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Chile vs. Bolivia

Economy

ChileBolivia
Economy - overview

Chile has a market-oriented economy characterized by a high level of foreign trade and a reputation for strong financial institutions and sound policy that have given it the strongest sovereign bond rating in South America. Exports of goods and services account for approximately one-third of GDP, with commodities making up some 60% of total exports. Copper is Chile’s top export and provides 20% of government revenue.

From 2003 through 2013, real growth averaged almost 5% per year, despite a slight contraction in 2009 that resulted from the global financial crisis. Growth slowed to an estimated 1.4% in 2017. A continued drop in copper prices prompted Chile to experience its third consecutive year of slow growth.

Chile deepened its longstanding commitment to trade liberalization with the signing of a free trade agreement with the US, effective 1 January 2004. Chile has 26 trade agreements covering 60 countries including agreements with the EU, Mercosur, China, India, South Korea, and Mexico. In May 2010, Chile signed the OECD Convention, becoming the first South American country to join the OECD. In October 2015, Chile signed the Trans-Pacific Partnership trade agreement, which was finalized as the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP) and signed at a ceremony in Chile in March 2018.

The Chilean Government has generally followed a countercyclical fiscal policy, under which it accumulates surpluses in sovereign wealth funds during periods of high copper prices and economic growth, and generally allows deficit spending only during periods of low copper prices and growth. As of 31 October 2016, those sovereign wealth funds - kept mostly outside the country and separate from Central Bank reserves - amounted to more than $23.5 billion. Chile used these funds to finance fiscal stimulus packages during the 2009 economic downturn.

In 2014, then-President Michelle BACHELET introduced tax reforms aimed at delivering her campaign promise to fight inequality and to provide access to education and health care. The reforms are expected to generate additional tax revenues equal to 3% of Chile’s GDP, mostly by increasing corporate tax rates to OECD averages.

Bolivia is a resource rich country with strong growth attributed to captive markets for natural gas exports – to Brazil and Argentina. However, the country remains one of the least developed countries in Latin America because of state-oriented policies that deter investment.

Following an economic crisis during the early 1980s, reforms in the 1990s spurred private investment, stimulated economic growth, and cut poverty rates. The period 2003-05 was characterized by political instability, racial tensions, and violent protests against plans - subsequently abandoned - to export Bolivia's newly discovered natural gas reserves to large Northern Hemisphere markets. In 2005-06, the government passed hydrocarbon laws that imposed significantly higher royalties and required foreign firms then operating under risk-sharing contracts to surrender all production to the state energy company in exchange for a predetermined service fee; the laws engendered much public debate. High commodity prices between 2010 and 2014 sustained rapid growth and large trade surpluses with GDP growing 6.8% in 2013 and 5.4% in 2014. The global decline in oil prices that began in late 2014 exerted downward pressure on the price Bolivia receives for exported gas and resulted in lower GDP growth rates - 4.9% in 2015 and 4.3% in 2016 - and losses in government revenue as well as fiscal and trade deficits.

A lack of foreign investment in the key sectors of mining and hydrocarbons, along with conflict among social groups, pose challenges for the Bolivian economy. In 2015, President Evo MORALES expanded efforts to court international investment and boost Bolivia’s energy production capacity. MORALES passed an investment law and promised not to nationalize additional industries in an effort to improve the investment climate. In early 2016, the Government of Bolivia approved the 2016-2020 National Economic and Social Development Plan aimed at maintaining growth of 5% and reducing poverty.

GDP (purchasing power parity)
$452.1 billion (2017 est.)
$445.5 billion (2016 est.)
$439.9 billion (2015 est.)

note: data are in 2017 dollars

$83.72 billion (2017 est.)
$80.35 billion (2016 est.)
$77.07 billion (2015 est.)

note: data are in 2017 dollars

GDP - real growth rate
1.03% (2019 est.)
4% (2018 est.)
1.41% (2017 est.)
2.22% (2019 est.)
4.23% (2018 est.)
4.19% (2017 est.)
GDP - per capita (PPP)
$24,600 (2017 est.)
$24,500 (2016 est.)
$24,400 (2015 est.)

note: data are in 2017 dollars

$7,600 (2017 est.)
$7,400 (2016 est.)
$7,200 (2015 est.)

note: data are in 2017 dollars

GDP - composition by sector
agriculture: 4.2% (2017 est.)
industry: 32.8% (2017 est.)
services: 63% (2017 est.)
agriculture: 13.8% (2017 est.)
industry: 37.8% (2017 est.)
services: 48.2% (2017 est.)
Population below poverty line
14.4% (2013)
38.6% (2015 est.)

note: based on percent of population living on less than the international standard of $2/day

Household income or consumption by percentage share
lowest 10%: 1.7%
highest 10%: 41.5% (2013 est.)
lowest 10%: 0.9%
highest 10%: 36.1% (2014 est.)
Inflation rate (consumer prices)
2.2% (2017 est.)
3.8% (2016 est.)
2.8% (2017 est.)
3.6% (2016 est.)
Labor force
7.249 million (2020 est.)
5.719 million (2016 est.)
Labor force - by occupation
agriculture: 9.2%
industry: 23.7%
services: 67.1% (2013)
agriculture: 29.4%
industry: 22%
services: 48.6% (2015 est.)
Unemployment rate
7.22% (2019 est.)
7.33% (2018 est.)
4% (2017 est.)
4% (2016 est.)

note: data are for urban areas; widespread underemployment

Distribution of family income - Gini index
50.5 (2013)
57.1 (2000)
47 (2016 est.)
57.9 (1999)
Budget
revenues: 57.75 billion (2017 est.)
expenditures: 65.38 billion (2017 est.)
revenues: 15.09 billion (2017 est.)
expenditures: 18.02 billion (2017 est.)
Industries
copper, lithium, other minerals, foodstuffs, fish processing, iron and steel, wood and wood products, transport equipment, cement, textiles
mining, smelting, electricity, petroleum, food and beverages, handicrafts, clothing, jewelry
Industrial production growth rate
-0.4% (2017 est.)
2.2% (2017 est.)
Agriculture - products
grapes, apples, pears, onions, wheat, corn, oats, peaches, garlic, asparagus, beans; beef, poultry, wool; fish; timber
soybeans, quinoa, Brazil nuts, sugarcane, coffee, corn, rice, potatoes, chia, coca
Exports
$69.23 billion (2017 est.)
$60.6 billion (2016 est.)
$7.746 billion (2017 est.)
$7.214 billion (2016 est.)
Exports - commodities
copper, fruit, fish products, paper and pulp, chemicals, wine
natural gas, silver, zinc, lead, tin, gold, quinoa, soybeans and soy products
Exports - partners
China 27.5%, US 14.5%, Japan 9.3%, South Korea 6.2%, Brazil 5% (2017)
Brazil 17.9%, Argentina 16%, US 7.8%, Japan 7.3%, India 6.6%, South Korea 6.3%, Colombia 5.8%, China 5.1%, UAE 4.7% (2017)
Imports
$61.31 billion (2017 est.)
$55.29 billion (2016 est.)
$8.601 billion (2017 est.)
$7.888 billion (2016 est.)
Imports - commodities
petroleum and petroleum products, chemicals, electrical and telecommunications equipment, industrial machinery, vehicles, natural gas
machinery, petroleum products, vehicles, iron and steel, plastics
Imports - partners
China 23.9%, US 18.1%, Brazil 8.6%, Argentina 4.5%, Germany 4% (2017)
China 21.7%, Brazil 16.8%, Argentina 12.6%, US 8.4%, Peru 6.5% (2017)
Debt - external
$183.4 billion (31 December 2017 est.)
$158.1 billion (31 December 2016 est.)
$12.81 billion (31 December 2017 est.)
$7.268 billion (31 December 2016 est.)
Exchange rates
Chilean pesos (CLP) per US dollar -
653.9 (2017 est.)
676.94 (2016 est.)
676.94 (2015 est.)
658.93 (2014 est.)
570.37 (2013 est.)
bolivianos (BOB) per US dollar -
6.86 (2017 est.)
6.86 (2016 est.)
6.91 (2015 est.)
6.91 (2014 est.)
6.91 (2013 est.)
Fiscal year
calendar year
calendar year
Public debt
23.6% of GDP (2017 est.)
21% of GDP (2016 est.)
49% of GDP (2017 est.)
44.9% of GDP (2016 est.)

note: data cover general government debt and includes debt instruments issued by government entities other than the treasury; the data include treasury debt held by foreign entities; the data include debt issued by subnational entities

Reserves of foreign exchange and gold
$38.98 billion (31 December 2017 est.)
$40.49 billion (31 December 2016 est.)
$10.26 billion (31 December 2017 est.)
$10.08 billion (31 December 2016 est.)
Current Account Balance
-$10.933 billion (2019 est.)
-$10.601 billion (2018 est.)
-$2.375 billion (2017 est.)
-$1.932 billion (2016 est.)
GDP (official exchange rate)
$277 billion (2017 est.)
$37.78 billion (2017 est.)
Stock of direct foreign investment - at home
$206.2 billion (31 December 2017 est.)
$199.8 billion (31 December 2016 est.)
$12.31 billion (31 December 2017 est.)
$11.6 billion (31 December 2016 est.)
Stock of direct foreign investment - abroad
$95.37 billion (31 December 2017 est.)
$90.54 billion (31 December 2016 est.)
$0 (31 December 2017 est.)
$0 (31 December 2016 est.)
Market value of publicly traded shares
$190.4 billion (31 December 2015 est.)
$233.2 billion (31 December 2014 est.)
$265.2 billion (31 December 2013 est.)
$12.8 billion (31 December 2017 est.)
$12.3 billion (31 December 2016 est.)
$11.11 billion (31 December 2015 est.)
Central bank discount rate
3.35% (31 December 2015)
3% (31 December 2014)
2.5% (31 December 2017 est.)
2.5% (31 December 2016 est.)
Commercial bank prime lending rate
4.6% (31 December 2017 est.)
5.59% (31 December 2016 est.)
8.11% (31 December 2017 est.)
7.95% (31 December 2016 est.)
Stock of domestic credit
$244.3 billion (31 December 2017 est.)
$211.6 billion (31 December 2016 est.)
$25.61 billion (31 December 2017 est.)
$22.39 billion (31 December 2016 est.)
Stock of narrow money
$52.54 billion (31 December 2017 est.)
$44.01 billion (31 December 2016 est.)
$9.616 billion (31 December 2017 est.)
$9.09 billion (31 December 2016 est.)
Stock of broad money
$52.54 billion (31 December 2017 est.)
$44.01 billion (31 December 2016 est.)
$9.616 billion (31 December 2017 est.)
$9.09 billion (31 December 2016 est.)
Taxes and other revenues
20.8% (of GDP) (2017 est.)
39.9% (of GDP) (2017 est.)
Budget surplus (+) or deficit (-)
-2.8% (of GDP) (2017 est.)
-7.8% (of GDP) (2017 est.)
Unemployment, youth ages 15-24
total: 18.1%
male: 16.7%
female: 20.2% (2018 est.)
total: 6.9%
male: 6.8%
female: 7.1% (2018 est.)
GDP - composition, by end use
household consumption: 62.3% (2017 est.)
government consumption: 14% (2017 est.)
investment in fixed capital: 21.5% (2017 est.)
investment in inventories: 0.5% (2017 est.)
exports of goods and services: 28.7% (2017 est.)
imports of goods and services: -27% (2017 est.)
household consumption: 67.7% (2017 est.)
government consumption: 17% (2017 est.)
investment in fixed capital: 21.3% (2017 est.)
investment in inventories: 3.8% (2017 est.)
exports of goods and services: 21.7% (2017 est.)
imports of goods and services: -31.3% (2017 est.)
Gross national saving
20.5% of GDP (2017 est.)
20.9% of GDP (2016 est.)
21.4% of GDP (2015 est.)
15.7% of GDP (2017 est.)
15.3% of GDP (2016 est.)
14.2% of GDP (2015 est.)

Source: CIA Factbook