• According to InvestChile’s analysis of the second quarter Corporación de Bienes de Capital (CBC) portfolio, the US$37.5 billion in foreign private investment represents a 24% increase over the previous quarter.

Foreign projects lead the private investment planned for Chile during the 2024-2028 period, according to the InvestChile Strategy and Investment Climate division’s analysis of the latest report by Corporación de Bienes de Capital (CBC).

The analysis revealed that foreign private investment (US$37.5 billion) comprised 77% of the CBC portfolio, with domestic private investment accounting for the remaining 23% (US$11.2 billion).  The outlook was totally different six years ago.  In 2018, only 45% of the projects listed in the report involved foreign capital, with domestic capital representing 55%.

The amount associated with projects involving foreign capital increased by 24% relative to the first quarter (US$30.1 billion).  The most significant growth was in the energy and mining sectors, which jointly accounted for over 70% of the total growth.

Economy Minister Nicolás Grau explained, “This is certainly good news because it shows we can convert the international interest we see in presidential tours into investment, which translates into more employment and economic growth.”

Meanwhile, InvestChile Director Karla Flores noted that the figures align with the percentages of foreign investment in Chile’s GDP, which is considerably higher than in other Latin American economies, as well as with the high FDI flows recorded in recent years.

“We are talking about companies taking on projects with development timelines of many years, even decades.  These companies have analyzed aspects where Chile has clear strengths: institutional soundness, robust fiscal responsibility and macroeconomic management, legal certainty and, of course, opportunities in high-potential sectors.  While Chile, like other economies worldwide,  has faced challenges, our country has demonstrated its ability to resolve them through its institutions in an orderly manner, which is highly valued.  The day-to-day and local debate often diverts domestic attention from the great investment opportunities Chile offers, which foreign companies do see.  Foreign investment is a powerful development tool for Chile, and everything indicates it will continue to be,” said Flores.

Number and status of projects

In addition to the amounts, the number of projects involving foreign investment is worth highlighting.  In the second quarter, 221 such projects were recorded, including 22 new projects and 16 that went from being classified as ‘without a timeline’ to ‘with a timeline,’ a transition that involves a precise disbursement timeline.  Overall, 38 projects largely account for the increase of more than US$7.3 billion.

Since projects that are farther along are more likely to materialize, the status of the projects involving these amounts is another important consideration.  Note that 70% of the amounts listed are in the construction or detailed engineering stages, lending greater certainty regarding their completion.  Projects in these two stages comprise a total of US$27 billion.

In addition to project status, the environmental status of the projects involving the aforementioned amounts is noteworthy: 56% (over US$20 billion) comes from projects that have already received environmental approval.  Projects awaiting environmental qualification, i.e., those already under analysis, involve approximately US$8 billion and represent 21% of the total.  Overall, 76% of the projects have begun the environmental evaluation system and have either received approval or are awaiting qualification.