Wonders of the Chilean economy

I’m still wondering the chilean economy and society. I’ve learned that Chile’s main trading partners are Europe, United States, Japan and China, in that order. Big, strong, established, and very progressive (especially China) economies, no doubt. So what’s the problem? I am asking where is Argentina, Brazil and Mexico – the three biggest economies on the continent!?

Ok, Mexico comes rights after China. Maybe because they buy chilean wine, and chileans buy back mexican beer. Big deal. Besides, Mexico is in North America, thousands of kilometres away while Argentina is just across the border. Brazil is also close by. However, Chile isn’t even a part of Mercosur, a trade agreement where Argentina and Brazil trade together. My question is why. Where is the European Union of South America?

Someone who has worked here in European embassies for more than twenty years gave an interesting analysis: while the chilean economy may have changed, the people have not. They don’t think global in the sense US and Europe do. They don’t act united. They don’t develop technological skills that would be needed outside. Chile still continues to buy all relevant technological knowhow from international companies. They buy everything from cars to electronics and even foodstuff abroad. Far away abroad.

In the end, Chile just inreases consumption and may not produce anything interesting to world markets in the long term. What is more, the consumption is hazardous. Those with access to capital seem to admire american standards (SUVs, shopping mall culture) without any regard to natural preservation (heavy air pollution, litter etc). They don’t ask what they can do for their country. They ask what their country can do for them.

The flip side of the development aid bandwagon is that according to figures Chile is so developed it won’t get too much foreign aid funds anymore. The result is a country stuck in between a developing nation and a developed one. Not a very interesting place businesswise. You may sell your stuff or ideas here. But if you are not into wines and copper, I don’t know if you can buy anything out from here or start a new venture in here.

My rather pessimistic end conclusion is that this place won’t be the edge of the world in my lifetime. I hope this is just the angst of the first one and a half months in Santiago. I hope I’m wrong.

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