a qualified professional.