Chile economy is experiencing unprecedented growth in the world economy. While other countries are struggling to stay solvent, Chile’s economy is expanding and growing at rapid speed. With a devastating earthquake in its recent past, the economy is growing due to the reconstruction efforts in the areas affected. This has resulted in growth in the industries directly needed for reconstruction,natural resources, transportation and general labor.
Chile produces more copper than any other country in the entire world. The demand for copper all over the world is high and companies are willing to pay for the product. This has been a boon to the country’s financial growth. Chile produces five times the amount of copper as the US and the workers work for less money. The country is also plentiful in other natural resources and harvesting these and shipping them throughout the region and the world has enabled additional growth. Having an abundance of natural resources and a large labor pool has also attracted major corporations and businesses from around the world to set up enterprises in the country. Additional population helps to drive up the need and demand for basic needs from food production to housing.
This South American country’s economy was facing recession merely a year ago, but seems to have found its way back with a vengeance. The Economist Magazine predicts a growth in the economy of nearly 5% and predicts a future growth for next year of 6%–virtually unheard of in today’s fragile economic state. Chile has made amazing steps to rebound after a tragic natural disaster that would have sent other country’s economies reeling. This has led investors to look at a Chile ETF as a viable investment option and have caused many to consider a leveraged etf.
Politics and policy have also played a part, with a successful shift from dictator to democracy the economy was allowed to grow freely without the governmental restraint that General Augusto Pinochet had supplied. Consideration should also be paid to the basic rules of financial and political engagement which Chile has established. The country supports open markets, financial responsibility and restraint and has crafted an effective anti-poverty program. Chile pioneered counter-cyclical fiscal policy, where when the country and its finances were thriving, monies were saved and during recessions the monies were utilized to stimulate economic growth.