• According to InvestChile analysis, the cumulative FDI figure was the second highest since 2015 and equity capital – fresh funding entering the economy – was at a record high.

The Chilean Central Bank released foreign direct investment (FDI) data for January to December 2023, showing a total cumulative flow of US$ 20.4 billion – up US$1.1 billion from November of the same year. According to InvestChile analysis, the figure is the second highest since 2015, surpassed only by the US$ 20.8 billion recorded in 2022, and 24% higher than the average for the last five years (US$ 16.4 billion).

The 2023 FDI figure was down 2.4% from the 2022 record.

Equity capital, representing fresh funds entering the economy, was the largest component of cumulative FDI flow (US$11.5 billion) and the highest since 2003 (see graph). Reinvested earnings came in second place, with a cumulative figure of US$8.9 billion. Debt instruments, meanwhile, recorded a negative flow of US$47 million.

Importantly, the FDI figures released this week are provisional and will be reviewed by the Central Bank on March 18.

Significant FDI flows in Chile

InvestChile Director Karla Flores pointed out that the latest FDI figures reflect international investors seeing Chile as an attractive place to invest, which translates into significant foreign investment flows. “The 2023 foreign investment figure of more than US$ 20 billion is among the highest in the last twenty years. It confirms that Chile remains competitive within the region when it comes to attracting foreign investment and that the country has managed to extend its recent track record of high foreign direct investment. All this in a context where foreign direct investment flows in developing economies fell by 9%, according to UNCTAD, due to economic uncertainty and higher global interest rates, making 2023 a particularly challenging year for attracting investment,” said Flores.