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Chile has the most dynamic economy in Latin America. In 2010, Chile’s GDP expanded by 5.2% while per capita income reached its highest level in eight years, this despite Chile suffering the sixth largest earthquake ever recorded. The IMF estimates Chile’s GDP will reach $222,788 million in 2011, a 6% increase over 2010. The World Bank anticipates that Chile will grow by 5.8% in 2011 and 5% in 2012.
Taxes in Chile are the lowest in Latin America and well below many European countries. Chile has one of the lowest corporate income tax rates worldwide at 17% (temporarily increased to 20% in 2011 and 18.5% in 2012 as part of the country’s earthquake reconstruction program). Chile has bilateral agreements to avoid double taxation with 22 countries including Spain, the United Kingdom, France, Poland and Brazil, and tax treaties with the U.S., Russia and Australia.
Chile has a low level of corruption and government efforts are raising standards of administration. It ranks first in Latin America and 21st among 178 countries worldwide in transparency, according to the Perceived Corruption Index. Eighty percent of the Chilean economy is free. Chile placed 11th out of 179 countries in the Index of Economic Freedom World Rankings by Heritage Foundation.
Chile is Latin America’s most competitive economy. It is ranked 28th among 139 countries worldwide and first in Latin America in the Global Competitiveness Index calculated by the World Economic Forum, which also says Chile is “at the forefront of market liberalization”. Moreover, Chile is ranked 25th out of 59 economies and leads Latin America in competitiveness, according to the 2011 World Competitiveness Yearbook published by the Institute for Management Development (IMD).
Outstanding Quality of Life
Chile offers a perfect mix of natural beauty, public safety, political stability and modern infrastructure. In a 2010 report, Newsweek magazine ranked Chile 30th worldwide and the best country to live in Latin America due to its economy, health system and political environment. International Living magazine ranked Chile third in South America and gave it top marks for safety in its 2010 Quality of Life Index.
Attractive Business Environment
Chile has an attractive and dynamic business climate. It is the first country in Latin America and 10th among 179 countries worldwide for economic freedom, according to the Economic Freedom Index 2010. And Chile is first in Latin America and 15th among 82 economies worldwide for its business friendly environment, according to the Business Environment Ranking 2010-2014.
Chile is a reliable and safe place to do business. It is the only nation in Latin America to receive the lowest political risk rating from Aon Corporation, a Chicago-based organization offering risk management services for corporations looking to invest overseas. Chile’s report card for financial security boasts all As: Standard & Poor’s gave Chile an A+ credit rating; Moody’s ranked economic stability an Aa3; and Fitch scored the country an A.
Talented Human Resources
A highly educated and skilled workforce is one of Chile’s main assets. Chile has 61 universities, 43 professional training institutes (giving four-year courses) and 11 technical training centers (giving two-year courses). It is home to three of Latin America’s 10 best business schools, according to a 2010 ranking by AméricaEconomia magazine. Two Chilean universities are classed among the 10 best in Latin America.
Chile has made remarkable progress in connectivity with the involvement of the private sector. In its annual study ranking world innovators, The Global Innovation Index 2011, INSEAD Business School ranked Chile 38th internationally and first in Latin America and the Caribbean, four places higher than 2010. Chile ranked first in Latin America and 30th out of 70 countries globally in e-readiness, according to the Economist Intelligence Unit’s Digital Economy Ranking 2010.
A Regional Platform
Chile is a good jumping off point for regional operations. Chile’s tax system benefits enterprises that administer businesses in other Latin American countries. Companies that use Chile as a business platform (e.g. regional HQs) can administer investments in other countries without paying Chilean income taxes on profits the foreign investments generate.
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Tue, Oct 08, 2013
Source: World Bank