Mining in Chile – it’s all about credibility

Chile is a country that is thriving in commodities, with the mining sector one of the main pillars of its economy. There is a lot of hiring going on, as the Chilean government strongly supports foreign investment into the sector, having modified its mining industry laws and regulations to create a more favourable environment for overseas investors looking to develop opportunities.

Thanks to progressive legislation and a healthy investment environment, the GDP from mining in Chile increased to 3592 CLP billion (USD 4.8 billion) in the second quarter of 2017, up from 3235 CLP billion (USD 4.4 billion) in the first three months of the year. Its large copper resources mean the country has grown to become the copper mining capital of the world, producing over a third of global output. And that market is thriving – when the global copper industry gathered in the Chilean capital Santiago for its annual World Copper Conference in April 2017, it was the first time that attendees arrived to discuss a copper price that was higher than a year ago.

Chile is strongly committed to free trade; they have attracted and welcomed large amounts of foreign investment over the past decade. The country has signed free trade agreements with a number of countries, including the United States which it implemented in 2004. The government has done well to position Chile as one of the key commodity markets in Latin America; corruption levels are low and they have a good local education system.

In July, mining giant BHP received government approval to go ahead with a $2.5 billion expansion of its Spence copper mine (in Chile’s Atacama desert), which could generate as many as 4,000 temporary jobs and 220 permanent positions for the local economy, as well as adding 200,000 tonnes of copper a year to BHP’s output. An even larger project, Teck Resources’ $5 billion Quebrada Blanca phase 2, in Chile’s far northern region of Atacama, is also under consideration.

A strong pool of local professionals is available to those looking to invest in Chile, with the only downside being a relative shortage of English-speaking talent. Our clients have identified strong opportunities within commodities; investors are moving in and companies are growing, however, they have recognized the need to upskill some of the local workforce in order to maximise their return on investment.
Chile is a wealthy country, with the third highest GDP per capita in Latin America. It has no scarcity of decision-makers and C-suite executives willing to work for inbound commodities investors. The recruitment market is buoyant, however, those wishing to hire local talent will need to be prepared to invest in upgrading language skills to achieve cross-border integration.