The Chilean government has decided to strengthen the country’s institutional framework for attracting foreign direct investment (FDI) by boosting the work of the Foreign Investment Committee as its only FDI attraction agency.
In this context, the InvestChile program of the government’s Economic Development Agency (CORFO) will be absorbed by the Foreign Investment Committee which will, as a result, become a “single window” for contact between foreign investors and the State of Chile.
This measure seeks to avoid the duplication of functions, thereby streamlining both promotion of Chile as a destination for FDI and the services it provides to potential investors.
The initiative forms part of the government’s Competitiveness Enhancing Agenda, a group of measures coordinated by the Ministry of Economy, Economic Development and Tourism, which seeks to increase Chile’s competitiveness. Specifically, it will contribute to implementation of the Agenda’s Measure Nº 49, which aims to increase efficiency in the use of the resources devoted to promoting Chile overseas.
“We are confident that this new policy will allow us to be even more efficient in fostering the entry of FDI and, thereby, contribute to our country’s economic development,” said Matías Mori, the Executive Vice-President of the Foreign Investment Committee. The benefits of FDI include direct and indirect job creation, innovation, technology transfer, training and the development of support industries, noted Mori.
As a result of this initiative, Chile will now have a single agency for attracting and receiving foreign investors, working in coordination with the government’s export promotion agency, ProChile, and its network of offices around the world. “This brings us into line with the best FDI attraction policies of the world’s most important countries, improves access to information and reduces the cost of doing business in Chile for foreign investors,” pointed out Mori.
The Executive Vice-President of the Foreign Investment Committee also noted that measures of this type are particularly important at times of international economic uncertainty when competition to attract foreign capital is ever more intense. “Although foreign investors see Chile as a safe and reliable destination for their capital, we cannot rest on our laurels and must keep our eyes on international competition to attract FDI,” he said.“All the trends in international organizations as well as our own experience indicate that, in post-crisis years, there is an enormous flow of foreign investment and, for stable and safe economies like ours, this represents an exceptional opportunity to attract FDI,” explained Mori.
He added that it is possible to foresee an increase in the flow of investment from the northern to the southern hemisphere. Particularly in view of China’s sustained growth, demand for mineral resources is expected to remain strong, suggesting higher investment in Chile from China as well as Asia in general, said Mori. This trend was, indeed, already apparent in 2011 when three Asian economies (Japan, South Korea and China) were for the first time among the top ten countries presenting applications for investments in Chile. “In this context, our challenge is to ensure that no overseas company fails to invest in Chile because it did not know on which door to knock,” concluded Mori.
Created in 1953, the Foreign Investment Committee is formed by the Ministers of Economy (who acts as its President), Finance, Foreign Relations and Social Development as well as the President of the Central Bank. It is managed by an Executive Vice-President appointed by the President of the Republic.
The Committee’s principal objectives include diversification of the matrix of countries that invest in Chile as well as of the sectors to which this investment has traditionally been devoted, increasing FDI in industries such as energy, tourism and agribusiness and in infrastructure. Its ability to achieve all these objectives will be strengthened with the implementation of this new policy for attracting FDI from around the world.