Photo: Wikimedia Commons.
Chile has witnessed a marked growth in the presence of China among the Chilean business sector over the last seven years, registering a growth of 1,300%, according to a new study.
This has been driven by a series of significant investments in various sectors, with a particular focus on mining and energy. Notable examples include the acquisition of Chilean energy company Chilquinta by State Grid International Development Limited for more than US$2 billion, as well as investments in the salmon and agricultural sectors.
The public agency InvestChile found that this growth has been particularly reflected in the participation of Chinese companies in concession and bidding processes, demonstrating competitive integration in various economic areas. The transformation of the Chinese investor profile also stands out, having evolved from a more personal approach to institutional investments by state-owned and private companies.
Despite this growth, Chinese investors face cultural and logistical challenges in Chile, such as differences in negotiation styles and geographical distance. However, economic relations between China and Chile have strengthened over time, especially with China’s implementation of the Belt and Road initiative, which seeks to promote global economic connectivity.
In addition to investments in sectors such as mining, energy, agriculture and salmon farming, the incursion of Chinese banks in Chile is also of note, with the arrival of entities such as China Construction Bank and the Bank of China. These investments have generated significant economic growth in Chile and have strengthened trade relations between the two countries.
However, the growth of Chinese influence also poses challenges, such as concerns about Chile’s over-reliance on a single market and potential associated economic risks. In addition, there are concerns about the political and human rights implications of Chinese investments, especially in relation to repression in Xinjiang and Hong Kong.
Additionally, according to a study conducted by the Center for Analysis for Democracy (CAD) and Freedom House, Chile is the Latin American country most influenced by the Chines state’s media strategy and propaganda. According to the study, Chile has seen markedly high levels of Chinese influence in its media, along with a remarkable resilience and community response. A greater distrust of Chinese media was also observed.
Despite these challenges, China remains an important player in the Chilean economy and its presence continues to grow, especially with initiatives such as the Belt and Road. As trade relations between China and Chile continue to evolve, new challenges and opportunities are likely to be faced in the future, which will require a strategic approach by both nations to ensure mutual benefits and sustainable development.
Main source:
La fuerza del “dragón”: China sube 1.300% su presencia en los negocios chilenos en apenas 7 años (2024, marzo 31).
https://www-biobiochile-cl.cdn.ampproject.org/v/s/www.biobiochile.cl/especial/bbcl-investiga/noticias/articulos/2024/03/31/amp/la-fuerza-del-dragon-china-sube-1-300-su-presencia-en-los-negocios-chilenos-en-apenas-7-anos.shtml?amp_js_v=0.1&_gsa=1#webview=1&cap=swipe
Other related sources:
BBCL, (31de marzo, 2024)
https://www.biobiochile.cl/especial/bbcl-investiga/noticias/articulos/2024/03/31/la-fuerza-del-dragon-china-sube-1-300-su-presencia-en-los-negocios-chilenos-en-apenas-7-anos.shtml