Business in Chile: Chile is a steady and thriving country that has consistently ranked high in political and economic international indices relevant to international business, including an A+ rating from risk agency Fitch.
Doing Business – International Trade and Foreign Investment in Chile
The country continues to employ policies that promote international trade and is a member of the Pacific Alliance, the Rio Group, Mercosur, APEC, and UNASUR. With a business environment that promotes foreign investment in practically every sector and a growing start up ecosystem, it is no wonder that Chile is a favourite destination for entrepreneurs.
According to the Doing Business study published by the World Bank, Chile is the 57th easiest country to do business in. Opening a company in Chile takes 7 procedures, roughly 5.5 days, costs approximately 0.70% of income per capita, and requires zero paid-in minimum capital even though a small one is recommended to avoid future problems with banks. The study also shows that Chile has the highest possible score on the shareholder rights index, it only takes 43 days to get connected to the electric grid in Santiago, and the cost to register a transfer property is only 1% of the property’s value.
Foreign investors in Chile may access all productive activities freely, especially in the food, infrastructure, tourism, energy, and mining industries; there are some restrictions in certain sectors such as in the maritime, media, and air transportation sectors. The mining sector in Chile for instance, is full of opportunities for foreign investment. According to the Invest Chile website, these are the best areas within the mining industry for international investment:
- Scale-up of technology in continuous-operation consumables.
- Transition from open-pit to underground operation.
- Integrated autonomous operations.
- Solutions to minimize energy consumption in milling and hydrometallurgical processes.
- Technologies to control impurities in concentrate.
- Technologies for efficient treatment of tailings.
- Modernization of smelters and refineries.
- Exploitation of rare earth elements.
- Exploration projects.
However, someone investing in the mining sector in Chile will need to secure a diversity of permits and official authorizations. Therefore, it is always better to consult with a lawyer familiarized with the mining sector in Chile before deciding to invest.
Business in Chile: Incentives for Foreign Investors in Chile
Another reason to do business in Chile is the incentives offered for both local and foreign investors. The government does not subsidize foreign investment, but it does offer incentives when businesses help remote regions such as Tarapacá, Aysen, Arica and Pariancota, Magallanes, Palena and Chiloé. They also offer incentives for micro or small and medium sized enterprises involved in technology. For instance, Chile conceived StartUp Chile, a 40 million USD program in which entrepreneurs receive grants of $14,000 USD, $30,000 USD or $80,000 USD depending on the size of their business – and a work visa to accelerate or develop their start-ups in Chile.
Expats should note that work visas are required for Chile. There are different kinds of visas depending on the reason for entering Chile (working holiday, temporary residency, start-up visa, etc.). In order to simplify the visa process, anyone looking to relocate to Chile should contact a visa or immigration lawyer to find the best option for them. If you require any extra information regarding the visa process, company formation/incorporation in Chile, don’t hesitate to get in contact with David from Biz Latin Hub here.