Chile

Market overview

Chile closed its borders on 18 March and a State of Catastrophe was decreed. The number of Covid-19 cases in Chile continues to rise and the President has declared that the health system is “…under strain and close to collapse”. More than 25,000 cases have been recorded in the Santiago metropolitan region in the past week and intensive care units are at 96% occupancy in Santiago. There is also increasing incidence of social unrest and protests, particularly in the poorer neighbourhoods, due to perceived lack of government aid.

For more information on doing business in Chile, visit myNZTE - our free online portal for curated, in-depth information and guidance. 

For more information on doing business in Colombia, visit myNZTE - our free online portal for curated, in-depth information and guidance. 

Useful links (Spanish language)


Supply chain, freight & logistics

Since 18 March, all Chile's land, sea and air borders have been closed to foreign citizens. In an attempt to minimise impact on the normal supply of goods and services, this measure will not affect the entry and exit of cargo and associated personnel1.

As a result of travel restrictions, travel and airline schedules have come to a halt, and with them air freight options. LATAM announced the cancellation of their Santiago – Auckland flights from 1 – 30 April.

Despite this, in the face of the COVID-19 crisis, Chile (along with Canada, Australia, Brunei and Myanmar) has joined forces with New Zealand and Singapore to commit to keeping supply chains open and removing any existing trade restrictions on essential goods, especially medical supplies.

Government support

The Government has announced a package of economic measures to protect the health and income of Chilean families in the face of COVID-19. It represents some US$11.75 billion in fiscal resources and has three main pillars: reinforcing the health system's budget, protecting family income, and protecting jobs and businesses.

The measures include:

  • A bill to guarantee payment of the income of those who, because of the emergency, must stay at home and are unable to work remotely.

  • A benefit equivalent to that for the Family Subsidy (SUF), which will benefit 2 million people without a formal job.

  • A three-month postponement of companies' provisional monthly payments (PPM) of income tax

  • A three-month postponement of VAT payment by all companies with sales of less than 350,000 Unidades de Fomento (UF).

  • Postponement of income tax payment by SMEs until July 2020.

  • Reduction of stamp tax to 0% on all borrowing operations during the next six months.

Due to the COVID-19 outbreak, institutions, such as the Bank of America, are predicting lower or negative growth rates for Chile a decrease in the price of copper, and an ongoing oil price war. Copper, one of Chile's most significant exports, has experienced a fall in price and exports dropped by 14% during February 2020.

Chile's Central Bank has a range of instruments to face these economic challenges. As of 1 April, the Central Bank has reduced interest rates to 0.5%, this follows a recent cut of 0.75% that lowered interest rates to 1%.

On 8 April, the Government announced a second stage to its emergency plan that complements the measures taken by the Central Bank to strengthen liquidity in the financial market and by the Financial Market Commission to relax regulations that allow better access for companies to loans. There are two major focus areas to the additional plan:

  • A US$2 billion income protection fund for independent workers who had not been included in previous measures. There are some 2.6 million informal workers without an employment contract, who are not eligible for the unemployment insurance.

  • Support package for SME's and entrepreneurs through financing lines, of up to 85%, that will be made available by the State. This new line of credit with a State guarantee will limit the extraordinary credit risk generated by the State of Emergency and will facilitate conditions for banks to lend working capital to companies for a term of up to 48 months, with a grace period of up to six months and for an equivalent amount of up to 3 months of sales. The credit lines will be available until 30 September of this year and will allow financing loans to companies for up to US$24 billion.


Sector insights

As is to be expected, numerous sectors have been impacted by the COVID-19 pandemic. Below you'll find information on any COVID-19 effects across important sectors and industries in Chile.

Forestry

The sector, through their Forestry Corporation (CORMA), has joined forces to ensure the supply of essential products to the supply chain. However, they are working with only essential workers in order to comply with Government preventative measures to protect the health of their workers.

Companies have also contributed with special measures for the emergency. For example, CMPC (paper products) through their subsidiary Softys (hygiene products) will manufacture 1 million masks per month to supply community health centres for free. The company purchased two machines to manufacture them.

Arauco's US$2.5 billion project MAPA continues but has had some opposition from workers due to some COVID-19 cases being recorded by some workers on the construction site. However, Arauco announced extra preventative measures to protect the health of their workers so the project can continue.

Additional resources

Below you can find information and contact details for other New Zealand government and international agencies regarding their response to COVID-19.

New Zealand Government agencies

Covid19.govt.nz
COVID-19 helpline for businesses
Business.govt.nz
New Zealand Customs
Ministry for Primary Industries (MPI)
New Zealand Export Credit (NZEC)
MFAT Export Helpline
MFAT Safetravel
Callaghan Innovation
Immigration
Ministry of Health
WorkSafe New Zealand
myNZTE

Global agencies

World Health Organization (WHO)
Centers for Disease Control and Prevention (CDC)

Contact NZTE

We're available to talk to you about any issues your export business is facing due to COVID-19.

For existing NZTE customers, please contact your New Zealand-based Customer Manager.

If you're unsure who to contact or haven't worked with us before, you can call NZTE on 0800 555 888 or email below and one of our Customer Advisors will help you.