Chile

History & Background

The Republic of Chile is to the north of Peru, to the northeast with Bolivia, to the east with Argentina (separated by the Andes that forms a natural border), and to the west with the Pacific Ocean. Its geographical location offers a variety of climates. A small area of the extreme north of the country is semi-tropical, immediately followed to the south by a harsh desert extension (Atacama Desert), considered one of the most arid areas of the planet. Benjamin Subercaseaux, national writer and scholar, described the topographic territory as Chile o una Loca Geografía (Chile, a Geographic Extravaganza), in his book of the same title, referring to its vast variation of climates.

The country occupies an area of 756,950 square kilometers that includes island possessions (292,132 square miles) and 1,250,000 square kilometers (482,628 square miles) of claimed sovereignty of Chilean Antarctic territory, located between 53 and 90 longitudinal degrees West of Greenwich. The latter is mainly populated by military personnel and few civilian families, 1,200 individuals live year round in four permanent bases. Twelve summer bases open for a period of 4 months where national and international scientists, maintenance, and logistic support personnel triplicate its population. Additionally, two laboratories, one of cosmic radiation and one of marine sciences occupy the Chilean Antarctic zone.

Industry/manufacturing contributes 20.8 percent of the country's labor force. During the last twenty years, Chile has promoted exportations of non traditional products, processed and canned food, and manufactured goods, and has expanded the markets of its most traditional ones (wine and iron steel among others.) More recently, tourism has been stimulated as another income source to the country increasing the national gross domestic product.

Chile is a republic where the president is democratically elected by direct vote. The official language is Spanish; Chileans, though, refer to it as Castellano (Castilian.)

Chile's population in the year 2000 was 15,153,797 people. Its major population concentration is found in the capital city, Santiago (5,400,000 people). The national population density is 52 persons per square mile.

In terms of religion, Chileans who declare to be Roman Catholic are 76.6 percent, protestant 13.2, atheist 7 percent, and 4.2 percent other (including Jewish, Muslim, and Orthodox.)

According to the 1992 national census, Chileans who declared to be mestizo (European and native Indian mix) were 66 percent of the population, European descent 25 percent, Indigenous 7 percent, and other 2 percent. As compared to other regions in the Americas, slavery from Africa was scarce, particularly because plantations were not developed due to the climate and because importing slaves was not profitable considering the long distance to sail. For this reason, slavery was limited to few local natives and was abolished during the early years of the country's independence.

Currently, these are the main native ethnic groups that survived the Spanish conquest. The Aymara is a group that populates the northernmost geographical area of Chile, corresponding to the Altiplane, a highland territory shared by Chile, Argentina, Peru, Bolivia, and Ecuador located in the Andean zone. The Pascuense is a Polynesian group that inhabits the Rapa Nui/Isla de Pascua (Eastern Island), located across the Chilean coast that was annexed to Chile in 1888. The Mapuches, also called Araucanians, are the most numerous ethnic group with approximately 500,000 members who originally concentrated in the southern territory of the country.

Of all groups, the most racially intact is the Eastern Islanders, approximately 3,800 kilometers west away from the coast of Chile; foreign access is difficult so its mixture is rare. Mapuches (Men of land) are recognized as the most significant numeric minority of the country.

As in most territories in the Americas, Spanish exterminated natives in pursuit of land claimed in name of the crown. In a more contemporary context, assimilation, on the other hand, including formal education, military service, and other national activities have not permitted the maintenance of traditions acculturating aboriginal groups, in some cases to their extinction.

As the Chilean territory expanded to the south, few nationals demonstrated interest to inhabit the areas of hostile climate. Due to this reason, the Chilean government invited Italians and Germans to populate a vast region of the country. Germans created a number of prosperous cities, including Valdivia, Puerto Montt, and Puerto Varas, as a result of this colonization. Apart from developing agriculture, they also developed new industries in the area and incorporated their traditions to the national culture. They expanded the territory by settling with their families in inhospitable zones for Chileans, founding Osorno and Punta Arenas. Despite the government efforts, few immigrants came to Chile compared to other countries in the Americas such as Argentina, Peru, Mexico, and Brazil. The Spanish tradition and culture predominated up to after the independence when French enlightenment and encyclopedist philosophies captivated Chilean founder fathers.

Constitutional & Legal Foundations

The Primera Junta Nacional de Gobierno (First National Government Junta), under the initiative of nine Creoles, organized the first government in 1810 by calling the people to join the first town council. The most important contributions that created the nation were to make economic decisions to develop commerce with adjacent territories and to call to form the first national congress in 1811.

Once the first congress was established, the Appealing and the Supreme Judiciary Tribunal were organized. However, the Congress' magnum contribution, in terms of justice and legislation, was to abolish slavery and to establish libertad de vientre (freedom of birth); this decision made Chile the third country in the world that eliminated such practice.

The first Provisional Constitution of 1812 was formed by 28 articles. Among them, the most important article declared the king of Spain a symbolic figure with no legal or political power over the Chilean territory.

A series of wars followed the political movement and kept the monarchic Spain rejecting the idea of losing the territory. The Constitution of 1818 broke the last ties with Spain, eliminating nobility titles that were granted by the monarchy to subjects born in Chile. This regulation was the first step towards a more egalitarian society.

The Constitution of 1828 contributed significantly to the separation of state from the church. The religious orders in the country lost their privileges, acquiring organizational status as many other secular ones, their extensive land properties were partially confiscated, and taxes were imposed by the government on the properties they conserved.

The most solid Chilean Constitution was that of 1833. It was in force for over ninety years. The authors of this constitution were a group of jurists, scholars, and intellectuals whose dedication organized the government of the country systematizing and articulating many aspects in detail.

The Constitution of 1925 was elaborated during a period of power struggle between civilians and the military. This time, the Comisión Consultiva (Advisory Committee) represented by different political parties and institutions was in charge of writing the document. The separation of state from church and social protection and welfare to all citizens were stipulated among many other contributions to solidify a democratic nation.

The Constitution of 1980 was promulgated under the dictatorial government of General Pinochet. His reign was an era characterized by increasing the budget for defense while reducing it for social welfare and education. This regime has been well known for the interference with educators and educational institutions such as universities, and other centers. Public education suffered the most serious deterioration of the century. As a consequence of declaring secondary and higher education a "situation of privilege" and contrary to the precept of universal education, dropout rates dramatically raised, inversely, performance and retention dropped in the country.

The three elected presidents who succeeded the dictatorship have been experienced politicians who in an agreement with a coalition of parties advocated to recover education in all its aspects as well as social benefits for the constituents. Former presidents Aylwin and Frei Ruiz-Tagle represented Christian Democrats, while President Lagos became the second socialist elected president in the history of Chile. These three governments have exercised moderation in their missions and have recovered respect in the international context lost during the dictatorship.

Educational System—Overview

Previous to the independence, Christian religious orders predominantly influenced Chilean education. In fact, Jesuits founded the first educational institutions in the country. Since the Primera Junta Nacional de Gobierno (First National Government Junta) in 1810 there was interest on developing educational systems in the new country manifested by the independentist movement members. This desire was concretized by an approved decree that specifically waived taxes for a year and a half on books, maps, printers, physics instruments and machinery that contributed to social and educational advancement. Based on this predisposition to facilitate education, during the year 1813 the National Library was created, freedom of press was instituted, and the first official government newspaper, El Monitor Araucano, was established.

These efforts though were consolidated only partially due to prioritization of needs. Solidifying Chilean independence, as well as continuous wars related to territorial limits with adjacent countries, delayed the establishment of public education at a national level that covered all social strata.

From the conquest, late 1500s, to the early periods of the independence, the 1800s, education was in the hands of Catholic organizations. Churches, where reading and writing were taught, had as a main objective evangelizing and gaining new Christians raised in the faith. Additionally, education was highly stratified, it was intended for members of traditional Spanish families, and later, for aristocrats who formed the national elite. Equally, education was emphasized for men who were expected to hold political positions and play roles of leadership for the nation.

Following the Spanish colonial pattern at the time in the Americas, priests were predominantly scholars. The Aurora de Chile, (The Chilean Sunrise) the first Chilean newspaper was created and edited by Camilo Enriquez, a catholic priest, patriot, and man of letters who was deeply influenced by the ideas of Jean Jacques Rousseau. Other Europeans influenced Chilean early educational models. The German educator Friedrich Froebel, the father of kindergarten, and the Swiss educational reformer Johann Heinrich Pestalozzi, whose interest in creating schools for the poor and the new didactic for elementary education influenced the development of Chilean education that likewise was reflected on teaching training.

Tradition, on the other hand, predominated over law, educational institutions were created mainly for boys, as in the case of secondary education. Equally, from a professional point of view, girls' access to education was also limited. Only twelve years after the first normal school was opened for males, the first school for girls of this type was created.

It was not until the beginning of the 20th century when drastic and moderate educational reforms solidified public education in the country mainly motivated by political movements and social force led by labor unions.

In 1927, the Ministry of Education was created, having as a main role to plan, implement, and enforce educational laws and oversee the conditions of education at a national level. With the exception of some short periods of time, its administration was characterized by offering centralized policies that favored uniform curricula nationwide including content, providing text books, and basic school supplies free of charge for elementary education. This policy favored relocation of families along the country making education transition easy for children to readapt to new schools on different geographical areas of the nation for decades.

Curricular flexibility began to be attained at the end of the second decade of the 20th century, when advances in education were conducted and partially accomplished by radical laws. Nevertheless, due to political turns, a promising educational system was abruptly ended.

Chilean education adopted a great degree of rigidity reflected on social and geographical inequalities. The most disadvantaged children were those of poor stratum who lived in rural areas where authority did not enforce matriculation and access to schools was difficult due to distance. Emphasis on education for the economically disadvantaged and rural zones of the country was given by president's E. Frei M. Christian Democratic government during the last five years of the 1960s decade when more contemporary methodologies were applied to public education or re-adopted from previous projects carried out in the 1920s and 1930s.

The school dropout rate was also a concern among policy makers. Afterstudying the situation during the 1950s, social strategies were implemented to reduce this rate by offering free nutritionally balanced breakfast and lunch to assist school-age children who fell below the poverty level and had no other significant assets. The Junta Nacional de Auxilio Escolar y Becas or JNAEB National Council for School Aid and Scholarships) was created to assess social needs that could prevent children from abandoning school prematurely. Low-income children were also provided with regular access to health and dental care and treatments, if required, free of charge on a regular basis as referred by school authorities. Other services were developed to serve the stratum, Colonias de Veraneo (vacation summer camps) were offered to students during their summer vacations that liberated them from work and as a strategy to motivate elementary school attendance. This initiative was put in practice for the first time in 1929, but was discontinued due to political circumstances. Nevertheless, it was revived as a successful effective program in elementary education by the JNAEB. All these initiatives were implemented to reduce school inequalities and to provide equal opportunity of education.

Scholarships were offered on a competitive basis for those low-income students who demonstrated academic outstanding performance to continue their secondary education. Funds for postsecondary education were allocated in the form of scholarships that did not have to be repaid.

Until 1965, primary grades were 6 years of compulsory schooling and 6 years of optional secondary education called bachillerato or humanidades (baccalaureate/humanities). The reform of 1966 extended free elementary compulsory public education to eight years while reduced secondary grades to four, changing its name to grados de enseñanza media (high school).

Administrative decentralization began with the country geo-political regionalization in 1974. Later on, during the decade of 1980, the process of school municipalization provided more autonomy to educational institutions, while the government authorized subsidized private schools, known as escuelas subvencionadas for elementary and secondary education in the country. The Ministry of Education approved the Education Organic Constitutional Law of 1990 that authorized educational centers/institutions to develop their own curricula for elementary and secondary education.

A significant characteristic of the most recent national education reform is the extension of the school day transforming it into a single shift—whereas traditionally, most schools group children and teachers into two shifts: morning and afternoon. This new modality has been implemented since 1998. The two-shift school day supported the notion of better utilizing public school buildings by offering more courses while keeping a low student-teacher ratio. Students were given the option to attend school either in the morning or in the afternoon. The single shift schedule refers to the extension of the number of pedagogical hours students remain in school to solidify the learning process leading to expand curricular content areas: specifically, increasing weekly hours from 30 to 38 in elementary education and to 42 hours in high school.

The reform was questioned by school professionals arguing the need for more school buildings to contain all students and teachers to keep low teacher-student ratio. Existing facilities don't have the capacity to absorb the demand for education under these conditions. Aware of the magnitude of this change, gradual implementation was planned; for this purpose, the government allocated extra funds exclusively to build new school buildings as a first step. Another concern that afflicted educators and administrators was a shortage of teachers who previously worked two shifts to cope with low salaries, as compared to other professions. The new schedule load increase did not financially compensate the second shift teachers held in the previous system. This reform was not accepted by everyone in the educational system. Private school professionals argued that they lacked funds to hire teachers for longer hours, additionally, private educators argued that extending the number of hours in schools not necessarily would improve the quality of education, remarking that quality and quantity not necessarily correlated. Another argument posed by opponents was centered on traditionally under-funded zones, which ultimately led to displaced students.

Spanish has been the only language of instruction in public schools, however, one of the most recent attempts to improve education for the ethnically disadvantaged has been the incorporation of bilingual-bicultural programs. The Unidad de Cultura y Educación de la Corporación Nacional de Desarrollo Indígena or CONADI (Division of Culture and Education of the National Corporation for Indigenous Development), represented different tribes, presented in 1995 a proposal on Educación Intercultural Bilingúe in which they expressed their interest of preserving their native languages and cultures. Together with the recognition of Chilean indigenous groups by the government (Law 19.253 D of 5.10.1993) local universities where zones of high indigenous density existed had adhered to the initiative. In 1998-1999 a pilot project sponsored by the Ministry of Education, Division of Multicultural and Bilingual Education, made a national call to compile didactic material for 1st and 2nd grades on a competitive basis. This was the first initiative of this nature in the country conducive in solidifying the project.

All the reforms during the twentieth century were efforts addressed to improve education for all students. They were to establish high content and performance standards and redesign the various components of the educational system in a coordinated and coherent fashion to support and solidify students' learning and promote universal education in the country.

Examples of effective policies were reflected on the progressive literacy rate among Chileans 15 and older during the last century: from 50.0 percent in 1920, to 80.0 percent in 1952, to currently attaining 95.6 percent in 1998.

The enrollment of students in elementary education increased from 64.0 percent at the beginning of the 1960s, to 95.0 percent in the 1970s, and 98.3 percent in 1998. A mixed educational system, non-sectarian private and public, innovative in Latin America, provides parents with the option to send their children to the school of their choice, while funding is available to subsidize private schools. A national flexible free market economy has permitted Chile to allocate funds exclusively to subsidize private schools. In Chile, 93 percent of schools that serve children attending elementary and secondary education in the country are financed by the government. The central government uniformly distributes financial support paid per pupil attending school, being calculated per trimester in addition to the municipal budget assigned locally per institution.

In 1981, about 78 percent of Chilean students were registered in municipal schools as compared to 56 percent in 1996; and 15 percent of students in 1981 registered in private subsidized schools as compared to 35 percent in 1996. Private institutions have captured a stable rate (during the same periods) of approximately 10 percent of the total students nationally.

The drop out rate of 21 percent in elementary education during the 1970s was dramatically reduced to 1.5 percent in 1998 and to 5 percent in secondary education the same year.

Average schooling among Chileans in 1992 was 7.2 years, increasing to 9.9 in 1998. The average among men was 9.6 years, and was 10.6 among women. In 1998, the Ministry of Education allocated 82.7 percent of its financial resources to preschools, elementary and secondary educational systems, 16.1 percent to higher education, and 1.2 percent to cultural programs. Since 1992, The Education Quality and Equity Improvement Program of the National Ministry of Education has advocated to systematically focus on the quality of education in the country. This project has been financed with the support of the World Bank loans.

General Characteristics of the Chilean Public Education: The school calendar starts in March and ends in December. In Chile, students in elementary and secondary schools wear uniforms showing a badge that identifies the institution. The national public transportation provides reduced fares to students attending elementary, secondary, and higher education, who are properly identified with cards granted by their institutions, who need transportation at the local level. The grading system has a 1 to 7 scale, 1 being the lowest, requiring 4.0 as minimum passing grade. Repetition of grade has been the practice in the country when minimum levels of competence have not been attained by students in order to ensure assimilation of curricular content. The repetition rate in 1993 was 8 percent at municipal schools, 6 percent at subsidized schools, and 2 percent at private schools in elementary education.

The distribution of educational institutions as of 1998 was: 59.6 percent municipal schools, 28.8 percent private subsidized schools, 10.9 percent private schools, and 0.7 percent to others. The maximum teacher-student ratio of 1:45 per class has been established by the Ministry of Education.

Preprimary & Primary Education

Preschool Education: The Educación Parvularia (preschool) was developed and organized by German teachers according to their traditional model in 1911, and was known as kindergarten. However, the first program offered in the country for preschool teachers was in 1905 graduating the following year the first kindergaterianas. Later on, the Decree no. 4.156 of 1928 incorporated preschools into elementary education, as optional schooling. During this period, Chilean preschool was deeply influenced by the Montessori method. Unfortunately, due to political turnouts, this innovation was implemented for a short period of time.

In 1945 the Escuela de Educadora de Párvulos was authorized and incorporated to the University of Chile's educational programs.

Three years later, in 1948, the notion of kindergarten was readopted and authorized, nevertheless, it still remained optionally added to the elementary school curriculum. Though some were aware of the benefits this level could offer to students, economic and social conditions did not support this type of schooling as a need. Extended family (elders and siblings) had traditionally preserved culture, and had been in charge of taking care of minors as parents were away for work. At the time, additionally, women had not massively participated in the labor force, and there was reticence from the part of mothers to separate their children at early ages from home. The aim at creating habits of independence and readiness for curricular elementary education has been more fully understood by the population in contemporary times, yet preschool is not part of the national compulsory education.

The objective of preschools in Chile concentrates on cognitive, language, psychomotor and affective development pertinent to educate well balanced citizens.

Educación parvularia or educación preíescolar assists pupils from 84-days-old up to 5-years-old. This type of education is supervised by Junta Nacional de Jardines Infantiles (National Council of Child Care Centers), an organization of the Ministry of Education, and the Fundación Nacional para el Desarrollo Integral del Menor referred to as INTEGRA (National Foundation for the Integral Child Development), an organization depending from the Ministry of Interior. It has been observed that as women integrate into the national labor force and the composition of the family changes, preschools have become a necessity. To 1990, about 20 percent of children up to 6-years-old attended preschool, eight years later the percentage raised to 30 percent (1998.)

Elementary Education: The first attempt for the creation of a national educational system in Chile took place in 1813, when the Junta de Gobierno decreed the creation of escuelas de primeras letras (schools of first letters) in cities and towns having a population of 50 or more individuals. These schools had to be administered by the correspondent local municipalities and the education had to be offered free of charge. This initiative turned the country into the education pioneer in the Latin American context. Nevertheless, this resolution was only partially carried out due to the lack of infrastructure, government supervision, and political instability in the country. At the time, most free education was in the hands of the Catholic church. Conflicts with the church dealing with the freedom of teaching prolonged for decades, getting intensified during 1870s. In 1882, Monsignor Celestino del Frate was sent by the Vatican on special assignment to solve the conflict, but agreement between the two parties was never fruitful, the Papal dignitary was declared persona non grata, and subsequently, expelled from the country by the Chilean government. This situation precipitated the approval of Leyes Laicas (lay laws) between 1883-1984 and the expansion of non-sectarian schools.

Elementary education began expanding vigorously to rural zones during the first decade of the twentiethth century (1906) gaining solidification in 1920 when the Ley de Instrucción Primaria Obligatoria (compulsory primary instruction law) was promulgated, put in effect, and enforced.

Historical Framework: During the decades of 1920 and 1930 varied innovations were carried out in public education in the country. Collaborative projects with foreign education experts and political leaders introduced significant new pedagogical models and methodologies to public education.

The Supreme Decree of December 1927 introduced revolutionary changes in the national educational school system's exemplary for the other nations in Latin America. Educators opened themselves up to new psycho-pedagogical models recognizing the integral development of children as a function proper and inherent to the Ministry of Public Education.

Highly influenced by Decroly, Montessori, and Parkhurst, the passive lecture school was transformed into an active laboratory where children could freely express their innate interests. This movement known as la escuela nueva (new school), was characterized by the how focusing on the methodological processes and comprehension rather than on the how much or memorization of facts. Whole language was introduced in the language arts as parallel to phonics.

Though educational change was greatly influenced by Europeans, the purpose was to integrate new theories in a framework that recognized characteristics that were unique to the Chilean fabric by incorporating German postulates known as Heimatkunde. To implement this principle, schools were divided into rural (co-educational), urban, farm, and boarding schools (having a family regime created for orphan students and pupils who lived at a distance inappropriate to attend school daily.)

Though emphasis was centered on elementary education based on the promulgation of Primary Education General Regulations, secondary schools and adult education benefited and dramatically improved.

Provincial Education Councils oversaw the participation of land owners who agreed to donate land to create schools in the regions, while industrial zones' participation was requested to implement adult and regular public education. In both cases when mandates were violated the government fined the responsible party.

In 1928, two new educational systems were adopted in the country: escuelas experimentales (experimental schools) and escuelas modelo (model schools). Innovative experimental schools were instituted in Chile in 1928, the second country in the world where they were adopted, after Italy where they were created in 1923.

Two types of experimental schools were incorporated: the limited schools where a foreign specific plan or program had to be tested in a Chilean context; and broad schools where a variety of methods had to be tested previous to their adoption. Model schools, on the other hand, had to adopt methods and plans that were already tested by experimental schools. Rural schools were envisioned as temporary, which objective was to be turned into regular schools after certain standards were achieved.

The coeducational system was introduced partially for preschoolers, first and second graders, and rural schools.

Binet, Simon, and Dearburn Psychological tests were incorporated into schools to offer schooling appropriate to the pupils' needs. Unfortunately, and due to political conflict, the ideal school system that had begun to be implemented so successfully was abruptly ended by Ibañez's government, 1929-1930, declaring teachers revolutionaries. Chilean education suffered deterioration, offering minimum opportunities to students by reinstating archaic systems. Nevertheless, extensive systematic documentation on the adoption and assessment of these innovative programs was collected that not only became historical documentation, but educational material for the coming generations.

The creation of the Junta Nacional de Auxilio Escolar y Becas (national council for school aid and scholarships) in 1953, started programs in public schools that were two folded: to indirectly contribute to poor family income and to motivate students to remain in school and reduce dropout rate.

A more populist movement began during the decade of 1960, governments that concentrated on educating agrarian workers. The reform was influenced by the Christian Democrat party guided by a religious doctrine that reconciled church and state as participant forces with a common objective—education for the poor. Though elementary education continued having adequate support, the objective was to expand what had been accomplished searching for an articulation of elementary and secondary levels. The idea of experimental schools was retaken, nevertheless, it was applied to secondary education, that had remained traditional for almost a century requiring modernization to expand serving the national population.

The influence of Paolo Freire's teaching methodology contributed to the emphasis given to adult education during the presidencies of E. Frei, (1964-1970) and particularly S. Allende (1970-1973). Previous to this time, adult education had had no notable advancement for half a century.

The Pinochet era, in terms of education, is known for its reduction of educational funds from the national budget and its increase to defense. The development of subsidized non-sectarian schools imposed a new conception of schooling, which at the same time contributed to reduce the government expenditures opening to school privatization. The reduction of educational expenditures was systematic between the years 1975 and 1990. It was a phenomenon opposed to what was happening in democratic countries where priority to education predominated. The financial framework contributed to the deterioration of education in Chile.

Since 1988, the Sistema de Medición de la Calidad de la Educación or SIMCE, (Education Quality Measurement System) has been applied to all elementary schools in the country. Tests are given to fourth and eighth graders alternatively every other year to assess academic performance of students in the areas of Spanish and mathematics. It has been argued that variables such as family income, geographical residence, and the system to which students attend (private versus public schools) have an impact on the results. Due to these circumstances, and based on scores revealed by the instrument, the Ministry of Education has developed a number of projects to cover the needs of the populations who traditionally score low.

Since 1990, a special program known as P-900 offers extra infrastructure and economic support to 900 schools that show the lowest scores at the national level, has been implemented. Simultaneously, Talleres de Aprendizaje or TAPs (learning workshops), have been developed to offer remedial education to at-risk students at the elementary education level. These workshops meet twice a week beyond the regular school schedule, and are monitored by high school graduates trained for the purpose.

Additionally, Rural Programs in the Escuelas Multigrado Incompletas (multigrade incomplete schools) that house children of varied ages at different school levels, offer from preschool to secondary education according to the zone demand, have been created.

Special Education: Special education schools were created by European expert educators who were hired by the public education ministry to incorporate the most advanced techniques for the different needs during the decade of 1920. The school for the deaf located in Santiago, for example, was developed by Belgians whose global method of demutation was the most advanced in the world; at the time, Chile became the first foreign country to adopt the method.

Special education was an active part of the Compulsory Primary Instruction Law and the 1928 educational reform that incorporated new methodological practices. Besides, the deaf schools, schools for the blind, and for the mental deficient were expanded. Psychology clinics articulated their functions with the new pedagogy, training teachers to understand and apply psychological testing that was newly adopted (Meyers, Gooddeaugh, and Binet-Simon.)

Special education offers study programs to students between 2- and 24-years-old, at three levels: preschool, elementary, and vocational. The curricula of studies are directly approved by the Ministry of Education.

Two modalities of special education are offered in Chile: Educación Especial in special schools and Differential Groups to students who attend traditional schools. The former is imparted by highly specialized professionals in schools offering programs designed for particular purposes attending the needs of children who suffer from: mental deficiencies, visual, hearing or language deficit, motor skills and relation, and communication impediments as diagnosed by professionals through certified organisms. The latter is offered as parallel programs in regular schools assisted by psycho-pedagogues to students who have learning deficiencies related to reading and writing affecting literacy and/or numeracy. Normal intelligence should be demonstrated through testing in order to be included in this category.

Private Education: Two types of private schools offer education in Chile. Non-sectarian schools, which demonstrate special interests such as bi-national schools where the primary language of instruction is not Spanish are offered. These schools were originally created in Chile to keep tradition and language alive among immigrants. Later on, these schools became popular among students whose interest is to fluently learn another language and culture. The main method of instruction is bilingual education where total immersion is applied. A second type of private education is imparted by religious schools run by religious congregations. A percentage of these schools also offer international education and bilingual instruction. Private religious schools are viewed by people as rigid systems, where respect and classic traditional education is maintained.

Reforms have not negatively affected private enrollment, to the contrary, during the last fifty years private education has raised its relatively high stable enrollments. The current percentage of Chilean children aged 4 to 18 registered in private education is of 10 percent.

Secondary Education: Chilean history recognizes Seminario de Santiago as the first secondary institution funded in 1608 in the territory. However, this religious institution graduated priests exclusively.

The first secondary school not having the sole purpose of graduating priests was the Convictorio de San Francisco Javier, a religious Jesuit institution intended for the upper class of Spanish lineage during the early colonial period. This school was closed when the Jesuit order was expelled by the Spanish king from his territories in 1767. While colonial education was scarce, the kingdom authorized a second secondary institution during the same year, the Convictorio Carolino, recognizing the need for educating Spaniards who lived out of the Iberian Peninsula. All these institutions were boarding schools. Other secondary schools were created during the last two decades of the century and early 1800s, though all of them were regented by the clergy.

The first secondary public institution was created by the Junta de Gobierno of 1813, August 10, in Santiago. The initiative unified four previously private secondary schools, Convictorio Carolino, Academia de San Luis, the Seminar, and the division of education of the Real Universidad de San Felipe to create the Instituto Nacional. The newly created institution turned into the most prestigious national secondary school for males.

The creation of secondary education in the country was originally aimed at attending universities. Based on the rigid encyclopedist model, secondary education was predominantly authoritarian offering a rigid curriculum reflecting the European models, particularly the French one. Reflecting this European influence, secondary education has been referred to as liceo (lyceum) in the country. The first private secondary school for girls was created in 1823, and the first public institution in 1891 in the city of Valparaíso.

The new century brought national political radical movimientos gremiales (labor unions), urbanization, and industrialization leading towards democratization and influencing the adoption and modification of new pedagogical theories predominant in Europe. These conditions offered the ideal framework to create experimental secondary schools where theoretical models could be applied and tested, and at the same time, to serve as professional development for pre-service teachers. Experimental schools were administered by pedagogical institutes that were well known at the time as professional innovators.

The year when the Ministry of Education was created, 1927, the government transferred the administration of secondary education from the university to the officially recently created Ministry. During this period, for the first time the concept of technical-professional education was incorporated in a modality proposed as liceo integral in 1928, where humanistic tradition was viewed as different from the productive reality of the country in a first effort to implement it.

The last two years of general Carlos Ibáñez del Campo reign in power (1930-31) were particularly repressive against unionized educators who had played a preponderant role in the national pedagogical advancement. Schools were closed, the systems partially abolished, and teachers incarcerated—accused of provoking civil disobedience.

In 1940, the escuelas consolidadas were specifically developed in rural areas or urban poor neighborhoods to attend the needs of a growing population to continue their education. The post war movement influenced Chilean education creating technical-professional training as an alternative to the traditionally humanistic secondary education that to the time predominated as a model. Unfortunately, the nitrite crisis impacted greatly Chilean economy, obligating the government to reduce public expenditures.

New economical stability in the country during the 1960s permitted the government to expand education to certain sectors. The population growth demanded a system that required new facilities, hence the instauration of escuelas completas provided the possibility to continue education for 12 or 13 years at the same public institution.

Upgrading elementary education to 8 years required restructuring the secondary educational system. As secondary education was reduced to four years, it was strictly necessary to reallocate funds to optimize its infrastructure.

Preparatory Secondary Education: Secondary education remains characterized by a tracking system based on abilities and goals that prepare students to continue studies in higher education. Core classes are offered as common plan for the first two years; while the last two years emphasize either scientific or humanistic content to better prepare students for higher education within the disciplines they have chosen.

The Academic Aptitude Test is a standardized exam offered nationally and simultaneously to all students during the last semester of the twelfth grade. The Prueba de Aptitud Académica (PAA) was administered for the first time in 1970. This is the culmination of secondary education requirements.

Private school students obtain better scores than public school attendees. This fact has been observed as discriminatory from the part of some sectors conducive to fill vacancies to register in higher education institutions reserved for the best students. On the other hand, those who support this process of selection claim that due to the limited resources of the country, authorities cannot afford to open universities for everyone, hence, higher education institutions have to search for predictors reliable to ensure graduating students who respond to more rigorous curricular demands than those expected in secondary education.

The process of pre-selecting students to attend higher education begins with the publication of Listas de Selección (score lists), which are of public domain. The PAA's scores (verbal, math, and specific knowledge in the areas of history and geography of Chile, biology, social sciences, physics, mathematics, and chemistry) are currently published by the newspaper La Nación, the third Sunday of January every year.

Higher education institutions have the right to pre-establish a cap, which limits the number of students admitted to a competitive selection. Grades, and/or additional tests of pre-selection including, in some cases personal characteristics established as compatible with the profession, are additional requirements to apply to some professions.

In 1970, about 49.0 percent of Chilean adolescents attended secondary schools as compared to 75.0 percent in 1989, and 81.8 in 1998. As of 1998, the retention rate was 87.1 percent, the repetition rate 7.9 percent, and the dropout rate was 5.0 percent. By 1995, about 58 percent of secondary students attended the scientific-humanistic modality in the country.

Secondary Technical-Professional Schools: The first secondary technical institution recognized in the territory was the Academia de San Luis, founded in 1797. This modality though scarce, as most institutions during the colonial times, was also regented by religious organizations.

Between 1939 and 1941, there was strong support from the part of the government as well as from the part of Chileans en general to promote and establish Educación Técnico-Profesional, an educational modality directed at inserting secondary graduates into the labor force having specific skills received systematically though a well articulated curriculum, activities and assessment. People perceived this modality, from the beginning, as practical, particularly by those sectors where apprenticeship had been a tradition, and who had not contemplated higher education. This new education was accepted as a way of stepping up in socioeconomic terms.

Focusing on different specific purposes, the most common types were commercial schools, industrial, agricultural, and vocational for girls.

This modality, that had gained many adepts until Allende's government, attained 36 percent of secondary students in the country. Matriculation in secondary technical-professional schools was dramatically reduced to 19 percent as a result of the policies applied by the military educational reform directly affecting popular classes. The educational reform of 1980, changed their traditional names to Liceos técnico-profesional. During the period, more than 50 percent of these schools were transferred to private companies for their administration to reduce government's expenditures in education in addition to their municipalization. Privatization was adjudicated by means of contracts regulated by the Ministry of Education.

As a result of allocating extra funds from the part of the democratic government, matriculation in secondary technical-professional recovered to 35 percent in 1990 to reach 42 percent in 1995. The repetition and dropout rates in this modality have been higher than in scientific-humanistic schools during the 1990s, reaching an average of 12 and 7.5 percent. In 1999, industrial and commercial schools have been the most frequented by students, 43 and 36 percent, respectively.

Adult Elementary & Secondary Education: The reform of 1928 incorporated evening and night schools for adults. They were organized in two categories: de alfabetización (for literacy) and escuelas complementarias (complementary schools) designed for adults of both sexes to give them the opportunity to begin or continue their studies while working. The main innovation introduced by this reform was turning the school into a center that bridged students and the labor market. This objective included looking for contracts that satisfied students' interests while matching their training.

From 1965, the Christian Democrat government centered its interest on agrarian reforms. The government created centers to organize peasantry to receive land that was confiscated from owners who did not work it. As an extension, the government adopted the responsibility to educate new farm workers to become autonomous. Organizations such as Corporación de la Reforma Agraria, (Corporation for the Agrarian Reform), Instituto Nacional de Capacitación (Training National Institute), Consejo Nacional de Promoción Popular (National Popular Promotion Council), and Servicio de Cooperación Técnica (Service for Technical Cooperation) among many others promoted cooperativism, peers support and mainly education, from literacy courses to technical agrarian training.

Some sectors adopted for adult literacy education in the country a new method developed by Brazilian educator Paolo Freire that focused on social participation known as education for liberation. The Church adhered to the cause, though separated from the political forces that involved ideology, contributed to educating disenfranchised classes. These innovations were implemented during the complete Christian Democratic presidential period (6 years.) Legislation on adult education systematized, articulated (between elementary and secondary adult education) and organized schools into educación vespertina (evening education) and nocturna (night school) utilizing public infra structure destined originally for elementary and secondary children education. For the first time, public buildings were used to their maximum capacity.

To the year 2000, public Adult Education serves persons of all ages from 15 years and over free of charge at a national level. These students obtain the same benefit school children have regarding reduce fares on public transportation to facilitate attending schools. In addition, the Centros de Educación Integrada de Adultos or CEIA (Adult Integrated Education Centers) offer classes to stop-outs, of the ages established by the law, also during the day.

The first Chilean University was founded August 19, 1622. Governed by Dominican priests, the Santo Tom s de Aquino University's curriculum was mainly directed, as most universities at the time, at theological studies conducive to clergy and sacerdotal professions, including the arts, at the levels of baccalaureate, master, and doctoral degrees. The curriculum was organized as trivium or cuadrivium, according to the conservative scholastic tradition. The former incorporated grammar, logic and rhetoric, while the latter included geometry, music, mathematics, and astronomy.

After a century, and due to political circumstances, Phillip V, king of Spain, authorized on July 28, 1738, a teaching and cloister university, named in his honor Real Universidad de San Felipe. As compared to the first higher education institution, the new one expanded its studies to law, medicine, and mathematics, as its counterparts located in other viceroyalties in the Americas (Peru and Mexico) and Salamanca, Spain.

The foundation of the Universidad de Chile took place in 1842. This institution partially incorporated the disciplines offered by the Universidad de San Felipe when by law the nobility titles were banned in the republic, adding disciplines that had developed to supply contemporary academic needs. This university has been historically considered a blending between the academic European tradition and the national Chilean character. The Universidad de Chile developed campuses at different national geographical locations, making it until 1988 the largest national university in the country.

The Pontificia Universidad Católica de Chile, the first private institution, was founded in 1888, governed by the Catholic Church. As well as its public counterpart, it expanded to other locations beyond the capital city where it was originally established.

The second public higher education institution was created in 1952, Universidad Técnica del Estado (UTE), offering a shorter curriculum on technical professions as compared to other universities to supply the country's needs for specialized highly trained technicians.

The Christian Democrat government of 1965 reformed the most traditional system to survive the strictness of the previous century in the country: university education. For the first time in the history of Chilean education, students and academicians could participate in the process of decision-making within the higher education system. This reform was known as the democratization movement.

Until 1980, there were eight universities in the country that had multiple campuses in different geographical areas of the national territory. Two were public, Universidad de Chile and Universidad Técnica del Estado, while all others were private. The authoritarian reform of 1981 stratified and segmented the Chilean university system. Regional branches of the two public institutions became separated independent universities (17); additionally, the government authorized the creation of private new universities (42 during the first year). The original higher education institution central offices conserved their names, with the exception of the Universidad Técnica del Estado that changed its name to Universidad de Santiago, and are currently known as traditional universities. Chilean higher education gained prestige in the Latin American context, the University of Chile and Pontificia Universidad Católica de Chile currently offer international programs in areas as varied as engineering, medicine, commerce, and education.

In 1999, there were 66 universities in Chile, and 200 other higher education institutions had been authorized. Nevertheless, during the 1990s the Ministry of Education did not accredit the 5 universities and 6 professional institutes.

Chilean Higher Education is defined as postsecondary education and is offered at three types of institutions: Universities, Professional Institutes, and Centers for Technical Formation. Traditional universities created before 1981 are subsidized by the government while those private institutions created after the reform are financed by tuitions and fees, including Professional Institutes and Centers for Technical Formation.

Alternative Higher Education: Establecimientos de Educación Superior de las Fuerzas Armadas y de Orden (Armed Forces Educational Institutions) grant technical and academic degrees adequate to their specific military functions that are equivalent to those similarly granted by regular higher education institutions offered to civilians. Institutos militares are educational institutions offering alternative higher education restricted exclusively to Chilean citizens. In Chile, even though these institutions are not affiliated to universities, but to the Ministry of Defense, they fall under the category of educational institutions granting postsecondary degrees. Therefore, they are also governed by the Ley Orgánica Constitucional de Enseñanza (Constitutional Educational Organic Law) of 1980 that establishes institutional autonomy, academic freedom, and political independence for higher education institutions.

Administration: Higher education is overseen by the Consejo Superior de Educación (Higher Education Council): an autonomous body where all areas of higher education are represented. The main functions of this council are to supervise the official accreditation of higher education institutions as established by the law, to accept or reject curricular programs proposed by the Ministry of Education, and to decide on appealing cases by elementary and secondary schools on study programs rejected by the Ministry of Education. This council is presided by the Minister of Education; three members represent the three types of higher education institutions; three members of the national scientific community are nominated by the two other national councils; one judge from the Supreme Court; and one representative of the Armed Forces Commanders. Additionally, a technical secretary is elected by the members of the council. The Rectors' Council, on the other hand, oversees the traditional eight universities and those created from their regional branches.

Budget & Finance: Historically, higher education had received stable financial government support, that had been increased according to its needs. Nevertheless, between 1970 and 1989 this budget was reduced dramatically to almost half of its original total of 30 percent assigned from a fiscal national budget to 17 percent. By privatizing institutions, the reform liberated the government from assigning financial support to practically half of these institutions. Since the political system returned to be a constitutional system, the three democratic elected governments put emphasis on increasing the fiscal budget to restore the quality of higher education. Currently, the government resources are assigned in two forms, direct and indirectly. Both are granted to traditional universities, in addition to the Institutional Development Fund, University Credit, fee scholarships, and the National Commission on Technological and Scientific Research (Comisión Nacional de Investigación Científica y Tecnológica or CONICYT). Private universities on the other hand, are limited to apply for the indirect government budget and CONICYT's. Finally, the Centros de Formación Técnica (Centers for Technical Formation) and the Institutos Profesionales (Professional Institutes) can only apply for the Indirect government budget. Of the total national budget for education, 18.1 percent is allocated to higher education.

Admission Process: Until 1966, all traditional eight universities selected their students based on a set of tests known as bachillerato. Examination commissions assigned by the Ministry of Education visited the places where students had to be tested on areas chosen by the candidates consisting of written and oral tests in humanities and sciences.

The Prueba de Aptitud Académica verbal (Spanish), mathematics, and Chilean history and geography are administered once a year. This is a standardized test required by all universities and institutions of higher education in the country. Minimum scores are set, nevertheless, other standards apply in addition to this score. Grades from secondary education, Specific Standardized tests in one or more of five disciplines offered: biology, chemistry, physics, social sciences, and math, and in some cases, internal testing (psychology tests, spatial orientation, vision and auditory, etc.) after pre-admittance to some professions and careers are also required so as to complete the application process. The process is highly competitive, as well as the retention rate based on performance of higher order skills. Traditionally, during the last century, it has been observed that two are perceived as the most prestigious universities in the country capturing students whose academic performance has been exceptional: the Universidad de Chile and the Pontificia Universidad Católica de Chile.

The length of professional studies vary according to specific curricula between 5 and 7 years. A new proposal presented to higher education in Chile suggests the incorporation of core curriculum for all university careers, increasing an additional academic year of education is currently in the process of analysis.

Cátedras (classes offered at the higher education level) are taught by catedráticos, (faculties/professor) also known as docentes (faculties), individuals whose professional preparation, advanced degree and experience, qualify them to teach classes at a higher education institution. Twelve percent of faculties hold doctoral degrees at universities in the country, which is proportional to the pyramidal educational stratification of the nation.

In addition to the core curriculum, and after approving all courses, the memoria de titulación (thesis) and a práctica profesional (practicum or supervised internship) are the last requirements for graduation for all careers, undergraduate as well as graduate degrees. The memoria is a scholarly research work relevant to the curricular specialty, within a higher educational institution, students have to write during their last year of studies. Students carry out the práctica profesional as an activity with the purpose of demonstrating articulation between relevant curricular aspects in their major and the incorporation of theory to concrete situations. These two activities vary in length from a semester to a year as established by the institutions.

Licenciaturas, magisters, and doctoral degrees are offered in the country, nevertheless, they are limited to some professions and careers, and they are limited to a reduced number of participants. Higher degrees (particularly doctorates) are limited to professionals who have demonstrated solid advancement in their careers, leadership, and commitment. These degrees are well known for their curricular demand. Magister and doctoral degrees are considered postígrado and demand to hold a baccalaureate degree; nevertheless other alternatives are offered to higher education graduates such as: postítulos, especializaciones, and actualizaciones that consist of official studies directly related to the degree held shorter in time as compared to postígrados.

In 1989, about 10.0 percent of the population between 18 and 24 years old enrolled in higher education. In 1998, from the total students enrolled in higher education, 71.2 percent attended universities, 15.3 percent attended Professional Institutes, while 13.5 percent attended Centers for Technical Formation. The higher education graduation rate in the country is of 9.1 percent, one of the lowest in Latin America.

Nominal fees according to family income are charged to students nationally. However, scholarships have increased during the democratic governments, for instance, scholarships have been offered to sons/daughters of teachers who are accepted into the teaching profession and who have demonstrated high academic performance. Low interest loans, on the other hand, have contributed to support students of low income families to attend higher education.

Educational Research: Research was very limited in Chile until 1960, when a number of programs of international cooperation were implemented. During the period previous to the military regime, research had increased in the country. The political military coupe episode of 1973 and subsequent dictatorship provoked a recess in this activity, international cooperation from all countries were discontinued, and the limited funds allocated by the government for the purpose were suspended.

As higher education was declared a "privileged situation" by the military regime, the system was intervened by the government provoking the rupture of the articulatory process of education. In the scientific areas, the phenomenon of brain drain, or exodus of scientists to foreign countries was accentuated due to the lack of resources. On the other hand, social scientists who were viewed as leftists, were prosecuted ending up on exile.

Due to repressive practices such as rectors assigned by the government, military personnel (who hadn't experienced university systems) were perceived as vigilant to the systems while researchers were perceived by non-academician military representatives as suspiciously attempting for freedom of expression. Private organizations, some under the umbrella of private higher education institutions, were able to continue conducting research particularly in the humanities and social sciences during the dictatorship. Additionally, the church and international organizations supported research dealing with controversial aspects the government did not approve sometimes acting underground.

To the year 2000, the National Commission on Technological and Scientific Research (CONICYT) administers the National Scientific and Technological Development Fund (FONDECYT) and the National Science and Technology Promotion Fund (Fondo Nacional de Fomento de Ciencia y Tecnología or FONDEF) that finance research projects on a competitive basis. Since the constitutional state was restored in the country, international cooperation has increasingly funded research at the national and international levels.

Nonformal Education

Nongovernmental organizations (ONGs) are non-profit organizations of a wide range of categories. In general terms they are services, that cover populations that are not reached by government traditional organizations. They concentrate on development, and social activism contributing to improve life quality transforming passive sectors into responsible self-supportive subjects. In Chile, most ONGs focus on poverty and disenfranchised groups. These organizations are mostly financed by private sectors, donations and volunteerism. Community projects and workshops, are directed to homemakers, young mothers, country leaders, and in general to individuals who are marginal to institutions. Religious organizations, on the other hand, have also offered informal education.

Teaching Profession

Previous to the foundation of the magisterio (educationist circle) education for the non-privileged was scarce and was the clergy domain, private schools and upper class count with individuals who were highly educated, mostly in European countries who served as tutors.

In 1842, the Escuela Normal de Preceptores (Normal Teacher School) became the first institution intended for elementary school male teachers. Normal schools at the time began as secondary education when students apart from receiving traditional education corresponding to the level, a curricular parallel pedagogical program was incorporated for five years. Those individuals who held regular secondary school diplomas could attend normal schools for two additional years to obtain the adequate training to become teachers.

The first counterpart for females, Escuela Normal de Preceptoras, was founded in 1854, replicating the standard model for normal schools already established. The foundation of the Instituto Pedagógico (Pedagogical Institute) for secondary educators in 1889 in Santiago was the corner stone for the professionalization of teachers. The institute was incorporated as part of the University of Chile known as Facultad the Filosofía, acquiring the status other professions received.

The Compulsory Primary Instruction Law of 1920 simultaneously incorporated development courses for teachers required to implement innovative pedagogical practices. To 1927, the Ministry of Education offered educational teacher exchange programs to Europe, mainly to Germany, Switzerland, Belgium, and the United States to study the most advanced teaching techniques. The educational progressive movement that incorporated into school pedagogy influenced by Dalton, Montessori, and others led by Chilean teachers became a model and the object of study for other nations that later on adopted these methodologies in Latin America.

Normal schools and tertiary teacher education institutions coexisted for decades. In fact, normal schools were supervised by universities. Since the beginning of the twentieth century, common interests between normal schools preparing elementary school teachers and universities were evident. For example, since 1929, the maximum authority of elementary education, the primary education general director was member of the national University Council.

Beginning in 1928, elementary teachers who worked for a year in public schools and satisfactorily passed an exam offered by a committee assigned by universities were granted a university diploma accrediting their profession. The teaching profession at the university level was not a mere transfer of normal programs, a modality adopted by many countries in Latin America, once students graduated from secondary schools, they continued higher education studies that added years of innovative theory pedagogical models and further foundations to the field.

The professionalization of elementary and secondary teachers was developed early nationally as compared to other countries in the region where until recently normal schools graduate students.

Normal schools were eradicated as educational institutions in 1988 by the military regime. Those who wanted to become teachers had to attend universities that were transformed into the only organisms authorized to graduate such professionals. Due to privatization, other institutions grant teaching degrees, however, on a limited basis. To 1999, some 29 institutions were accredited nationwide (18 universities & 11 professional institutes) in teacher education offering programs that vary between 9 and 10 semesters.

Due to the fact that historically salaries have jeopardized the teaching profession, objectives of the democratic governments and the Ministry of Education in order to overcome the issue have included: developing projects that provide promotions, modifying salaries on a fixed scale nationwide offering incentives for the most rural areas, where school professionals resist to go, and allocating financial resources for further professional development.

Teachers who work in elementary and secondary public schools are under the Statute of Education's Professionals (Estatuto de los Profesionales de la Educación ) approved in July 1991. According to this law, those educators who work for municipal institutions have the character of public service professionals.

Degrees offered by the universities are licenciatura, magister, and doctor in education, directed mainly to administrative positions and the continuation of higher education to those who already hold the title in pedagogy. The professional title obtained in Chile is Profesor de Estado.

Professional educators are distributed as 85 percent working in subsidized institutions whereas 15 percent work in private schools. Chilean teachers are categorized according to their areas of specialization: preschool education 7 percent, special education 3 percent, elementary education 52 percent, and secondary education 39 percent.

In-service Resources: The Center for In-service Pedagogical Training, Experimentation and Investigation was created in 1967 (Centro de Perfeccionamiento, Experimentación e Investigaciones Pedagógicas or CPEIP) to provide permanent professional development and support, test programs, and develop curricular agendas. Programas de Perfeccionamiento (development programs) are offered by the Ministry of Education or university institutions non conducive to degrees to in-service educators. These programs are equivalent to continuing education, development or formal refresher classes having the objective to update studies within the profession or discipline. When these programs are not offered at the regional level, leaders are sent to the centers representing different zones holding the responsibility to disseminate the knowledge at their local levels.

The Microcentros de Programación Pedagógica were created to provide in-service training to teachers who work in isolated areas of the country. Meeting once a month, teachers discuss school problematics related to curriculum decisions and receive technical support from techno-pedagogical supervisors from the Ministry of Education. These centers are autonomous and are organized cooperatively by their members according to their needs.

The Basic Rural Program, a sub-division of the P-900 program, has provided professional development to those teachers who are marginal from urban centers due to geographical distances. Special emphasis has been given to benefit teachers who work at multi-grade incomplete schools with a maximum of three teachers. Particular attention has been put into content areas, functionality of performance, and technology education coping with the demands of contemporary society.

One of the four components incorporated by the government into the reform of 1996 includes the fortalecimiento de la profesión docente (strengthening the teaching profession) directed to in-service teachers' development. This initiative includes: curricular up-dating; financial support for prospective teachers; pasantías, and diplomados (scholarships) to study abroad (pasantías include short exposure to professional experiences, while diplomados combine theoretical and practical studies conducive to a specialization); professional individual excellence awards; and institutional excellence awards. Additionally, the Centro de Recursos Educativos is a Web site created for teachers organized to offer curricular support.

Professional Organizations: The first educators' labor union, Asociación de Educación Nacional, was founded in 1904 joining all individuals who had interest in teaching which focus of attention was intellectual development.

The Asociación General de Profesores de Chile was created in 1923 after a strike that took place as a consequence of not receiving their salaries. This organization influenced the progressive Reforma Integral de la Enseñanza (Integral Teaching Reform) during the 1920s gaining power over educational decision makings for a decade.

Chilean teachers were well known through history as political left wing activists who represented a threat to some authoritarian governments. For this reason, labor unions were in particular historical instances suspended to be considered powerful leader organizations.

It was not until the 1950s when the Asociación de Profesores de Estado was organized by secondary educators graduated from the universities excluding those from normal schools.

The Sindicato Unico de Trabajadores de la Educación was created in 1970, grouping all sort of educators for the first time. Two years later, the organization was recognized by the state revoking a law that prohibited state workers to unionize. This union joined the Central Unica de Trabajadores, becoming one of the most powerful organizations in the history of the country. The Military junta suspended all association rights to be only recovered eighteen years later. To 2001, the Colegio de Profesores de Chile Asociación Gremial (Labor Union) is the official organization that negotiate teachers contracts and oversees professional conditions adequate to social demands for its members.

Technology in Public Education: Technology has expanded greatly during the last decade in the country, a concept that has successfully been introduced in public education. However, as resources are limited, so is technology. One of the most ambitious projects of the Ministry of Education has been the creation of the Red Educaciónal Enlaces (Links National Network) an interactive service to support students at the elementary and secondary levels. This consists of computers installed in public school facilities subscribed to the Internet that connects public schools emphasizing rural areas to reduce isolation. Fifty percent of elementary schools in the country and one hundred percent of secondary schools will participate in this project. This project is one of the components the Ministry has implemented known as Programa de Mejoramiento de la Calidad y Equidad de la Educación or MECE (Quality and Equity Education Improvement Program.)

The first distance courses offered in the country were designed for educators sponsored by universities. One of these examples is Teleduc. This service was created in 1977 by the Pontific Catholic University to develop and coordinate resources optimized by the Corporación de Televisión, channel 13, to be offered to their university and the community focusing on elementary and secondary education. The successful programs expanded rapidly, extending the service to other areas. Up to 1999, an average of 25,000 students per year register in their courses offering 32 percent in teaching development, 32 percent in general education, 10 percent in languages, 9 percent to educate women, and 17 percent in other areas. Lately, this service has expanded into international cooperation projects. Tele y Videoconferences are offered by a number of private institutions (governmental and nongovernmental) that benefit citizens at the national level.

Summary

The history of education in Latin America has revealed a high degree of vulnerability associated to political turns, to which Chile has not escaped. Nevertheless, the relative stability of democratic governments in this country has permitted to approach the solidification of elementary universal education, that has led to the expansion of a well-structured vertical education among citizens.

National experiences, radical, superficial, and profound, have shaped up current democratic governments, guiding them to exercise moderate political decisions for the implementation of new educational programs and reforms leading toward a more egalitarian society that can provide opportunities for all to reach their full potential.

In the international context, Chile has proved to be a pioneer in education among peer nations demonstrating capability to optimize limited resources. Efforts of a different nature are still to be seen: to cope with contemporary rapidly changing technology education demands and globalization without losing its identity are two arduous educational challenges for this nation.

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—Angela M. Arrey-Wastavino

CHILE

Republic of Chile

República de Chile

CAPITAL: Santiago

FLAG: The flag, adopted in 1817, consists of a lower half of red and an upper section of white, with a blue square in the upper left corner containing a five-pointed white star.

ANTHEM: Canción Nacional (National Song) beginning "Dulce Patria, recibe los votos."

MONETARY UNIT: The peso (p) of 100 centavos replaced the escudo as the nation's monetary unit in October 1975. There are coins of 1, 5, 10, 50, 100, and 500 pesos, and notes of 500, 1,000, 5,000 and 10,000 pesos. p1 = us$0.00196 (or us$1 = p511.45) as of 2005.

WEIGHTS AND MEASURES: The metric system is the legal standard, but local measures also are used.

HOLIDAYS: New Year's Day, 1 January; Labor Day, 1 May; Navy Day (Battle of Iquique), 21 May; Assumption, 15 August; Independence Day, 18 September; Army Day, 19 September; Columbus Day, 12 October; All Saints' Day, 1 November; Immaculate Conception, 8 December; Christmas, 25 December. Movable religious holidays include Good Friday and Holy Saturday.

TIME: 8 am = noon GMT.

LOCATION, SIZE, AND EXTENT

Situated along the southwestern coast of South America, Chile has an area of 756,950 sq km (292,260 sq mi). Comparatively, the area occupied by Chile is slightly smaller than twice the size of the state of Montana. A long string of land pressed between the Pacific and the towering Andes, Chile is 4,270 km (2,653 mi) long n–s; it is 356 km (221 mi) wide at its broadest point (just north of Antofagasta) and 64 km (40 mi) wide at its narrowest point, with an average width of 175 km (109 mi) e–w. It is bordered on the n by Peru, on the ne by Bolivia, on the e by Argentina, on the s by the Drake Passage, and on the w by the Pacific Ocean. At the far se, at the end of the Strait of Magellan (Estrecho de Magallanes), it has an opening to the Atlantic Ocean. Chile's boundary length (including coastline) is 12,606 km (7,833 mi).

Included in the national territory are the Juan Fernández Islands, Easter Island, and other Pacific islands. A dispute with Argentina over three small islands in the Beagle Channel almost led to war between the two countries in 1978, but papal intervention prevented hostilities. The issue was resolved peacefully by a treaty signed in the Vatican on 29 November 1984 and ratified on 2 May 1985, granting Chile sovereignty over the three islands, giving Argentina rights to waters east of the Strait of Magellan, and dividing the territorial waters south of Cape Horn between the two countries. There is another outstanding boundary problem with Bolivia over its claim for an opening to the sea. Chile also claims the Antarctic Peninsula and other areas of Antarctica, comprising 1,250,000 sq km (482,500 sq mi).

Chile's capital city, Santiago, is located in the center of the country.

TOPOGRAPHY

Chile is divided into three general topographic regions: the lofty Andean cordillera on the east; the low coastal mountains of the west; and the fertile central valley between. The Andes, occupying from one-third to the entire width of the country, stretch from the Puna de Atacama in the north, a high plateau with peaks averaging 4,600 m (15,000 ft), to middle Chile, where, on the border with Argentina, rises the highest peak in the Western Hemisphere, Aconcagua (6,960 m/22,834 ft), and then, diminishing in height, run south into the Chilean lake country, with its snowcapped volcanoes and several passes.

The region of the Andes is a seismically active area with low magnitude earthquakes occurring on a regular basis, even to about a dozen a month. Situated on the South American Tectonic Plate, the country has recorded over 100 major earthquakes (magnitude 7 or higher) since such record keeping began in 1570. On 13 June 2005, a 7.8 magnitude earthquake occurred in Tarapaca that was felt as far away as Santiago and Brasília, Brazil. At least 11 people died.

The coastal range, verging from 300 to 2,100 m (1,000 to 7,000 ft) in height, rises from the sea along most of the coast. In the extreme north, the coastal mountains join with the Andean spurs to form a series of plateaus separated by deep gorge like valleys. In the south, the valleys and the coastal range plunge into the sea and form a western archipelago; fjords reach into the range at about 42°S.

The central valley, an irregular alluvial plain 965 km (600 mi) long, 73 km (45 mi) wide at its maximum, and up to 1,200 m (4,000 ft) high, begins below the arid Atacama Desert of the north and ends at Puerto Montt in the south. Fertile between the Aconcagua and Bío-Bío rivers, this valley is the center of agriculture and of population. Although some 30 rivers rise in the Andes and descend to the Pacific, cascades and great waterfalls severely limit navigation; the ocean itself facilitates transportation between the different regions of this narrow country.

The northern side of the Strait of Magellan, part of Patagonia (a region shared by Chile and Argentina), and part of the island of western Tierra del Fuego (divided between Chile and Argentina) is low, glaciated, morainal country.

CLIMATE

Climatic zones range from the subtropical deserts in the north to the temperate rain forests of Aisén and the tundras of Magallanes in the extreme south. The cold Humboldt Current, traveling northward from the Antarctic, affects the climate of the coastal regions of central and northern Chile. Generally, however, Chile is divided into three climatic regions: (1) The north, which contains the Atacama Desert, one of the driest regions in the world, is characterized by hot and arid weather in the lowlands and occasional summer showers in the Andean highlands. (2) The middle, extending about 1,450 km (900 mi) from 30–43°s, has a Mediterranean climate, with mild, wet winters, averaging 11°c (52°f), and long, dry summers, averaging 18°c (64°f). (3) The south, a region of mountains and fjords, has high winds and heavy rains. Annual rainfall ranges from no recorded precipitation in some parts of the north to 50–100 cm (20–40 in) around Concepción, in south-central Chile, to more than 406 cm (160 in) in some southern regions. South of the Bío-Bío River, rains occur all year round. The Andean highlands, even in the tropical north, are cold and snowy.

FLORA AND FAUNA

Chile's botanical zones conform to the topographic and climatic regions. The northernmost coastal and central region is largely barren of vegetation, approaching most closely an absolute desert of any place in the world. On the slopes of the Andes, besides the scattered tola desert brush, grasses are found. The central valley is characterized by several species of cactus, the hard espinos, the Chilean pine, and the copihue, a red bell-shaped flower that is Chile's national flower. In southern Chile, south of the Bío-Bío River, heavy precipitation has produced dense forests of laurels, magnolias, and various species of conifers and beeches, which become smaller and more stunted to the south. The cold temperatures and winds of the extreme south preclude heavy forestation. Grassland is found in Atlantic Chile (in Patagonia). The Chilean flora is distinct from that of Argentina, indicating that the Andean barrier existed during its formation. Chilean species include the monkey-puzzle tree and the pine-like araucaria, also found in Australia. True pines have been introduced from the Northern Hemisphere.

Chile's geographical isolation also has restricted the immigration of faunal life, so that only a few of the many distinctive Latin American animals are found. Among the larger mammals are the puma or cougar, the llama-like guanaco, the Andean wolf, and the fox-like chilla. In the forest region, several types of marsupials and a small deer, known as the pudu, are found.

There are many species of small birds, but most of the larger common Latin American types are absent. Few freshwater fish are native, but North American trout have been successfully introduced into the Andean lakes. Owing to the vicinity of the Humboldt Current, ocean waters abound with fish and other forms of marine life, which in turn support a rich variety of waterfowl, including different penguins. Whales are abundant and some six species of seals are found in the area.

ENVIRONMENT

The principal responsibility for environmental matters is vested in the environmental programs department in the Ministry of Health and in the National Planning Office, as well as in the ecological advisory office in the Ministry of National Welfare and the department of the environment in the Ministry of Foreign Affairs.

Chile's main environmental problems are deforestation and the resulting soil erosion, and the pollution of its air, water, and land. Air pollution from industry and transportation and water pollution are especially acute in urban centers, where the population has doubled in the last 30 years. In 1996, Chile's industrial carbon dioxide emissions totaled 48.7 million metric tons. In 2000, the total of carbon dioxide emissions was 59.5 million metric tons. Untreated sewage poses the major threat to the nation's water quality. While 99% of its urban dwellers have pure drinking water, only 59% of its rural dwellers have the same access.

About 18.9% of the total land area is protected. According to a 2006 report issued by the International Union for Conservation of Nature and Natural Resources (IUCN), the number of threatened species included 22 types of mammals, 32 species of birds, 20 species of amphibians, 9 species of fish, and 40 species of plants. Endangered species in Chile included the South Andean huemul, tundra peregrine falcon, puna rhea, Chilean woodstar, ruddy-headed goose, and the green sea turtle.

POPULATION

The population of Chile in 2005 was estimated by the United Nations (UN) at 16,136,000, which placed it at number 60 in population among the 193 nations of the world. In 2005, approximately 7% of the population was over 65 years of age, with another 24% of the population under 15 years of age. There were 98 males for every 100 females in the country. According to the UN, the annual population rate of change for 2005–2010 was expected to be 1.0%, a rate the government viewed as satisfactory. The projected population for the year 2025 was 19,078,000. The overall population density was 21 per sq km (55 per sq mi); over 80% of the people live in the central region between La Serena and Concepción, although this area covers little more than a quarter of the country's area.

The UN estimated that 87% of the population lived in urban areas in 2005, and that urban areas were growing at an annual rate of 1.43%. The capital city, Santiago, had a population of 5,478,000 in that year. Other large cities and their estimated populations include Concepción, 379,860; Antofagasta, 318,779; Viña del Mar, 318,489; Temuco, 300,000; Valparaíso 276,737; Talcahuano, 250,348; and Rancagua, 206,971.

MIGRATION

After the Spanish conquest, there were three main waves of immigration: Germans during 1800–50; Spaniards, Italians, Swiss, Yugoslavs, Syrians, Jordanians, and Lebanese around 1900; and Spaniards and European Jews during the 1930s and 1940s. Since World War II, permanent immigration has been minimal.

In the years immediately preceding and after the Allende victory in 1970, about 10,000 political refugees (largely Brazilians, Bolivians, and Argentines) came to Chile. After the military coup of 1973, however, the bulk of them were expelled. The 1970s also witnessed two successive waves of Chilean emigration when, as a reaction to the Allende victory and, later, as a result of the military coup, several hundred thousand Chileans departed the country for political and economic reasons. Many of them later returned. In 1990 a National Office of Refugees was established to facilitate the reincorporation of returning exiles into Chilean society. In its first three years this office assisted more than 13,000 of the 26,000 exiles who returned in this period. In 1996, the United Nations High Commissioner for Refugees (UNHCR) office closed after 22 years of operation in Chile, as it was determined that the need for asylum for Chileans no longer existed. The net migration rate for Chile in 2005 was estimated as zero. The government viewed the migration levels as satisfactory.

In 1999, the Chilean Minister of Foreign Affairs signed a resettlement agreement for refugees from the former Yugoslavia. The project was being implemented by the Vicariate of Social (Catholic Church). As of 2004, the total refugee population in Chile numbered 654, asylum seekers numbered 85 (mainly from Colombia), and 569 were refugees. In that year there were 185,000 migrants living in Chile, 21% of whom were Peruvian.

There is a seasonal pattern of trans-Andean immigration to Argentina by Chilean agricultural workers; for many years the presence of several thousand Chilean settlers in the Argentine part of Patagonia created a minority problem.

ETHNIC GROUPS

Ethnically, the Chilean population is estimated at nearly 95% white and Mestizo (mixed white and Amerindian); 3% Amerindian; and 2% other. Mixtures between the conquering Spaniards, largely Andalusians and Basques, and the Mapuches (Araucanians) produced the principal Chilean racial type. An indigenous population of perhaps as many as 800,000 Mapuches live mainly in Temuco and in the forest region south of the Bío-Bío River. The Aymara and Diaguita groups can be found mainly in the northern desert valleys. Remnants of other small tribal groups are found on the archipelagos and islands of the extreme southern coast. A small minority of Germans and their descendants live in the Valdivia-Puerto Montt area.

LANGUAGES

Spanish is the national language. A sizable segment of Mapuche (Araucanian) Amerindians use Spanish in addition to their native tongue. The only other language of any importance is German, spoken mainly in the Valdivia region.

RELIGIONS

Roman Catholicism remains the principal religion. According to a 2002 census, about 70% of the population are at least nominally Roman Catholic. About 15% of the population describde themselves as Evangelical, a term which includes most non-Catholic churches, with the exception of Orthodox Churches, the Church of Jesus Christ of Latter-Day Saints, Seventh-Day Adventists, andJehovah's Witnesses. Other traditional Protestant denominations included Lutheran, Wesleyan, Reformed Evangelical, Presbyterian, Methodist, and Anglican. The Jewish community had about 14,976 members. Islam, Buddhism, and the Baha'i Faith were also represented. Amerindians still practice an indigenous religion involving shamanism. About 8.3% of the population claimed to be atheists or indifferent concerning religious affiliation.

Traditionally, the Roman Catholic Church has held a privileged status in the country. In 1999, however, a new law on religion, ley de culto, was adopted to allow non-Catholic churches certain rights and permissions. For instance, churches are allowed to set up affiliate organizations, such as schools and clubs, without establishing them as separate, independent corporations. Under the 1999 law, non-Catholic religious groups leaders are permitted to have chaplains in public hospitals, prisons, and military units. However, a 2004 report indicated that implementation of these laws had been somewhat lax and there were complaints of discrimination against non-Catholics in military and political employment.

TRANSPORTATION

In 2004, Chile had 6,585 km (4,096 mi) of broad and narrow gauge railways, of which narrow gauge right of way accounted for 3,754 km (2,335 mi). Rail lines in the desert area are used mainly for mineral transport. In the period 2000-03, cargo transportation by rail averaged 1.317 million ton km annually. There are five international railroads from Chile: a line to Tacna, Peru; two to La Paz, Bolivia; and two to Argentina. In 1975, the first section of a new subway was opened in Santiago; the second section was opened in 1980.

There were 79,800 km (49,588 mi) of roads in 2002, 11,012 km (6,843 mi) of which were paved. The Pan American Highway, extending 3,460 km (2,150 mi) from the Peruvian border to Puerto Montt, is Chile's principal road artery. In 2003 there were 1,373,121 passenger cars and 749,914 commercial trucks, buses, and taxis. The Carretera Austral Presidente Augusto Pinochet, a highway, is under construction in the south; when complete it will link Cochrane in Coyhaique with Puerto Montt.

Chile has some 20 ports, 10 of which are used principally for coastal shipping. Valparaíso, the principal port for Santiago, is by far the most important. Arica, Iquique, Tocopilla, Antofagasta, Coquimbo, San Antonio, Talcahuano, and Punta Arenas are other important ports. In 2005, the Chilean merchant marine had 47 vessels over 1,000 tons and a total GRT of 725,216.

Air transportation has become increasingly important. As of 2004 there were an estimated 364 airports in Chile, 72 of which had paved runways as of 2005. Santiago hosts the principal international airport, Arturo Merino. Chile's largest airline is the state-owned National Airlines of Chile (LAN-Chile), which provides both domestic and international service. LAN-Chile's only significant domestic competitor is Copper Airlines (LADECO), a privately owned company. In 2003, airlines carried 5.247 million passengers on domestic and international flights.

HISTORY

Before the Spanish conquest, several small groups of Amerindians lived in Chile. Araucanian Amerindians, who came under the influence of the Incas in the early 15th century, inhabited central and southern Chile. The conquistador Pedro de Valdivia founded Santiago in 1541, and brought Chile north of the Bío-Bío River under Spanish rule. The Araucanians resisted Spanish rule and killed Valdivia in battle. Amerindian resistance continued for 350 years, effectively barring Spanish settlement south of the Bío-Bío. The Araucanians (also known as Mapuches today) were not subjugated until the early 1880s.

During Spanish rule, Chile was subject to the viceroyalty of Peru. Later, the territory was given the status of captaincy-general and was largely administered from Santiago.

Chile had one of Latin America's first independence movements. A cabildo abierto (town meeting) declared independence in 1810 in response to the French usurpation of the Spanish crown. Rival independence leaders Bernardo O'Higgins and José Miguel Carrera fought each other, then were overcome by Spanish troops. Eventually, Gen. José de San Martín, with O'Higgins as his chief ally, defeated the Spanish in 1817. In 1818 Chile formally proclaimed independence. O'Higgins ruled from 1818 to 1823, during which time he built a navy and consolidated the Chilean government under his dictatorial regime. However, his anticlerical and anti-nobility policies proved to be his undoing.

The next few years saw the growth of two political parties, the Conservative and the Liberal. While both were narrow elite factions, they differed in that Liberals favored a parliamentary, secular, federal system, while Conservatives wanted a traditional, religious, centralized system. The two groups fought bitterly, plunging Chile into civil strife until 1830 when Conservative Diego Portales assumed control of the political system.

Portales ruled as behind-the-scenes dictator from 1830 until his assassination in 1837. He launched a successful three-year war with Peru (1836–39), which destroyed a threatening Bolivian-Peruvian confederation. He also initiated a Conservative rule, which was to last until 1861. During that period, Chile's territory expanded with new claims to Patagonia and the island of Tierra del Fuego, and in 1847, the founding of Punta Arenas on the Strait of Magellan.

Between 1861 and 1891, the Conservatives were forced to share power with the Liberals, who had won several legislative victories. A wave of liberal reforms curtailed the power of the Roman Catholic Church and the presidential office. At the same time, both parties suffered a series of splits and realignments. But most notable during this period was Chile's greatest military achievement. In the War of the Pacific (1879–83), Chile again fought Peru and Bolivia, this time over possession of the Atacama Desert and its nitrate deposits. After victories on land and sea, Chilean forces entered Lima in 1881. By a treaty signed in 1883, Peru yielded Tarapacá, while Bolivia surrendered Antofagasta. The disposition of the other contested areas, Tacna and Arica, was not finally settled until 1929, when, with US mediation, Tacna went to Peru and Arica to Chile.

In 1891, Jorge Montt, a naval officer, led a revolt that resulted in eight months of civil war. The triumph of Montt marked the beginning of a 30-year period of stable parliamentary rule. Bolstered by nitrate revenues, Chile's national treasury grew, especially during World War I. At the same time the seeds of revolt were sown. Miners, farm workers and factory workers, sharing none of this prosperity, began to agitate for change. After the war ended, there was a recession and the country was on the verge of civil war. In 1920, a coalition of middle and working class groups elected Arturo Alessandri Palma as president. Alessandri, the son of an Italian immigrant, found himself in between the left's demands for change and the right's intransigence. He was deposed in a coup in 1924 but recalled in a countercoup in the following year. His second administration lasted only six months, but he left the legacy of a new constitution passed on 18 October 1925. The new system created a strong, directly elected executive to replace the previous parliamentary system. The military strongman Gen. Carlos Ibáñez del Campo ruled Chile from behind the scenes until 1927, then served formally as president until 1931. US banks loaned large sums to Chilean industry, and efforts were made to salvage the foundering nitrate trade and boost the copper sector. World depression struck, however, bringing an end to foreign loans and a catastrophic drop in world copper prices. A general strike caused Ibáñez to flee in 1931. After two years marked by short-lived juntas and presidencies and a 100-day "socialist republic," Alessandri was again elected.

Chile pulled out of the depression by 1938, but popular demand for social legislation remained unsatisfied. The 1938 election was narrowly won by Radical Party member Pedro Aguirre Cerda, running under the banner of a catchall coalition called the "Popular Front." His ambitious "new deal" program was never enacted, as Aguirre found himself in the crossfire of Chilean politics. His coalition dissolved formally in January 1941, and Aguirre died in November. In 1942, the Radicals won election easily over former dictator Ibáñez.

Juan Antonio Ríos governed moderately amid political conflict aroused by World War II. Ríos at first cooperated with Argentina in toning down the US-sponsored anti-Axis program but later led his country into a pro-Allied position, entering the war on the side of the United States in 1944. After World War II, Chile went into an inflationary cycle and riots and strikes broke out throughout the country. Ríos died in 1946, and a special election brought to power a coalition of Communists and former Popular Front supporters under Gabriel González Videla. González's coalition soon broke down, as the Communists organized demonstrations and strikes. Within months, González fired the three Communists he had appointed to cabinet positions. He then broke off relations with the Soviet Union, and outlawed the Communist party. Strikes and violence grew, and Chile, an example of stability by Latin American standards for so long, seethed with tensions. Chile's pursuit of industrialization, which had started with the Aguirre and Ríos administrations, had led to increasing social problems as the cities bulged with unemployable rural workers. As the cost of living soared, the radicalism of the workers intensified.

The 1952 election brought the 75-year-old Carlos Ibáñez del Campo back to power. The ex-dictator, who had been plotting to return to power for years, defeated González Videla by exploiting a split among the Radicals and the disaffected Communists. Despite his reputation as an authoritarian and his connection with Argentina's Perón, Ibáñez ruled democratically until 1958.

By 1958, the cost of living had soared and Chile's trade balance had moved from a large surplus to a deficit. Evidence of a general discontent could be seen in the 1958 presidential election. A narrow victory was won by Jorge Alessandri Rodríguez (a son of President Arturo Alessandri Palma), who received support from both Liberals and Conservatives. The Socialist Salvador Allende Gossens, supported by his own party and the newly legalized Communist Party, won 29% of the vote (compared with only 5% in 1952), and Eduardo Frei Montalva, candidate of the new Christian Democratic Party (Partido Demócrata Cristiano—PDC), ran third with 20% of the vote.

Aware of popular pressure for reform, Alessandri drew up a 10-year development plan, initiated in 1959 with construction projects, tax reforms, and a token start at agrarian reform. A devastating earthquake and tidal wave in 1960 cut drastically into Alessandri's programs, and his government was unable to regain momentum. In 1964, the traditional parties of the right and center lost strength to a wave of reform sentiment that shifted public attention to a choice between the socialist Allende and the moderate reformer Frei. In September 1964, Frei was elected by an absolute majority, and congressional elections in March 1965 gave the PDC a majority in the Chamber of Deputies and a plurality in the Senate.

The Frei government implemented numerous social and structural reforms. These included educational reform, land reform, and a scheme to create a majority Chilean interest in Chile's copper mines. Frei became a cornerstone of the Alliance for Progress, a harsh critic of communism, and a leading exponent of Christian democracy. However, the reforms did not deliver as hoped and overall economic growth was sporadic. The Frei administration was not able to control the endemic inflation that had plagued Chile for more than 80 years.

In the 1970 presidential election there were three contenders: Jorge Alessandri, PDC candidate Radomiro Tomic, and the Socialist Senator Salvador Allende. Allende, who was supported by Popular Unity, a leftist coalition that included the Communist Party, received 36.5% of the total vote. Alessandri followed with 35.2%, and Tomic with 28%, with 0.3% of the ballots left blank as a protest. Since no candidate received a majority of the popular vote, congress was required by the constitution to select the president from the two leading candidates. The PDC supported Allende in exchange for a promise of full constitutional guarantees. The victory was unique in that for the first time in the Western Hemisphere, a Marxist candidate took office by means of a free election. Allende, inaugurated on 3 November 1970, called for a socialist economy, a new leftist constitution, and full diplomatic and trade relations with Cuba, China, and other Communist countries. It was later revealed through US congressional investigations and independent journalistic inquiries that the United States, with the help of the International Telephone and Telegraph Corp. (ITT), had secretly worked to thwart the election and confirmation of Allende.

The first full year of rule by Allende witnessed a rise in economic prosperity and employment, as well as an improvement in the standard of living of the poorer elements of the population. Allende expropriated US copper interests and turned large rural landholdings into peasant communes. By 1972, however, the economy began to lag, and the situation was aggravated by middle- and upper-class resentment over the government's seizures of industrial and agricultural property. In June 1973, against a backdrop of strikes and street brawls beginning in the previous year, an abortive coup attempt was staged by a rightist army contingent. Throughout this period, the US Central Intelligence Agency had secretly supported the 1972 and 1973 strikes and disturbances, especially the truckers' strike, which had caused nationwide shortages of food and consumer goods.

On 11 September 1973, the Allende government was violently overthrown. Allende himself died—officially reported as a suicide. A four-man junta headed by Gen. Augusto Pinochet Ugarteseized power, dissolved congress, banned all political activities, and declared that Marxism would be eradicated in Chile. At least 3,000—and possibly as many as 10,000—people were killed or "disappeared" without a trace during and immediately after the coup. The military declared a state of siege and assumed dictatorial powers.

During its 16 years in power, the military attempted to eradicate not only Marxism, but all vestiges of leftism, trade unionism, reformism, and, for that matter, any other deviation from the official military line. High on their list of priorities was the privatization of the Chilean economy, which had gradually become more dependent on the state over three decades, a movement that had accelerated dramatically under Allende. This included the attracting of foreign investment, virtually untouched by government regulations or requirements. With unions under siege, workers' rights rapidly eroded under the regime.

This powerful dose of economic liberalization was administered within a continuously authoritarian political system. After the original state of siege was lifted in 1978, Chile continued under a "state of emergency" until another state of siege was declared from November 1984 to June 1985. A third state of siege was in effect from September 1986 to January 1987, after a failed assassination attempt against Pinochet. At each denial of democracy, the Pinochet government insisted that it was not yet done with the task of "redeeming" Chile, and that full political rights could not be restored until then. A constitution that outlawed the advocacy of Marxism and gave Pinochet eight more years of rule was passed in a controversial plebiscite by 67% of voters in 1980.

Although forced to operate clandestinely, an opposition nevertheless emerged. A collection of political factions found common cause with the Roman Catholic Church, forming a group called the Civic Union. The Church had become increasingly critical of the Pinochet regime, despite the latter's insistence that Catholicism was the cornerstone of the new Chile. When Pope John Paul II visited Chile in 1987, he brought accusations of torture and other human rights abuses. Finally, in 1988, Pinochet was pressured to call for a plebiscite to determine whether he should become president for another eight years. In February 1988, 16 political parties came together to form the "Coalition for the 'No'." In October 1988, Pinochet was soundly defeated, and in 1989 new elections were held. Christian Democrat Patricio Aylwin, running as the candidate of a 17-party Concert of Parties for Democracy (Concertación de Partidos por la Democracia) received 55.2% of the vote and assumed office in 1990. The election was hailed as a victory for democracy, but Chile remained under the watchful eye of the military. Pinochet, who remained head of the armed forces, retained enormous power.

The general resisted Aylwin's efforts to place the military firmly under civilian control, and threatened a return to military rule if any of his officers were prosecuted for human rights violations. The Truth and Reconciliation Commission, established during the Aylwin administration, recorded 1,102 disappearances and 2,095 executions and death from torture during the dictatorship years. Those figures did not include thousands of others who were detained, tortured, and exiled.

Little could be done to prosecute military abuses. Aylwin's administration was hampered by the constitution approved during the military regime. Pinochet had engineered the constitution to his favor, allowing the regime to appoint eight senators for life in the new government. With eight pro-military senators, the Senate's democratic coalition was unable to reach a majority and make constitutional changes. Military leaders also pushed through an amnesty law, which covered human rights abuses between 1973 and 1978. The Supreme Court remained under the control of judges sympathetic to the former military regime.

In the December 1993 presidential elections, the Concertación backed Christian Democratic Party candidate Eduardo Frei Ruiz-Tagle, the son of former President Eduardo Frei Montalva. With more than 58% of the vote, Frei continued the economic policies of his predecessor, with an even greater emphasis on social spending. By the end of the decade, poverty had declined to less than 20% from a high of 38% when democracy was restored. The Frei regime also emphasized privatization of state-owned enterprises, protection of foreign investment, and trade liberalization. Chile remained the world's leading producer and exporter of copper, but with a greatly diversified export base. By 1998 the nation had achieved 15 consecutive years of economic growth. After a short recession in 1999, growth resumed in 2000 but at lower rates.

While the country's commitment to democratic, representative government appeared secure and stable, Pinochet remained an impediment to real democratic reforms. In 1998, Pinochet retired as head of the military and became a senator for life. Despite eight years of democratic government, relations between the government and the military, which continued to assert its independence, remained tense. In October 1998, Pinochet traveled to London for back surgery. At the request of Spanish authorities, British police arrested Pinochet, who was recovering at a private hospital. Baltazar Garzón, a Spanish judge wanted Pinochet extradited to Spain to face charges of crimes against humanity. The arrest became a major international incident and shocked Chileans, most of whom thought Pinochet was untouchable. Following a lengthy legal battle that stretched across two continents and three nations, a London court in October 1999 ruled Pinochet could be extradited to Spain to stand trial. Back in Chile, the armed forces remained loyal to Pinochet and his arrest raised tensions between the military and the government. Yet, in his absence, Chilean politics were changing dramatically. While he languished in detention in England, the cause in favor of prosecuting human rights violators and finding out the whereabouts of individuals killed during the dictatorship moved forward in Chile. Several judges felt strengthened by the events in London and dared to indict active and retired military officers for human rights violations, contravening a amnesty passed by the military dictatorship in 1978. Some military leaders acknowledged that victims' families had a right to know what happened to the "disappeared." In March 2000, after 16 months in detention, the 84-year-old Pinochet was released. British authorities cited humanitarian reasons, saying Pinochet was medically unfit to stand trial. Pinochet returned to Chile, where he faced more than 70 criminal charges and efforts to remove him as senator for life. Chilean courts eventually ruled that he was unfit to stand trial in Chile for health reasons. He was forced to resign from the Senate and retired from public life. He currently lives in Santiago but does not appear in public or make public statements.

During his absence, the Concertación had backed the Socialist Ricardo Lagos for president. Joaquín Lavín, the conservative candidate, distanced himself from the hard politics of Pinochet and appealed for votes among Chile's poorest. Strains were beginning to show in the center-left coalition, which had ruled the country since 1990. Early in the campaign, Lavín, a former member of Pinochet's government, was not considered a strong candidate against Lagos. But both men finished tied in the December 1999 election, forcing a runoff election a month later. In the second round, Lagos captured 51.3% to narrowly defeat Lavín, who obtained 48.69% of the vote. With the victory, Lagos became the first Socialist to hold office since Allende. Lagos is a reformed Socialist who distanced himself from Allende's Marxist ideas. More of a social democrat similar in political style to England's Tony Blair, Lagos promised moderate policies and no changes to the nation's free-market economy. During the 1999 presidential campaign, the Chilean economy faced its worse recession in 20 years, with unemployment reaching 11%. But Lagos had ambitious programs of new infrastructure, health reform, judicial reform and educational reform. Yet, in 2002 the government was hurt when accusations of corruption surfaced that resulted in the indictments of several government coalition legislators and former cabinet ministers. The signing of a free trade agreement with the European Union and a much-awaited free trade pact with the United States helped boost Lagos's popularity in 2003. During his presidency, Chile was the most open economy in the region. Lagos's opposition in the United Nation's Security Council, where Chile had a two-year period, to US president George W. Bush's intention to attack Iraq in early 2003 positioned him as strong regional leader committed to strengthening the UN and the international rule of law. Lagos finished his six-term with the highest approval ratings of any president since democracy was restored. A constitutional reform approved in 2005 stripped all pending authoritarian enclaves from the Pinochet-imposed Constitution. It also reduced the presidential term to four years with no immediate reelection.

Michelle Bachelet, a socialist and the candidate of the ruling Concertación center-left coalition won the 2005 presidential elections. In addition to electing its first woman president, Chileans ratified the same ruling coalition for the fourth consecutive presidential election and fifth consecutive parliamentary election. The conservative camp divided its support among two candidates, Joaquín Lavín and Sebastián Piñera. Lavín, who narrowly lost in 2000, failed to catch on with the electorate and ended up third. Piñera, a more moderate rightwing politician and wealthy businessman, went on to lose the runoff against Bachelet. Yet, he successfully positioned himself as the new leader of the conservative camp. The fact that former dictator Pinochet was involved in a secret bank accounts corruption scandal uncovered in the United States hurt the conservative parties, still associated with the Pinochet legacy in the 2005 elections.

Bachelet inherited a stable economy, but her challenges included renewing her coalition and projecting a platform for future growth. Because she is the daughter of a victim of the military dictatorship and suffered herself arrest and exile during the Pinochet era, Bachelet—who served as Lagos's defense minister—has also symbolized reconciliation for many Chileans. She started her four-year term with unprecedented opportunities to help Chile move forward as the most developed country in Latin America by 2010, Chile's bicentennial.

GOVERNMENT

After the restoration of democracy in 1990, Chile continued to feel the legacy of the Pinochet regime. The Constitution of 1980 is still in effect, even though it was created with a different Chile in mind. In 1989, a series of amendments went into effect, reducing the influence and power of the military and consolidating the power of elected authorities. The 1980 constitution, as amended, is the third Chilean constitution. The first two were the original 1833 constitution, and the 1925 chart. The 1980 constitution was custom-made for the Pinochet military dictatorship, but it did not come fully into effect until after Pinochet left office in March of 1990. In 2005, new reforms stripped most of the remaining authoritarian provisions from the constitution.

The constitution provides for a strong executive serving a four year term (although Lagos and Frei served for six years, before the 2005 constitutional reform). The president has the authority to proclaim a state of emergency for up to 20 days and the power to introduce legislation and control the legislative agenda. There is a bicameral National Congress, consisting of a 120-member Chamber of Deputies and a 38-member Senate. Until 2005, the Senate included nine appointed members, as well as all ex-presidents, who had life membership. But starting in 2006, all senators were democratically elected. The constitution also provides for an independent judiciary, headed by a 21-member Supreme Court.

The 2005 constitutional reforms eliminated the active participation of the armed forces in government, although there remained some limitations on the right to strike and on freedom of information and expression. The Constitution institutionalizes a freemarket economy. Although the Constitution was adopted under the Pinochet military dictatorship, several reforms starting in 1990 and, ending in a comprehensive package in 2005, made it more compatible with democratic standards.

POLITICAL PARTIES

Except for an initial period of political disorder, independent Chile's first century of political life was dominated by the aristocratic Liberal and Conservative parties. Segments of the two parties split, shifted, entered into new alliances, regrouped, and took on new names. Since electoral law permitted the registration of parties with relatively small popular bases, coalitions were usually formed to elect presidents and control the congress. Many cabinets had a fleeting existence. After 1860, the Radicals emerged from the Liberal party, and over the next six decades, they increased their following with the rise of the middle class. In the meantime, the Liberals became conservative, and moved close to that party. Although the Conservatives and Liberals disagreed over the status of the Roman Catholic Church and over the matter of relative congressional and presidential powers, they were united in opposing the Radicals.

Designation of Chilean parties as being of the right, center, or left has been a function of shifting national political climates. Parties and party alliances have tended to appear and disappear over time. During the 1950s and 1960s, there were fewer, but much larger parties. Before the 1973 military coup there were five major parties in Chile: the Christian Democratic Party, founded in 1957, the Socialist Party, founded in 1931, the Communist Party, founded in 1921 (and outlawed during 1948–58), the National Party, formed in 1966 by members of the Liberal and Conservative parties, and the old Radical Party, which saw its strength greatly diminished after 1964. The ruling Allende coalition of Popular Unity consisted of Socialists, Communists, and several smaller leftist parties. The most radical political group, the Revolutionary Movement of the Left, was not a coalition member.

In September 1973, all the Allende coalition parties were abolished. The other parties were initially suspended and then banned in March 1977.

The reemergence of political parties in the aftermath of Pinochet's ouster was dramatic. In 1990, to ensure that Pinochet's preferred presidential candidate would not take office, several center-left parties came together as the Coalition of Parties for Democracy (Concertación) and backed a single candidate. Today, the coalition includes four major parties: the Christian Democrats (PDC), the Party for Democracy (PPD), the Radical Party (PR), and the Socialist Party (PS). The Concertación has won four consecutive presidential elections, five consecutive parliamentary elections, and four consecutive municipal elections, becoming the most successful and lasting political coalition in Chile's history. The opposition from the right comes from the Independent Democratic Union (UDI), and the National Renewal (RN), which, bolstered by the influence of most Senate appointees held sway in the Senate since the restoration of democracy in 1990 until 2005. In the left, a coalition of the Humanist Party and Communist Party has attracted as much as 10% of the vote but has failed to gain parliamentary representation because of the electoral system—known as binominal—that favors the two largest coalitions.

LOCAL GOVERNMENT

After the military government came to power in September 1973, local authorities yielded power to the armed forces, and the nation was divided into military districts. The traditional 25 provinces, as well as all municipalities, were placed under military control.

Today, the country is divided into 13 regions, including the metropolitan area of Santiago, which is not numbered like the other 12 regions, beginning with Region I at the northern border with Peru and continuing in sequence to Region XII at the southern end. The regions each have a capital and are subdivided into provinces. Regions and provinces are administered by regional intendants and provincial governors. The nation's 345 municipalities, headed by mayors, form the smallest units of local government. Mayors and local councilors are elected every four years in concurrent elections.

In 1991, a constitutional amendment was passed granting some autonomy to local areas, but compared to other countries in the region; local governments in Chile remained weak. Legislation was introduced to create two new regions and to allow for the direct election of regional legislatures.

JUDICIAL SYSTEM

The Chilean civil code of 1857, although modified and amended, remained in use until 1973. Although not eliminated by the military in the wake of the 1973 coup, the judicial system had almost all of its major powers removed, with the military code of justice in force as the effective law of the land. In 1975, the junta began to restore some of the traditional powers exercised by the 13-member Supreme Court.

The 1980 constitution, which came into full effect in 1989, provides for an independent judiciary. The Supreme Court, whose 21 members are appointed by the president with Senate approval, has authority over appellate and lower courts but does not exercise jurisdiction over the ten-member Constitutional Court and the five-member Electoral Court, which supervises all elections.

Although independent in theory, the judiciary remains subject to criticism for inefficiency and lack of independence. The Court's unwillingness to prosecute human rights violations during the military dictatorship cost the judicial system dearly and hindered its reputation. Appointees of the former military regime dominated the courts for most of the 1990s. By 2000, turnover had diminished the number of pro-Pinochet judges, and some judges were asserting their independence. In addition, a comprehensive reform adopted in 1997 effectively strengthen the judiciary and made it more autonomous of the military and civilian authorities. A criminal legal reform initiated in 1997 was completed in 2004 with the separation of the role of judge and prosecutor. A similar reform was likely to occur for civil cases, where the judge currently also serves as the prosecutor.

Military tribunals have jurisdiction over the military officers. Military courts have also authority to charge and try civilians for defamation of military personnel for sedition. In such cases, appeals can be made to the civilian Supreme Court. Reforms passed in 1991 (the "Cumplido" laws) transferred some of the jurisdiction of the military tribunals to the civilian courts

There is no jury trial. The legal system is mainly based on Napoleonic Code. The constitution provides for the right to counsel.

ARMED FORCES

The Chilean armed forces in 2004 had 78,098 active and 50,000 reserve personnel. Military service became voluntary beginning in 2005. The Army numbered 47,700 active personnel (20,700 conscripts). Equipment included 260 main battle tanks, 157 reconnaissance vehicles, 20 armored infantry fighting vehicles, 1,066 armored personnel carriers, and over 615 artillery pieces. The Navy had 19,398 personnel (1,660 conscripts; 600 naval aviation personnel and 3,500 Marines). Major naval units included 4 tactical submarines, 2 destroyers, 4 frigates and 25 patrol/coastal vessels. The naval aviation arm's six combat capable aircraft consisted of the PC-7 Turbo Trainer. The Air Force had 11,000 personnel (700 conscripts). The service had 87 combat capable aircraft including 18 fighters and 69 fighter ground attack aircraft. In addition, there is a 38,000 member paramilitary national police force, the Carabiñeros. Chile participated in UN peacekeeping missions in the Middle East, Haiti, and India/Pakistan. The defense budget in 2005 totaled $1.66 billion.

INTERNATIONAL COOPERATION

Chile is a charter member of the UN, having joined on 24 October 1945, and participates in several nonregional specialized agencies. The headquarters of ECLAC and the Latin American office of the FAO are located in Santiago. In 2002, Chile signed a free trade agreement with the European Union, becoming the first Latin American nation to do so; in 2003, Chile signed a free trade agreement with the United States, becoming the second Latin American nation, after Mexico, to do so. Chile is a member of APEC, G-15, G-77, the Latin American Economic System (LAES), the Latin American Integration Association (LAIA), the OAS, and the Río Group. The country is an associate member of Mercosur.

Chile is part of the Nonaligned Movement, the Agency for the Prohibition of Nuclear Weapons in Latin America and the Caribbean (OPANAL), and the Organization for the Prohibition of Chemical Weapons. Chile has offered support to UN peacekeeping and administrative efforts in Kosovo (est. 1999), India and Pakistan (est. 1949), and Haiti (est. 2004). The country is a signatory of the 1947 Río Treaty, an inter-American security agreement.

In environmental cooperation Chile is part of the Antarctic Treaty; the Basel Convention; Conventions on Biological Diversity, Whaling, and Antarctic Marine Living Resources; Ramsar; CITES; the London Convention; the Kyoto Protocol; the Montréal Protocol; MARPOL; and the UN Conventions on the Law of the Sea, Climate Change, and Desertification.

ECONOMY

The Chilean economy is strongly oriented toward commerce and industry, although minerals, chiefly copper and iron ore, provide most of the country's foreign exchange earnings. Chile's leading industries are engaged in the processing of local raw materials; they include mineral refining, metal manufacturing, food processing, paper processing, and textiles. Chilean agriculture, dwarfed in value by mining and manufacturing, supports less than oneseventh of the population. Arable land is limited and livestock raising is the dominant rural enterprise.

The economy suffered profound economic disruptions during the Allende period (1970–73). Legal nationalization of industries and expropriation of large agricultural holdings by the military government were accompanied by illegal seizures of property. The chaotic situation was exacerbated by acts of economic sabotage perpetrated by the opposition, by covert destabilization by agents of the United States, and by denial of commercial credit by foreign banks and corporations. By the time of the military coup in late 1973, the nation's manufacturing and farm production had fallen by about 10% from 1972 levels, and inflation had soared to 350%.

After the Pinochet coup, the military government attempted to revitalize the economy by adopting the principles of a free marketplace, although without reversing Allende's nationalization of the copper industry. Subsidies were removed and tariffs were lowered to increase competition. A policy of privatization of industries and utilities was instituted, including the return of companies nationalized under Allende to their previous owners (again, excepting the copper industry, which remained nationalized), the sale of government-owned companies to individuals and conglomerates, and the sale of percentages of companies to employees and the public on the stock exchange. The GDP fell by 12% in 1975, but Chile's economic performance began to improve thereafter. The average annual rate of increase in GDP between 1977 and 1981 was 7.8%, and the inflation rate dropped from 174% in 1976 to 9.7% in 1981. In 1982, however, a severe economic slump (caused by the worldwide recession, low copper prices, and an overvalued peso) led to an inflation rate of 20.7%, a drop in the GDP of 15% in real terms, and jump in unemployment to 30%. Chile had been caught in the Third World debt crisis that followed the second oil shock of 1978–79.

Beginning in 1984, growth returned, averaging 7% for the next five year (1984–88), constrained somewhat by persistently depressed world copper prices. An economic adjustment program introduced in 1985 aimed at strengthening exports other than copper, increasing domestic savings and investments, and strengthening the financial and corporate sectors. Inflation remained high, averaging almost 21% (1985–88), but unemployment dropped from 12% to 6%. In 1989, GDP growth rose to 10% and unemployment fell to 5%, although inflation remained in double digits (17%). Civilian rule, starting in 1990, implemented positive monetary policies that continued to lower inflation and attract investment. Inflation was down to 6% by 1997, and growth of GDP averaged over 8% between 1988 and 1997. By 1995, unemployment had fallen to 4.7%. In 1998, however, growth was slowed to 3.2% and then turned negative (-1.0%) in 1999 in the first contraction since 1983, as the effects of the Asian financial crisis of 1997, the Russian financial crisis of 1998, and the Brazilian financial crisis of 1999 were felt. Unemployment increased to 6.2% in 1998, and then to 9.7% in 1999. Inflation, however, remained low at 4.7% (1998) and 2.3% (1999), the lowest yearly rate yet achieved since the 1960s. Growth returned in 2000 at 4.4% and unemployment eased to 9.2% while inflation edged up to 4.5%. However, a more robust recovery was short-circuited by the global slowdown than began in 2001, aggravated by the aftermath of the 11 September 2001 terrorist attacks on the United States. The GDP growth rate fell to 2.8% in 2001 and was estimated at 3% for 2002. Inflation remained under control at 2.6% in 2001 and 3% in 2002. Chile's official unemployment rate remained above 9%.

On 6 June 2003 Chile signed a free trade agreement with the United States, making it the second Latin American country to do so (after Mexico). The United States had delayed the signing because of Chile's opposition as temporary member of the Security Council to the US-led invasion of Iraq in March 2003.

The GDP growth rate was 6.1% in 2004, up from 3.7% in 2003, and 2.2% in 2002; in 2005, the economy was estimated to have expanded by 5.8%. The inflation rate dropped to 1.1% in 2004 and it did not pose any problems to the economy. The unemployment rate was fairly stable, but it registered a long term downward trend—in 2005, it was estimated at 7.4%. The engines of growth in 2004–05 were high copper prices, booming exports (especially for mining, forestry, and fishing), and increased foreign investments. In November 2005, Chile signed a free trade agreement with China.

INCOME

The US Central Intelligence Agency (CIA) reports that in 2005 Chile's gross domestic product (GDP) was estimated at $180.6 billion. The CIA defines GDP as the value of all final goods and services produced within a nation in a given year and computed on the basis of purchasing power parity (PPP) rather than value as measured on the basis of the rate of exchange based on current dollars. The per capita GDP was estimated at $11,300. The annual growth rate of GDP was estimated at 5.9%. The average inflation rate in 2005 was 4%. It was estimated that agriculture accounted for 6.2% of GDP, industry 46.5%, and services 47.3%.

According to the World Bank, in 2003 remittances from citizens working abroad totaled $13 million or about $1 per capita. Foreign aid receipts amounted to $76 million or about $5 per capita and accounted for approximately 0.1% of the gross national income (GNI).

The World Bank reports that in 2003 household consumption in Chile totaled $43.94 billion or about $2,781 per capita based on a GDP of $72.4 billion, measured in current dollars rather than PPP. Household consumption includes expenditures of individuals, households, and nongovernmental organizations on goods and services, excluding purchases of dwellings. It was estimated that for the period 1990 to 2003 household consumption grew at an average annual rate of 5.8%. In 2001 it was estimated that approximately 17% of household consumption was spent on food, 24% on fuel, 20% on health care, and 15% on education. It was estimated that in 2000 about 20.6% of the population had incomes below the poverty line.

LABOR

In 2005, Chile's labor force was estimated at 6.3 million workers. Of the employed workforce in 2003, service occupations accounted for 63%, while 13.6% were in agriculture, and 23.4% in the industrial sector. Unemployment and underemployment have plagued successive governments during recent decades, reaching nearly 22% (unofficially) by the end of 1990. As of 2005, Chile's unemployment rate was 7.4%, down from 10.1% in 2001.

Workers have the right to form and join unions without the need to obtain prior approval. Although private sector employees have the right to strike, it is regulated by the government. Public employees are denied the right to strike. Although it is allowed to replace striking workers, employers must pay a cash penalty that is divided among the strikers. Employers must also pay severance benefits to dismissed striking workers and show cause for dismissal. Union membership dropped from about 30% of the labor force in 1975 to about 10% in 2005.

Although child labor is restricted by law, in Chile's informal economy it is a problem. Minors between the ages of 15 and 18 can work but must have parent or guardian approval. In addition, they must also attend school. There are also other requirements regarding the type of labor opened to them and how long they may work. Work in underground mines is limited to those 21 and over, although 18 to 21 year olds can work at other types of mining sites.

The law sets the minimum wage and it is adjusted annually. As of end 2005, it was set at $245 per month. The minimum wage is designed as a starting wage for an unskilled single worker and does not provide a decent standard of living for a family. The legal workweek is 45 hours and 10 hours per day (which includes overtime pay) with limited exceptions. There are also occupational safety and health standards. The government is putting expanded resources into enforcement of these measures and compliance is increasing.

AGRICULTURE

Of the total land area of 74.8 million hectares (184 million acres), 2.3 million hectares (5.7 million acres) is arable land. Until 1940, Chile was substantially self-sufficient in most basic foodstuffs. Since World War II (1939–45), serious food deficits have developed, adding to the nation's external payments burden.

Agricultural production of major crops in 2004 (in tons) was as follows: sugar beets, 2,370,483; wheat, 1,921,652; corn, 1,320,606; oats, 538,600; barley, 81,000; rapeseed (canola) 18,500; and rice, 119,265.

Agriculture was one of the sectors most adversely affected by the recession of 1982, but it quickly recovered by the mid-1980s. Poor results in the traditional agricultural sector inhibit a more rapid expansion in agriculture. One of the areas of most rapid growth is in fresh fruit, with the production of grapes rising by 235% between 1981 and 1985. The fruit harvest in 2004 (in tons) included grapes, 1,900,000; apples, 1,250,000; peaches and nectarines, 304,000; pears, 205,000; oranges, 125,000; and lemons and limes, 160,000. Avocado production for 2004 was estimated at 160,000 tons, up from 39,000 tons during 1989–91. Most of the avocado orchards are in central Chile.

The traditional land system, inherited from colonial times, has retarded maximum use. Chile's first agrarian reform law, passed in 1962 and supplemented by a constitutional reform in 1963, enabled the government to expropriate and subdivide abandoned or poorly cultivated land and compensate the landowner in installments. Another agrarian reform law was passed in 1967 to clarify expropriation and settlement procedures and to permit an increased turnover rate. By the end of the Frei administration in November 1970, some 1,400 agricultural estates, representing 3.4 million hectares (8.4 million acres), had been confiscated and converted to asentamientos (agricultural communities).

The pace of expropriation was accelerated by the Allende government, which by 1972 had doubled the previous administration's figure for land acquisitions. By taking over virtually all of the land subject to redistribution under the 1967 reform act, the Allende government effectively transformed the Chilean land tenure system. In addition, agricultural laborers, often led by militants to the left of the Allende government, illegally seized some 2,000 farms. Following the 1973 coup, the military regime returned almost all farms in the last category to their original owners; the expropriated land was redistributed to 45,000 smallholders. In 1978, the land reform law was replaced by new legislation that removed restrictions on the size of holdings.

ANIMAL HUSBANDRY

Stock raising is the principal agricultural activity in most rural areas. In 2004 there were an estimated 3.7 million sheep, 4 million head of cattle, 3.2 million hogs, 725,000 goats, and 790,000 horses, mules, llamas, and alpacas. The extreme south of Chile is noted for sheep production, while cattle are raised in the central regions. Meat products must be imported from Argentina to fulfill domestic demand. In 2004, 208,258 tons of beef and veal, 363,305 tons of pork, and 19,539 tons of mutton and lamb were produced. In north-central Chile, the hills afford pasturage during the rainy season, and fodder or irrigated pasture provides feed during the dry months. In the south-central regions, natural pasturage is available throughout the year.

The dairy industry is small; milk production totaled 2,309,750 tons in 2004. Production of raw wool in 2004 was an estimated 15,100 tons.

FISHING

With 1,016 species of fish within Chilean waters, its commercial fisheries have long been important. The low temperatures and Antarctic current supply the purest and most oxygenated marine waters in the world. Since 1959, their growth has been rapid, largely owing to the development of a fish-meal industry, centered around Iquique. Anchovies are predominant along the northern coast, whiting and mackerel in the central waters, and shellfish in the south.

Leading fish and seafood caught commercially are Spanish sardines and yellow jacks, as well as anchovies, whiting, eels, sea snails, mackerel, and mussels. Tuna fishing has increased, as have catches of clams and lobsters. The total fish catch soared from 340,000 tons in 1960 to 1,237,000 tons in 1976 and 4,185,188 tons in 2003, but down from 7,720,578 tons in 1994. Chile is ranked seventh in the world in total landings of fish. In 2003, Chile contributed 3.4% to the world's exports of fish products, valued at $2.13 billion. Exports of fish and fish-meal account for about 9% Chile's total exports.

Increasingly, salmon production is playing an important role in Chile's fishing industry. The Chilean salmon and trout industry consists of more than 70 companies employing directly and indirectly over 40,000 workers. Aquaculture is conducted in 234 coastal operations for which the companies pay user fees to the government. In 2004, exports of salmon and trout products were valued at $996.2 million and were projected to top $2 billion by 2010.

FORESTRY

Chile has extensive forests, estimated at some 15.5 million hectares (38.3 million acres), or about 20.7% of the total land area. In 2004, the total area of commercial forests increased by 32,000 hectares (79,000 acres). The average annual deforestation rate during 1990–2000 was 0.1%. Logging operations are concentrated in the areas near the Bío-Bío River. Softwoods include alerce, araucaria, and manio; hardwoods include alamo, laural, lenga, and olivillo. The establishment of radiata pine and eucalyptus plantations, largely as a result of government assistance, has helped Chile to become an important supplier of paper and wood products to overseas markets. Chile is a major source of hardwood in the temperate zone. Native forests—in addition to the radiata pine and eucalyptus—are as yet under-utilized and could become an important factor in Chile's growing competitiveness. Most wood products from Chile are exported as logs, chips, and lumber.

The total roundwood harvest in 2004 was 44.3 million cu m (1.56 billion cu ft). About 65% of the roundwood output is used by the forestry industry, and the rest is used as firewood. Commercial uses for roundwood include pulp, wood chips, sawnwood, and lumber production. At least half of Chile's population uses firewood for heating and cooking.

Government incentives also resulted in an increase of forestry product exports from $36.4 million in 1973 to $468 million in 1980; by 1991, forestry exports rose to $836 million. In 2004, the forestry sector generated exports of $3.4 billion, or 11% of Chilean exports. Export demand has especially strengthened for sawnwood and wood pulp. Production from 1987 to 1991 increased by nearly 60% as a result of maturation of trees planted in the 1970s. Chile's forest products sector has expanded through commercial planting, especially radiata pine and eucalyptus. The major markets for Chilean wood are the United States, China, Japan, Mexico, Netherlands, and Italy. The Chilean-German Technology Transfer Center in Concepción assists in contributing to the technological development of forestry in the Bío-Bío region.

MINING

In 2003, Chile produced around 36% of the world's mined copper, was home to the largest copper mine in terms of production, and continued to be a top producer and exporter of copper by volume and value. Copper Refined copper accounted for 35.4% of the country's exports in 2003. Chile's copper mines accounted for 36% of the world's production in that year Chilean mining activities were also concentrated in coal, iron, precious metals, and industrial minerals. Traditionally dependent on copper exports, Chile also produced iodine and lithium, molybdenum, potassium nitrate, sodium nitrate, gold, silver, rhenium, and selenium. Iron ore was another primary export mineral. Chile also exported ferromolybdenum, potash, and zinc. In addition, Chile produced arsenic trioxide, lead, manganese, barite, natural borates (ulexite), bentonite, kaolin, other clays, diatomite, dolomite, feldspar, crude and calcined gypsum, lapis lazuli, hydraulic lime, phosphate rock (apatite), pigments (mineral, natural, and iron oxide), pyrite, potassium chloride, pozzolan, pumice, common quartz, salt, sodium compounds (including natural sodium sulfate and anhydrous sodium sulfate), sand and gravel (silica), limestone (calcium carbonate), marble, sulfur, and talc.

The mineral industry employed 95,222 people in 2003, including office personnel, administrators, staff, and mining personnel.

Copper output totaled 4.9 million tons in 2003, up from 4.58 million tons in 2002.

Gold production increased to 38,954 kg, in 2003, up slightly from 38,688 kg in 2002. Silver production—derived from the gold and copper mining—totaled 1,313 metric tons, up from 1,210 metric tons in 2002.

Chile is a world leader in natural nitrate production. The Salar (salty marsh) de Atacama, which held significant nitrate reserves, also contained 58% of the world reserves of lithium. In 2003, lithium carbonate output was 41,667 metric tons, up from 35,242 metric tons in 2002. In 2003, Chile produced 15,580 metric tons of elemental iodine, up from 11,648 metric tons in the previous year. Chile also produced 215,000 tons of potassium nitrate and 919,000 tons of sodium nitrate in 2003.

Production totals for other minerals in 2003 were: manganese, 19,461 metric tons; molybdenum, 33,375 metric tons, up from 29,467 metric tons in 2002; zinc, 33,051 metric tons; and iron ore and concentrate (gross weight), 8,011,000 tons, up from 7,269 tons in 2002.

A cross-border mine treaty between Chile and Argentina, ratified by the countries' presidents in 2000, lifted restrictions on property ownership and access rights for mining and exploration along most of the border and simplified customs and taxation procedures. It was reported that the agreement should result in $6 billion worth of new mining investment over five years. Legislation passed in 1966 initiated a "Chileanization" policy for the copper industry, which provided for government ownership of a controlling share of the sector; US management of the large mines was permitted to continue. Agreements signed in 1967 with the three US-owned companies that produced most of Chile's copper provided for an increase of Chilean participation, expanded investment, and a stable tax and exchange rate; the government was to acquire an equity position in the mines. A law passed unanimously by the Chilean congress in 1971 provided for the nationalization of the copper holdings of the Kennecott and Anaconda corporations. Copper production grew significantly in the following years, despite the emigration of a large number of trained specialists. The military government of 1973–1990 subsequently compensated US interests for their expropriated holdings and sold many state-owned companies; the three democratic governments since 1990 have continued privatization at a slower pace. Foreign investment in copper has since resumed. The largest recent investment projects were the $2.342 billion La Escondida expansion copper oxides project, which started in 1998; the $2.185 billion Collahuasi copper cathode project, begun in 1998; the $1.8 billion Al Abra copper project, which started in 1997; the $1.307 billion Los Pelambres copper expansion project, which started in 1999; and the $1.33 billion Cerro Casale copper/gold project, whose start-up date had not been determined.

ENERGY AND POWER

Chile's limited domestic energy sources means that the country will have to rely upon imports to meet its rapidly expanding demand for energy. Electric power generation reached 39.8 billion kWh in 2000, up from 6.9 billion kWh in 1968. Output was estimated for 2003 at 45.3 billion kWh. Hydroelectric power accounted for 53% in 2003, with conventional thermal sources at 43%. Electricity consumption was 37.9 billion kWh in 2000, which increased to an estimated 44.1 billion kWh in 2003. Installed capacity in 2001 was 9.7 million kW. By 2003, it was estimated that installed capacity had risen to 10.5 GW.Within South America, Chile is exceeded only by Brazil in its hydroelectric power potential, much of it located in the heavily populated central part of the country between La Serena and Puerto Montt. The quick descent of Andes-born rivers, together with the narrowness of the country, makes production and transportation of electricity comparatively inexpensive. A severe drought in 1997–1999 created serious power shortages, including rolling blackouts in Santiago, and spurred Chile to try diversifying its power supply. As of 2002, the 570 MW Ralco hydropower project on the Bío-Bío River was slated for possible completion in 2003.

The state lays claim to all petroleum deposits, and a government agency, the National Petroleum Co. (Empresa Nacional del Petróleo—ENAP), manages oil fields in Region XII. ENAP's oil production only meets around 8% of Chile's needs and reserves are decreasing. Production, which began in 1945, is concentrated around the Strait of Magellan, both onshore and offshore. The crude petroleum is transported by sea to the refinery at Concón, north of Valparaíso. A second refinery was completed near Concepción in 1965 and, later, a third at Gregorio-Magallanes. In 2002, production totaled 14,000 barrels per day. By 2004, output had risen to an estimated 18,400 barrels per day. However, consumption in 2004 was estimated at 225,000 barrels per day. As of 1 January 2005, proven reserves were estimated at 150 million barrels. Chile's primary sources for imported oil are Argentina, Brazil, Angola, and Nigeria, respectively

ENAP also controls all of Chile's production of natural gas. Since 1997, when Chile began to import natural gas on a large scale, consumption has increased an average of 21.7% annually. In 2003, the consumption of natural gas in Chile totaled an estimated 249.3 billion cu ft. According to the Oil and Gas Journal, Chile's proven reserves of natural gas in 2005 stood at 3.5 trillion cu ft. Argentina is Chile's main source for imported natural gas.

Chile's recoverable coal reserves have been boosted by recent discoveries in the Bío-Bío area. Recoverable reserves were estimated in 2003 at 1,301.8 million short tons and are now believed adequate to supply Chile's needs for 100 years. A number of petroleum-fired electric generators have recently been converted to coal.

INDUSTRY

Chile ranks among the most highly industrialized Latin American countries. Since the 1940s, manufacturing has contributed a larger share of GDP than has agriculture. About one-third of the value added by manufacturing comes from the production of food, beverages, and tobacco products. During the last decade of the 19th century, food product exports soared, with growth of 85% up to 1,000%.

The basic industrial pattern, established in 1914, included food processing, beverage production, sugar refining, cotton and woolen mills, a hosiery mill, a match factory, an iron foundry, and a cement factory. During the next decade, industrial production rose about 85%, but from 1949 to 1958 the level of output was virtually stationary. With the establishment of the Huachipato steel mill in 1950, the groundwork was laid for the development of heavy industry. Chile's first copper refinery was inaugurated in November 1966. The major industrial region is the Santiago-Valparaíso area. Concepción is in the center of an industrial complex. The state-owned firm CODELCO is the world's second-largest copper mining company, but the private sector generally produces more copper than the state (two-thirds of the total).

During 1970–73, 464 domestic and foreign-owned plants and facilities were nationalized by the Allende government. These included the copper installations of the Anaconda and Kennecott corporations and other companies owned by US interests. By 1982, the military government had returned most expropriated installations to their original owners. The free-market policies of the junta, together with a worldwide recession, resulted in a 25.5% drop in manufacturing output in 1975. After the mid-1970s, Chilean industry moved away from concentration on import substitution to become more export-oriented. Over 20% of the 1985 value of industrial production came from exports, and in 1998, the value of exports exceeded the value of imports for the first time. Key sectors include textiles, automobiles, chemicals, rubber products, steel, cement, and consumer goods.

The industrial sector grew at an average rate of 7% between 1976 and 1982. Industrial output grew by an average of 3.7% per year between 1980 and 1990, and by 6.6% annually during 1988–98. Manufacturing output grew on average by 3.4% annually during the 1980s, and by 5.8% per year between 1988 and 1998. Chile has three oil refineries, with a production capacity of 205,000 barrels per day. It has a fledgling automobile industry: in 2001, Chile produced 10,519 units, up from 5,245 in 2000. It also produces some heavy trucks.

In 2005, industry accounted for 46.5% of the GDP (about the same figure as in the previous year), and was bested by services, with 47.3% (which was also the largest employer in the country); agriculture made up only 6.2% of the economy. The industrial production growth rate was 6%, overperforming the GDP growth rate in the same year.

SCIENCE AND TECHNOLOGY

The Academy of Sciences, which promotes research in the pure and applied sciences, and the Chilean Academy of Medicine, which promotes research and disseminates information in the health sciences, were both founded in 1964 in Santiago and are part of the Institute of Chile. In addition, there were, as of 1996, 64 specialized learned societies in the fields of medicine; the natural, biological, and physical sciences; mathematics and statistics; and technology. The government agency responsible for planning science and technology policy is the National Commission for Scientific and Technological Research. Total expenditures on research and development (R&D) totaled $799.218 million in 2001 or 0.54% of GDP. Government spending accounted for 68.9% of R&D expenditures in 2001, with business accounting for 24.9%, foreign sources 4.1% and nonprofit institutions at 2.1%. In that same year, Chile had 419 researchers and 307 technicians actively engaged in R&D. High technology exports in 2002 totaled $107 million in 2002, or 3% of manufactured exports.

Chile has 22 institutes conducting research in agriculture, medicine, natural sciences, and technology, as well as the European Southern Observatory. At least 27 colleges and universities offer degrees in basic and applied sciences. In 1987–97, science and engineering students accounted for 42% of college and university enrollments.

DOMESTIC TRADE

The best market for manufactured and imported goods is heavily concentrated in central Chile, particularly in Santiago, Valparaíso, and Viña del Mar. Valparaíso, which serves as the shipping outlet for Santiago, is Chile's chief port. Concepción provides direct access to the markets of southern Chile and Antofagasta to those in northern Chile.

The predominant elements in the pattern of retail merchandising are the independent merchants. They sell their wares in small specialized stores, in municipally owned markets, or in free markets (ferias libres ). There is a growing number of chain groceries and supermarkets. As of 2002, there were about 80 franchises supporting about 300 stores throughout the country. Shopping malls are showing up in major cities. Stores are owned primarily by Chileans, although foreign interests are represented in retail merchandising.

Some large segments of the economy are still controlled by business groups, but the number of small and medium-sized private companies is growing. An 18% value-added tax applies to most goods. Government policies toward privatization have been in effect since the 1970s and both foreign and domestic investments have been encouraged.

The usual retail business hours are from 10:30 am to 7:30 pm, with half a day on Saturday. Business hours run from 9 am to 6 or 7 pm, Monday through Friday, with a one hour lunch break at one. Normal banking hours are from 9 am to 2 pm, Monday through Friday. It is common practice for stores and factories to close for about 15 days sometime between 1 December and 1 April for summer vacation. The business language is Spanish, but most business people also know English.

FOREIGN TRADE

Copper remains Chile's largest commodity export (28%) and the country has the highest percentage of the world export market of that mineral (16%). Other significant exports include wood pulp and waste paper (6.1%), fruit and nuts (6.5%), and fish (6.5%). Chile claims 7.2% of the world's wood chip exports.

In 2005, exports reached $38 billion (FOB—Free on Board), while imports grew to $30 billion (FOB). In 2004, the bulk of exports went to the United States (14%), Japan (11.4%), China (9.9%), South Korea (5.5%), the Netherlands (5.1%), Brazil (4.3%), Italy (4.1%), Mexico (4%). Imports included intermediate goods, capital goods, and consumer goods, and mainly came from Argentina (16.8%), the United States (13.7%), Brazil (11.2%), and China (7.5%).

BALANCE OF PAYMENTS

Between 1982 and 1984, the combination of world recession, slumping copper prices, rising foreign interest rates, and an unexpected rise in imports prompted the Pinochet regime to impose domestic austerity measures in order to meet IMF fiscal and monetary targets. The unrest that followed forced the government to request a 90-day moratorium on some debt repayments and seek rescheduling of $3.4 billion due in 1983–84. The current account balance averaged -$2 billion from 1980 to 1995, but fell again to -$4.5 billion in 1998. Following the 1998 recession, Chile applied tight monetary policies to push the current account into a small surplus in 1999. By 2000, however, the current account posted a $1 billion deficit.

The International Monetary Fund (IMF) reported that in 2001 Chile had exports of goods totaling $18.5 billion and imports totaling $16.4 billion. The services credit totaled $3.81 billion and debit $4.81 billion. The US Central Intelligence Agency (CIA) reported that in 2001 the purchasing power parity of Chile's exports was $18.5 billion while imports totaled $18 billion resulting in a trade surplus of $500 million.

Exports of goods and services reached $34 billion in 2004, up from $25 billion in 2003. Imports increased from $24 billion in 2003, to $28 billion in 2004. The resource balance was consequently

positive in both years, improving from $2 billion in 2003, to $6 billion in 2004. The current account balance however was negative, deteriorating from -$594 million in 2003, to -$1.7 billion in 2004. Foreign exchange reserves (including gold) reached $15 billion in 2004, covering more than five months of imports.

BANKING AND SECURITIES

During the Allende period, almost all private banks were taken over by the government, mainly through the purchase of stock. The military government reversed its predecessor's policy, making the financial market essentially private. In 1999, Chile had, in addition to the Central Bank, 29 banks and 3 finance societies (which have less capital than banks and cannot perform foreign trade operations). There was one state-owned bank; the Banco del Estado is the country's second-largest bank, with 13% of loans and 14% of deposits in 1998. Six US banks, twelve Chilean banks, and eleven foreign banks operated in Chile. The Central Bank and the Superintendent of Banks and Financial Institutions (that reports to the Finance Minister) both regulate the financial industry.

Following government intervention in a number of financial institutions in 1983, the Central Bank introduced three major measures: the issue of $1.5 billion in emergency loans; a provision by which banks could sell their risky portfolios to the Central Bank for 10 years with an obligation to use their profits to buy them back; and the "popular capitalism" program, announced in April 1985, which allowed, among other things, a new share issue for banks in which there had been intervention.

A working group was formed in December 1996 to iron out the remaining technical obstacles to a new banking law so that it might be approved by both houses of congress before February 1997. Several deadlines were missed regarding bank liberalization, which has been under discussion since 1991. The Central Bank kept its main monetary policy instruments unchanged in 1995, but it lifted its target range for interbank rates from 7–7.5%. In 1997, a new banking law relaxed some of the restrictions by allowing banks to provide factoring and leasing services.

Securities trading has been traditionally inhibited by the Chilean investors' preference for real estate investment. There is free sale of securities, the largest groups of which are in mining, banking, textile, agricultural, metallurgical, and insurance stocks. All corporations with more than 100 shareholders must register with a stock exchange. The International Monetary Fund reports that in 2001, currency and demand deposits—an aggregate commonly known as M1—were equal to $6.5 billion. In that same year, M2—an aggregate equal to M1 plus savings deposits, small time deposits, and money market mutual funds—was $30.9 billion. The money market rate, the rate at which financial institutions lend to one another in the short term, was 6.81%. The discount rate, the interest rate at which the central bank lends to financial institutions in the short term, was 6.5%.

In 2004, there were 239 companies were listed on the Bolsa de Comercio de Santiago, (BCS), which was founded on 27 November 1893. It is a private company comprised of 48 shares held by single shareholders. Chile's first stock exchange dates from 1892 and was established in the Port of Valparaíso. It closed in 1982. Stock operations on the Santiago exchange are regulated by the Insurance and Value Superintendency. Total market capitalization in 2004 stood at $1.200 billion. As of end 2004, the IGPA index stood at 8,962.6, up 22.2% from the previous year.

In November 1996 the foreign ministry and the Central Bank, together with the superintendence for banks (SBIF) and for securities and insurance (SVV) completed a draft bill for the launch of an offshore stock market in Santiago. It would operate in foreign currency, not convertible into pesos, and would give access to the local capital and credit markets to all Latin American and other foreign borrowers. The offshore stock market began operations in 2000.

INSURANCE

The insurance market is regulated through the Superintendent of Security Markets and Insurance Companies. Accounting practices reflect generally accepted accounting principles, and, in addition, the requirements as established by the Superintendent. These differ from generally accepted accounting principles in the United States in respect to accounting for monetary correction which takes into consideration the changing price levels in Chile.

The Chilean insurance market is characterized by a relatively large number of insurers for its size and a very competitive environment. The market was opened to foreign organizations, the government insurers were privatized, and the market liberalized under the military government. An increasing number of foreign insurers operate in Chile either in association with domestic organizations or independently. Workers' compensation and automobile personal accident insurance for drivers, passengers, and third parties are compulsory.

In 2003, direct insurance premiums written in Chile totaled $3.396 billion, with $2.117 billion comprised of life insurance and $1.225 billion comprised of nonlife insurance. The country's top nonlife insurer in 2003 was Ceuz del Sur, with $158.5 million in gross nonlife premiums written. ING was Chile's top life insurer that same year, with $387.7 million of gross life premiums written.

PUBLIC FINANCE

Chile experienced budget deficits from the early 1960s through the mid-1970s. Expenditures grew steadily with the expansion of public-sector participation in social welfare and economic activities and with increasing government investment in development projects; the resulting deficits were covered by Central Bank loans and foreign borrowing. Budgetary surpluses were recorded from 1975 through 1981, after which the pattern reverted to deficits. From 1985 to 1993, Chile reduced its external debt by $11.3 billion through debt-equity conversions.

The US Central Intelligence Agency (CIA) estimated that in 2005 Chile's central government took in revenues of approximately $29.2 billion and had expenditures of $24.7 billion. Revenues minus expenditures totaled approximately $4.4 billion. Public debt in 2005 amounted to 8.1% of GDP. Total external debt was $44.8 billion.

The International Monetary Fund (IMF) reported that in 2003, the most recent year for which it had data, central government revenues in billions of pesos were p10,604.4 billion and expenditures were p10,884.1 billion. The value of revenues in US dollars was us$15 million and expenditures us$16 million, based on a market exchange rate for 2003 of us$1 = p691.43 as reported by the IMF. Government outlays by function were as follows: general public services, 10.2%; defense, 6.3%; public order and safety, 6.2%; economic affairs, 12.4%; environmental protection, 0.3%; housing and community amenities, 0.9%; health, 13.9%; recreation, culture, and religion, 0.8%; education, 17.6%; and social protection, 31.4%.

TAXATION

Prior to 1920, government revenue was derived largely from export and import taxes, but since then, a more varied tax base has been achieved.

During the Allende period, the congress, which was strongly influenced by opposition parties, resisted government efforts to introduce redistributive income tax policies. At the end of 1974, the military government eliminated the capital gains tax and established a 15% taxation rate for income from real estate, investments, and commercial activities, which has since been reduced to 10%. In 2002 corporate income was paid in two stages: first on declared profits, called the first category income tax (FCIT); and then on distributed profits. The rate for the FCIT was increased from 15% to 16.5% in 2003, and was raised in 2004 to 17%. The rate on distributed profits is 35% minus the FCIT credit. Dividends and interest payments to nonresidents are taxed at 21.69% and 35%, respectively. Royalties and fees paid to nonresidents are subject to withholding taxes of 30%, though this may be modified through tax treaties.

Personal income is progressively taxed up to 40%. Other direct taxes include a housing tax, assessments on real estate, and inheritance and gift taxes.

Consumption taxes include a value-added tax (VAT) with a standard rate of 19%, various stamp taxes, entertainment taxes, and excise on gasoline, alcoholic beverages, and tobacco.

CUSTOMS AND DUTIES

As of 1 October 2003, most imported goods are subject to an 19% value-added tax. Automobiles were subject to a luxury tax of 85% on any value above $15,834.65. Other luxury items, such as jewelry, furs, and yachts were taxed at 50%. Import and export licenses are mandatory, but easily obtainable. In 1977, free trade zones were established in Iquique and Punta Arenas. Chile has free trade agreements with Canada, Mexico, Colombia, Venezuela, Ecuador, Costa Rica, MERCOSUR, and as of 1 January 2004, with the United States. Under the agreement, items originating in the United States would have a tariff between 0% and 6%, although the Chilean tariff rate on nearly all products from most countries is 6%. Chile also places a 50% tax surcharge on used goods/products in addition the current tariff rate. However, the surcharge does not apply to those items originating in the United States, as well as exempting armored cars, prison vans, ambulances, public road cleaning vehicles, cement-making vehicles, and mobile homes. Cigars, cigarettes and processed tobacco are subject to taxes of 51%, 60.4%, and 57.9%, respectively.

FOREIGN INVESTMENT

Through the Decree Law 600 of 1974 (and its subsequent modifications) and the Chilean Foreign Investment Committee, Chile seeks to encourage foreign direct investment. However, broadcasting, fishing, shipping, and hydrocarbon production usually require majority national control. Foreign investors have purchased many of the assets privatized by the Chilean government over the last decade. Chile has the highest credit rating of all Latin American countries. From 1997 to 2001, $28.2 billion of foreign direct investment (FDI) went into Chile. FDI flow peaked in 1999 at $9.2 billion but dipped to $3.67 billion in 2000. In 2001, FDI inflow was at a near average level of $5.5 billion. The principal source of FDI has been the United States, but in 2002, FDI from the United States amounted to a negative flow of $1 billion. Other principal sources of FDI have been Canada, Spain, the United Kingdom, South Africa, Australia, and Japan. In 2002, the lead areas for FDI were transportation, telecommunications, and mining.

In terms of portfolio investment, by 2001 the number of companies listed on the Chile Stock Exchange and their market valuation had dropped from their peak in 1997 (before the Brazilian currency crisis) of 295 listed companies valued at $72 billion to 249 listed companies valued at $56.3 billion. As of 31 December 2001, US investors held $5.4 billion in Chilean securities, $1.92 billion in equity shares, $3.5 billion in long-term debt, and only $1 million in short-term debt.

With $64.4 billion invested between 1974 and 2003, had the highest FDI per capita and the highest FDI to GDP ratio of the major economies in Latin America. Capital inflows as a percentage of GDP reached a yearly average of 6.4%. In the first three quarters of 2004, FDI totaled $6.5 billion—a 219% increase over the same period in 2003. This was however an exceptional year and the result of two large investments made by Spanish companies.

ECONOMIC DEVELOPMENT

Chile established two free trade zones: the Free Zone of Iquique (ZOFRI) in the northern tip (Region I), and the Free Zone of Punta Arenas (PARANEZON) in the southern tip (Region XII) during the 1970s to encourage trade. Chile has been negotiating for admission into the North American Free Trade Agreement (NAFTA) since 1994, but the process has been stalled by the US Congress. Chile is a member of the South American Mercosur free-trade bloc. Through its concentration on value-added exports and increased foreign direct investment, Chile has become one of Latin America's most-developed nations. Economic growth had averaged over 5% annually since 1985, and was 7.9% during 1988–98. Under the Alywin administration, the population living in poverty dropped by 800,000 to 4.5 million and real incomes of the poorest workers increased by 20%.

Chile's debt management has been very effective. The government negotiated a favorable rescheduling with its creditor banks of its 1991–94 debt maturities. The government's economic policies also kept consumer price inflation limited to an average of 13.6% during 1990–95, down from the annual average of 20.6% during the 1980s, lowering the rate to 4.7% by 1998. Social expenditures, especially those aimed at improving human capital, rose since 1991 to 15% of gross national product (GNP), and were funded through increased surtaxes. For example, the Program for Youth Labor Training focuses on the high levels of poverty and unemployment among youth. President Lagos, inaugurated in 2000, aimed to bring public accounts into balance by 2001 (after the 1998 financial crisis).

The Lagos government increased consumption taxes (VAT and duties on alcohol, diesel, and tobacco) to finance its healthcare plan and a program aimed at supporting the 225,000 families living in extreme poverty. In late 2003, a gradual tightening of monetary policy was expected, as was a narrowing of fiscal deficits. Corruption scandals adversely affected the business climate, yet investment in Chile has been strong. The government's role in the economy is limited, and Chile's economy is open and marketoriented. The finance sector has grown faster than other areas of the economy in recent years. The country's large service sector is thriving, with services being modern and competitive (especially telecommunications). Economic activity remains concentrated in the central region of the country, around Santiago and the Valparaíso region.

Economic growth was slower in 2005 as compared to the previous year—a decrease in copper exports (due to a switch by mining companies to ores rich in molybdenum) was the main cause of this decrease. Imports of good and services, on the other hand, have risen by more than 14%. Growth rates were expected to continue a downward trend in 2006 (as a result of slow investment growth), but were likely pick-up again in 2007 (owing to an increase in exports).

SOCIAL DEVELOPMENT

Prior to the 1973 coup, Chile had built one of the most comprehensive social welfare systems in the world, with over 50 separate agencies participating in programs. Following the military's accession to power in 1973, many of the welfare benefits were suspended, and regulations lapsed. From 1974 to 1981, the junta remodeled the welfare system along the lines of private enterprise.

A mandatory private insurance system was introduced in 1981. Pensions are financed exclusively by workers, whose contributions can amount to over 20% of earnings; employers are not required to contribute, and the government provides subsidies for a guaranteed minimum pension. Retirement is set at age 65 for men and at age 60 for women. Medical benefits are available to wage earners and salaried employees. Workers medical benefits include necessary medical, dental, and pharmaceutical, hospitalization, and rehabilitation. The government funds the Unified Family Allowance system, which provides family allowances.

Sexual abuse and domestic violence are becoming increasingly addressed by the government. It was estimated that over half of Chilean women experience some form of domestic abuse. Legislation implemented in 2004 specifically targeted child pornography. There were no laws regarding sexual harassment in the workplace, although it is recognized as a problem. The average earnings of women with university training were only 60% of those of men with equivalent backgrounds. The labor code provides benefits for pregnant workers.

Excessive use of force by police has been reported, as well as failure to observe due process of law and other human rights abuses toward detainees. The indigenous population continued to suffer discrimination.

HEALTH

As of 1999, total health care expenditure was estimated at 5.9% of GDP. In 1995, the public health system included 187 hospitals, 230 urban outpatient clinics, 146 rural outpatient clinics, and over 1,000 rural health posts.

Chile made considerable progress in raising health standards. The infant mortality rate declined from 147 per 1,000 live births in 1948 to 8.80 in 2005. The maternal mortality rate was 20 per 1,000 live births in 1998. The birth rate was an estimated 16 per 1,000 people as of 2002. Approximately 43% of married women (ages 15 to 49) used contraception. Average life expectancy in 2005 was 76.58 years. In 1995, the leading causes of death per 100,000 were diseases of the circulatory system (150), cancer (116), injuries or accidents (64), and respiratory diseases (61).

In 2004, Chile had an estimated 109 physicians, 63 nurses and 43 dentists per 100,000 people. In the same year, there were 196 general hospitals in the public sector, as well as 526 primary care clinics and 1,840 rural outpatient clinics. There were 223 privatesector hospitals with 11,000 beds.

An estimated 15% of Chileans, including 10% of children under the age of five, fell below the minimum nutritional requirements established by the UN Food and Agriculture Organization. Protein deficiency among the general population has induced an abnormally high rate of congenital mental handicap. In 2000, 94% of the population had access to safe drinking water and 97% had adequate sanitation.

The HIV/AIDS prevalence was 0.30 per 100 adults in 2003. As of 2004, there were approximately 26,000 people living with HIV/AIDS in the country. There were an estimated 1,400 deaths from AIDS in 2003. Altogether, 90% of the country's AIDS victims have been men and 10% have been women; the incidence among women is increasing.

HOUSING

The Allende government expanded the housing program following the 1970 housing census, which enumerated 1,860,111 housing units in the country. In 1971, 6.5% of the national budget was expended on public housing, mainly for the poor, and the state built 76,079 new housing units. The military government, on the other hand, stressed the role of the private sector in the housing market. In 1974, the number of new units built by the public sector was 3,297, compared to 17,084 units built privately; the corresponding figures for 1984 were 276 and 46,493. From 1981 through 1985, the number of new units built was 201,244. The number of new dwellings completed jumped from 88,000 in 1991 to 106,000 in 1992.

In 2001, the government had pledged to build at least 25,000 basic homes per year for low-income and poverty stricken residents. The government also set up a subsidy program for those who could not obtain a mortgage. With such assistance, the government estimates that about 130,000 families currently living in squatter villages or slums can be relocated to permanent dwellings by 2007.

As of 2002, there were about 4,399,952 dwellings across the country; about 90% of all housing units were occupied. The majority of all housing (81.6%) were detached homes. About 84.9% of all dwellings were located in urban areas. About 98% of all housing was privately owned; about73% were owner occupied. Of the privately owned housing stock, about 96% were permanent structures. As of 2003, the housing deficit was estimated at 1,164,629 homes.

EDUCATION

Chile's present educational system stems from a 1965 reform program that called for curriculum modernization (with new texts for all grade levels), teacher training, and professional educational planning and management. There are both state-run and private schools; all state schools provide free education. As of 2004, general education was compulsory for 12 years (for students between the ages of 6 and 18). This includes eight years of primary school and four years of secondary school. At the secondary level, students choose to follow a humanistic-scientific course of study or a technical-professional program. The academic year runs from March to December. The primary language of instruction is Spanish.

In 2001, about 77% of all children between the ages of three and five were enrolled in some type of preschool program. Primary school enrollment in 2003 was estimated at about 86% of age-eligible students. The same year, secondary school enrollment was about 79% of age-eligible students. Nearly all students complete their primary education. The student-to-teacher ratio for primary school was at about 34:1 in 2003. The ratio for secondary school was about 33:1. In 2003, private schools accounted for about 46.5% of primary school enrollment and 48.2% of secondary enrollment.

The University of Chile (founded as Universidad Real de San Felipe in 1738) and the University of Santiago de Chile (founded as Universidad Técnica del Estado in 1949) are national universities with branches in other cities. There are numerous institutions which provide vocational and technical education. There are also several Roman Catholic universities. In 2003, about 42% of the tertiary age population were enrolled in some type of higher education program. The adult literacy rate for 2004 was estimated at about 95.6%, with a fairly even rate bewteen men and women.

As of 2003, public expenditure on education was estimated at 4.2% of GDP, or 18.7% of total government expenditures.

LIBRARIES AND MUSEUMS

Chile's principal libraries and museums are in Santiago. The three most notable libraries are the National Library (3,700,000 volumes in 2002), the central library of the University of Chile (41 libraries with an aggregate of over 1,000,000 volumes), and the Library of Congress (750,000). Other significant collections include the Severín Library in Valparaíso (101,000) and the library of the University at Concepción (420,000). The Catholic University of Chile in Santiago has more than a dozen branches holding 500,000 volumes. Public libraries are coordinated through the Directorate of Libraries, Archives and Museums. In 2003, there were about 319 municipal libraries and smaller 45 branch libraries nationwide. The Directorate also sponsored 19 prison libraries and 17 hospital libraries.

Chile's most outstanding museums are the National Museum of Fine Arts, the National Museum of Natural History, and the National Museum of History, all in Santiago, and the Natural History Museum in Valparaíso. The Chilean Museum of Pre-Columbian Art in Santiago has one of the hemisphere's finest collections of indigenous artifacts, including textiles, ceramics, metals, and stonework from the Mapuche, Aymara, Tiahuanaco, Atacoma, and Arauconion cultures. There are dozens of historical, public affairs, and ethnographic museums throughout the country.

MEDIA

An extensive telegraph service, about three-fourths of which is state-owned, links all the principal cities and towns. International links are supplied by worldwide radiotelephone service and by international telegraph companies. In 2003, there were an estimated 221 mainline telephones for every 1,000 people; about 32,300 people were on a waiting list for telephone service installation. The same year, there were approximately 511 mobile phones in use for every 1,000 people.

Radio Nacional de Chile is a publicly owned station, but numerous private stations exist. As of 1999 there were 180 AM and 64 FM radio stations and 63 television stations. The National Television Council is in charge of monitoring the content of broadcasting for violence and sexually explicit materials. In 2003, there were an estimated 759 radios and 523 television sets for every 1,000 people. About 57 of every 1,000 people were cable subscribers. In 2003, there were 119.3 personal computers for every 1,000 people and 272 of every 1,000 people had access to the Internet. There were 274 secure Internet servers in the country in 2004.

There are over 30 major daily newspapers, the largest of which are in the Santiago-Valparaíso area, where the most important magazines are also published, including the state funded La Nación. Among the best-known magazines are Caras, (1995 circulation 18,000) and Qué Pasa? (20,000). The newspaper El Mercurio (founded in 1827) claims to be the oldest newspaper in the Spanish-speaking world. The El Mercurio chain includes La Segunda and Las Últimas Noticias of Santiago, El Mercurio of Valparaíso, and El Mercurio of Antofagasta.

In Santiago, the leading daily newspapers (with 2004 circulation) are La Tercera (180,000), La Cuarta (NA), Las Últimas Noticias (120,000), El Mercurio (112,000), La Nación (NA), La Segunda (25,000), and Diario Oficial (NA). In Valparaíso the leading daily is El Mercurio de Valparaíso, with a 2004 circulation of about 65,000. The leading daily in Concepción is El Sur, which had a 2004 circulation of 20,000.

Many of Chile's newspapers and periodicals were closed for political reasons in the aftermath of the 1973 military coup. The lifting of the second state of siege in mid-1985 brought a significant improvement in the area of the freedom of the press. Opposition magazines resumed publication, and editors were no longer required to submit copy to government censors prior to publication; radio and television programs featuring political debates reappeared in the last half of 1985. The print and broadcast media, as of 1999, is largely independent, and the government is said to fully support a free press and free speech.

ORGANIZATIONS

The members of many workers' organizations have formed consumer cooperatives. Producer cooperatives also are common, particularly in the dairy industry. The National Society of Agriculture has been politically very influential, and the minister of agriculture has been frequently drawn from its ranks. Representative of the many industrial, commercial, and professional organizations are the National Mining Society, Society of Industrial Development, Commercial Union Society, National Press Association, Medical Society, Chilean Medical Association, Agronomers' Society, Geographical Society of Chile, the Computer Science Society and Scientific Society.

The Consumers International Regional Office for Latin America and the Caribbean is located in Santiago. The Confederation for Production and Commerce is an official organization representing the country's industrialists and traders. The Chilean Chamber of Commerce, with its headquarters in Santiago, is the central organ for all chambers of commerce and most trade associations.

The National Academy of Fine Arts was established in 1964. Other educational organizations include the Academy of History and the Center for Investigation and Development of Education. There are several organizations for medical research and education in specialized fields.

Among fraternal organizations, the Masonic Order is prominent. Among the more politically potent organizations are the professional middle-class guilds (gremios), which were instrumental in bringing down the Allende government. Social development corporations, comprising mainly business people, have been organized regionally to deal with various welfare problems. Rotary and Lions clubs are also active among the business community.

The National Council of Sports is the overall confederation of athletic associations. Many of the national sports associations are affiliated with international organizations as well. There are youth organizations affiliated with major political parties. The Council of Student Federations of Chile (CONFECH) is a coordinating body for student unions. Scouting programs are active through the Guide and Scout Association of Chile. There are also chapters of the YMCA and YWCA. National women's organizations include the Association of University Women and the Centro de Estudios para el Desarrollo de la Mujer.

There are chapters of Greenpeace, Amnesty International, Defense for Children, Habitat for Humanity, and the Red Cross.

TOURISM, TRAVEL, AND RECREATION

Tourist attractions include the Andean lakes of south-central Chile and the famed seaside resort of Viña del Mar, with casinos rivaling those of Monaco. Also popular is Robinson Crusoe Island in the Pacific. Another Pacific dependency, Easter Island (Isla de Pascua), with its fascinating monolithic sculptures, is a major attraction. The giant Christ of the Andes statue, which commemorates the peaceful settlement of the Chilean-Argentine border dispute in 1902, is located on the crest of the Andes overlooking the trans-Andean railway tunnel. Santiago is noted for its colonial architecture, as well as the largest library in South America. Popular national parks include Parque Nacional Lanca in the north, the Nahuelbuta Park near Temuco, and Terres del Paine in the far south. Chilean ski resorts, notably Portillo near Santiago, have become increasingly popular.

The most popular sport in Chile is football (soccer). Other pastimes include skiing, horse racing, tennis, fishing in the Pacific for marlin and swordfish, and some of the world's best trout fishing in the Lake District.

Tourists need a valid passport to enter Chile. A visa is not required for a stay of 90 days or less. There were about 1.6 million tourist visits reported in 2003; around 63% were by visitors from South America. Tourism receipts totaled $1.3 billion. That year there were 52,362 total hotel rooms with 117,905 beds and an occupancy rate of 32%. The average length of stay per visit was two nights.

In 2004, the US Department of State estimated the daily cost of staying in Chile at $198.

FAMOUS CHILEANS

Chile's first national hero was the conquistador Pedro de Valdivia (1500?–53), who founded Santiago in 1541. The Indian leader Lautaro (1525–57), another national hero, served Valdivia as stable boy and then escaped to lead his people to victory against the Spanish. His exploits are celebrated in the great epic poem La Araucana by Alonso de Ercilla y Zúñiga (1533?–96), a Spanish soldier. Bernardo O'Higgins (1778–1842), a leader of the fight for independence, was the son of the Irish soldier of fortune Ambrosio O'Higgins (1720?–1801), who had been viceroy of Peru. Diego Portales (1793–1837) helped build a strong central government. Admiral Arturo Prat (1848–79) is Chile's most revered naval hero because of his exploits during the War of the Pacific. Arturo Alessandri Palma (1868–1950), who became president in 1921, initiated modern sociopolitical reform. Salvador Allende Gossens (1908–73), the Western Hemisphere's first freely elected Marxist head of state, served three years as Chile's president (1970–73), initiating a broad range of socialist reforms and dying in the throes of a violent military coup in September 1973. The coup's leader was Gen. Augusto Pinochet Ugarte (b.1915), a former commander-in-chief of the army. Outstanding church figures have been Crescente Errázuriz (1839–1931), archbishop of Santiago, and his successor, José Cardinal Caro (1866–1958). Benjamin A. Cohen (1896–1960) was an undersecretary of the United Nations.

Three distinguished historians, Miguel Luis Amunátegui (1828–88), Diego Barros Arana (1830–1907), and Benjamin Vicuña Mackenna (1831–86), brightened the intellectual life of the second half of the 19th century. José Toribio Medina (1852–1930) gained an international reputation with works ranging from history and literary criticism to archaeology and etymology. Important modern historians include Francisco Antonio Encina (1874–1965), Ricardo Donoso (1896–1985), and Arturo Torres Rioseco (1897–1971), who was also a literary critic. Benjamín Subercaseaux (1902–73) was a popular historian as well as a novelist.

The first indigenous literary movement was that of the "generation of 1842." One of its leaders was the positivist writer José Victorino Lastarria (1817–88). The novelist and diplomat Alberto Blest Gana (1830–1920) wrote panoramic novels about Chilean society in the tradition of Balzac. Twentieth-century writers include novelist Eduardo Barrios (1884–1963), an explorer of the abnormal psyche; Joaquín Edwards Bello (1887–1968), an author of realistic novels of urban life; the symbolic novelist, poet, and essayist Pedro Prado (1886–1952); and novelist José Donoso (1925–96). Isabel Allende (b.1942) is a world-famous novelist and niece of Salvador Allende; her novel The House of Spirits (1982) was made into a film. Ariel Dorfman (b.1942) is a Jewish Argentine-Chilean novelist, playwright, essayist, and human rights activist: Death and the Maiden is his most famous play. He teaches at Duke University but divides his time between the United States and Santiago.

Poets of note include Gabriela Mistral (Lucila Godoy Alcayaga, 1889–1957), who won the Nobel Prize in 1945; Pablo Neruda (Neftalí Ricardo Reyes, 1904–73), the nation's greatest poet, who was awarded a Stalin Prize as well as the Nobel Prize (1971); and the poet-diplomat Armando Uribe Arce (b.1933).

The nation's first native-born composer was Manuel Robles (1780–1837); Silvia Soublette de Váldes (b.1923) is a leading composer, singer, and conductor; and Gustavo Becerra (b.1925) is a composer and teacher. Claudio Arrau (1903–91) was one of the world's leading concert pianists. Well-known painters are Roberto Matta (1911–2002) and Nemesio Antúnez (1918–1993), while sculptors include Lily Garafulic (b.1914) and Marta Colvin (1917–1995).

DEPENDENCIES

Easter Island

About 3,700 km (2,300 mi) w of Chile is Easter Island (Isla de Pascua or Rapa Nui), a volcanic island roughly 24 km (15 mi) long by 16 km (10 mi) wide. Easter Island is inhabited by a mostly Polynesian-speaking population and a few hundred people from the mainland. Easter Island's population exceeded 2,000 in the mid-1990s. The people raise bananas, potatoes, sugarcane, taro roots, and yams. The island is famous for its moai, the massive monolithic stone heads of unknown origin, carved from tufa (a soft volcanic stone). The cryptic sculptures have attracted increasing numbers of visitors to the island from both mainland Chile and around the world. In 1975, the government engaged Spanish consultants to undertake major tourist development on the island. The number of tourist arrivals has been increasing since the 1980s. In 1986, about one-third of the island was a national park.

Easter Island was discovered by Edward Davis, an English buccaneer, in the late 1680s and was named on Easter Day 1722 by Roggeveen, a Dutch navigator. Claimed by Spain in 1770, the island was taken over by Chile in 1888 and is now administered as part of Valparaíso Province.

Diego Ramírez Islands

About 100 km (60 mi) sw of Cape Horn, at 56°30′ s and 68°43′ w, lies the small, uninhabited Diego Ramírez archipelago.

Juan Fernández Islands

Some 580 km (360 mi) w of Valparaíso, at 33°36′ to 48′ s and 78°45′ to 80°47′ w, is a group of rugged volcanic, wooded islands belonging to Chile. The two principal islands, about 160 km (100 mi) apart e–w, are Robinson Crusoe, formerly Más a Tierra (93 sq km/36 sq mi), and Alejandro Selkirk, previously Más Afuera (85 sq km/33 sq mi); the smaller island of Santa Clara (or Goat Island) is off the southwest coast of Robinson Crusoe. The chief occupation is lobster fishing. Discovered by Juan Fernández around 1563, the islands achieved fame in 1719, when Daniel Defoe wrote Robinson Crusoe, generally acknowledged to have been inspired by the experiences of Alexander Selkirk, a Scottish sailor who quarreled with his captain and was set ashore at his own request on Más a Tierra, where he lived alone until he was rescued (1704–09). The islands are administered by Valparaíso Province.

Sala-y-Gómez Island

About 3,380 km (2,100 mi) w of Chile and some 400 km (250 mi) ene of Easter Island, at 26°28′ s and 105°28′ w, lies arid, volcanic Sala-y-Gómez Island. Almost 1,200 m (4,000 ft) long and about 150 m (500 ft) wide, this uninhabited island belongs to and is administered by Valparaíso Province.

San Ambrosio Island

Volcanic San Ambrosio Island, uninhabited, lies 965 km (600 mi) w of Chile, at 26°21′s and 79°54′ w, rising to 479 m (1,570 ft).

San Félix Island

Situated 19 km (12 mi) ese of San Ambrosio Island, at 26°17′ s and 80°7′ w, is small, uninhabited San Félix Island (about 8 sq km/3 sq mi). Of volcanic origin, the island rises to about 180 m (600 ft). The islet of González is at its southeastern tip. San Félix, along with San Ambrosio, was discovered in 1574.

Chilean Antarctic Territory

Chile claims the section of Antarctica lying between 53° w and 90° w, the Antarctic (or O'Higgins) Peninsula, parts of which are also claimed by Argentina and the United Kingdom.

BIBLIOGRAPHY

Barr-Melej, Patrick. Reforming Chile: Cultural Politics, Nationalism, and the Rise of the Middle Class. Chapel Hill: University of North Carolina Press, 2001.

Bizzarro, Salvatore. Historical Dictionary of Chile. Lanham, Md.: Scarecrow, 2005.

Caistor, Nick. Chile: A Guide to the People, Politics and Culture. New York: Interlink Books, 2002.

Calvert, Peter. A Political and Economic Dictionary of Latin America. Philadelphia: Routledge/Taylor and Francis, 2004.

Castiglioni, Rossana. The Politics of Social Policy Change in Chile and Uruguay: Retrenchment Versus Maintenance, 1973–1998. New York: Routledge, 2005.

Castillo-Feliú, Guillermo I. Culture and Customs of Chile. Westport, Conn.: Greenwood Press, 2000.

Chile's High Growth Economy: Poverty and Income Distribution, 1987–1998. Washington, D.C.: The World Bank, 2002.

Collier, Simon. A History of Chile. Cambridge: Cambridge University Press, 1996.

Drake, W. and Ivan Jaksic. The Struggle for Democracy in Chile, 1982–1990. Rev. Ed. Lincoln: University of Nebraska Press, 1995.

Health in the Americas, 2002 edition. Washington, D.C.: Pan American Health Organization, Pan American Sanitary Bureau, Regional Office of the World Health Organization, 2002.

Lawson, George. Negotiated Revolutions: The Czech Republic, South Africa and Chile. Burlington, Vt.: Ashgate, 2005.

Spooner, Mary Helen. Soldiers in a Narrow Land: The Pinochet Regime in Chile. Berkeley: University of California Press, 1994.

CHILE

Republic of Chile

República de Chile

COUNTRY OVERVIEW

LOCATION AND SIZE.

A coastal country located in the southwest region of South America, Chile has an area of 756,950 square kilometers (292,258 square miles) and a total coastline of 6,435 kilometers (3,998 miles). Chile shares its northern border with Peru and its eastern border with Bolivia and Argentina. Comparatively, the area occupied by Chile is nearly twice the size of California. Chile's capital city, Santiago, is located at the country's latitudinal mid-point. By bus, Santiago is approximately 1.5 hours inland from the Pacific Ocean and 1.5 hours west of the Andes Mountains foothills. From its northern border to its southernmost tip, Chile covers a diverse geographic array. In the north is the Atacama Desert, one of the driest places on earth, while the southern tip points towards the polar ice of Antarctica.

POPULATION.

The population of Chile was estimated at 15,153,797 in July of 2000 with an annual growth rate of 1.7 percent, an increase of 7.9 percent from the 1994 population of 13,950,557. In 2000 the birth rate stood at 17.19 per 1,000 while the death rate stood at 5.52 per 1,000. According to the Population Reference Bureau, with a projected annual population growth rate of 1.29 percent, the population is expected to reach 19.55 million by the year 2025 and 22.21 million by 2050.

A majority of the Chilean population is mestizo (of mixed European and American Indian descent). In 1848 the Law of Colonization was passed by Spanish colonists interested in attracting foreign immigrants. Consequently, a large German population relocated to Southern Chile and mixed with the Mapuche Indians who inhabited the region. Miscegenation (intermarriage between different races) was prevalent throughout the country between Mapuches and other Europeans. Immigration also produced significant populations of Palestinians, Jews, Italians, Asians, Yugoslavs, and Greeks. Because of this great racial diversity, most Chileans feel that there is little racial prejudice in their country. However, prejudice based on class status is very prevalent in the urban centers.

The population of Chile is highly stratified with the middle class being the largest social sector. The importance of surnames, private schools, and living in the right neighborhood reveals a society that places much emphasis on class. The upper class in Chile consists of aristocrats, big business executives, and highly trained professionals making US$6,000 or more per month and constituting approximately 10 percent of the population. The middle class consists of small-business people, lower-rank professionals, public employees, and teachers. This group averages between US$600-$5,000 per month and constitutes 60 percent of the population. The lower class includes indigenous groups, retirees, students, small farmers, and servants. These people make between US$75-$500 per month and make up 30 percent of the population.

The population of Chile is highly urbanized, with 86 percent of the population residing in urban areas. The country is also young, with 28 percent of the population under the age of 15. Additionally, the population is predominantly Roman Catholic (estimated at 89 percent), with the remaining 11 percent affiliated with other religions.

OVERVIEW OF ECONOMY

Chile's market-oriented economy is characterized by a high level of foreign trade that has been solidified over the years through economic reforms. Under President Patricio Aylwin's democratic government (1990-93), Chile's reputation grew as the role model for economic reform in Latin America. Gross domestic product (GDP) growth averaged 8 percent during the 1991-97 period but fell to about 4 percent in 1998 because of tight monetary policies implemented by the government; such policies were an attempt to keep the current account deficit in check. In 1999 a severe drought exacerbated the recession by reducing crop yields and causing hydroelectric shortfalls and rationing. For the first time in 15 years, Chile experienced negative economic growth. However, Chile managed to maintain its reputation for strong financial institutions and sound economic policies. By the end of 1999 exports and economic activity had begun to recover, and a return to strong growth was predicted. The March 2000 inauguration of President Ricardo Lagos (2000-present)—President Eduardo Frei's (1994-99) successor—left the presidency in the hands of the center-left Concertacion coalition that has held office since the return to civilian rule in 1990.

Chile arrived at its present strong economic state after years of political and economic turmoil. Civilian governments replaced the repressive military dictatorship in March 1990 and continued to reduce the government's role in the economy, pushing for the development of a free-market economy. Inflation has been on a downward trend and hit a 60-year low in 1998. Chile's currency and foreign exchange reserves are also strong, due in large part to sustained foreign capital inflows of direct investment. Still, the Chilean economy remains largely dependent on a few sectors—namely copper mining, fishing, and forestry. Sustained economic growth is largely dependent on world prices for these commodities, continued foreign investor confidence, and the government's ability to maintain an orthodox fiscal policy .

Chile's credit rating remains the best in Latin America, and in order to finance investment, Chilean firms have raised money abroad through loans, selling bonds, and issuing stock. Additionally, Chile has a high rate of foreign investment with private U.S. corporations conducting a significant amount of independent and joint ventures in the country. Total private and public investment in Chile accounted for 33 percent of the GDP in 1997. The government is aware that increasing investment is necessary to ensure worker productivity. Chile is very fortunate not to be plagued by international debt, in part due to foreign aid it receives. Although it still has a significant foreign debt it is not enough to constitute major structural problems. As such, Chile is better off than many of the lesser-developed Latin American countries that struggle to maintain economic policies designed to generate enough revenue to pay back their foreign debts. Minimal foreign debt pressures and strong economic growth help Chile remain one of the most economically successful countries in Latin America.

POLITICS, GOVERNMENT, AND TAXATION

Chile is divided into 13 administrative regions, each headed by an administrator ( intentente ) appointed by the central government. Each region is divided into 40 provinces, each being administered by a governor ( gobernador ) also appointed by the central government. The provinces are further divided into municipalities headed by appointed mayors ( alcaldes ).

Chile's system of government, with its separation of powers, was patterned after that of the United States. There are 3 branches to the government: executive, judicial, and legislative. It is a multiparty republic with a presidential system based on the 1980 constitution.

The Chilean Constitution of 1980 sets the format for the National Congress, composed of a Senate and a Chamber of Deputies. The Senate has 47 members (38 elected and 9 appointed) who serve 8-year terms. The Chamber of Deputies has 120 members who are directly elected for 4 years. The president is elected for a 6-year term without possibility for re-election. The constitution requires the president to be at least 45 years of age, meet the constitutional requirements for citizenship, and have been born on Chilean territory. The president is elected by an absolute majority of the valid votes cast.

The executive branch in Chile is composed of 16 ministries and 4 cabinet-level agencies: the Central Bank, the Production Development Corporation (Corfo), the National Women's Service, and the National Energy Commission. Each minister is appointed exclusively at the president's discretion.

During the brutal dictatorship of General Augusto Pinochet, which lasted from 1973 to 1990, political parties were severely repressed. After the return to a civilian democratic government, political parties began re-emerging and eventually consolidated into 2 major blocs, the center-right and the center-left. Historically, Chilean politics have been split 3 ways: the right, center, and left. The center-left is currently the governing coalition and includes the centrist Christian Democratic Party (PDC), the Radical parties, the moderate leftist Party for Democracy (PPD), and the Socialist Party (PS). The opposition center-right includes the National Renewal Party (RN) and the Independent Democratic Union Party (UDI). In addition to these parties, Chile has several small-scale leftist parties, including the Communist Party. While these parties are not represented in the Executive Branch or Congress, they do have elected representatives in some local governments.

The 2000 presidential election was a close race between Ricardo Lagos, representing the center-left, and Joaquin Lavin Infante, representing the center-right. Lavin's party platform, as a member of UDI, focused on promises of higher wages, larger pensions, and better economic and social performance. These promises were made in the wake of the largest recession Chile has experienced in years. Lagos's platform, as a member of the PPD, advocated stability, continuation of reform processes tied to economic liberalization , high levels of economic growth, and reduced unemployment.

The Coalition of Parties for Democracy (Concertacion) is an umbrella coalition that encompasses all political parties, from the powerful PDC to Lagos's PPD. One of the fundamental tenants of this bloc was to unite in support of a single presidential candidate. For the 2000 election, the Concertacion elected Lagos, making him the first avowedly leftist president since Salvador Allende, the socialist president who died during the coup (an internal takeover of a government) that put General Pinochet in power. Many older Chileans were concerned about Lagos's candidacy because they still remembered the very severe economic conditions that plagued the country under Allende. As the newly elected president, Lagos promised to maintain the same liberal-economic reform policies that have been adhered to since the overthrow of the Allende government. Although both the center-left and center-right support free-market liberal economies, the center-right tends to identify more with Pinochet and his neoliberal policies. The center-left understands and supports free-market policies but expresses ties to socialist ideology. In Chile, political identification remains closely tied to a person's socio-economic class.

The government's biggest impact on the economy is maintaining neoliberal economic policies that favor foreign investment and international trade. Regulation of the Chilean economy by the government is limited. The most heavily regulated areas of the economy are utilities, the banking sector, securities markets, and pension funds. The government is increasing the amount of foreign investment in the country by introducing rules that permit privatization of Chilean state-owned ports, water-treatment facilities, and private investment in the construction and operation of domestic infrastructure projects.

Chilean Decree Laws attempt to establish favorable investment climates for foreign investors by treating them nearly the same as Chilean investors. There are minimal administrative issues that need to be dealt with in order to pursue investment opportunities in Chile, and the highly stable democratic government helps boost investor confidence. With a well-developed legal system and government support of foreign investment, the economy thrives on the inflow of foreign capital. The government also promotes exports by offering non-market incentives to exporters. For example, paperwork requirements are made simpler for nontraditional exporters.

An 18 percent VAT is applied to all sales transactions and accounts, generating over 40 percent of total tax revenues. There is a tariff on almost all imports originating in countries that have not entered into a free trade agreement with Chile. In 1998 the tariff was 11 percent; it dropped to 9 percent in 2000 and will fall by 1 percent through the year 2003, at which time it will stabilize at 6 percent. Personal income taxes are applied only to individuals making more than US$6,000 per year. People earning over about US$75,000 are taxed at the highest rate of 45 percent. Businesses are taxed 15 percent on the profits they keep as earnings and 35 percent for those that they distribute. Businesses are given tax breaks for their donations to educational institutions. In 1999, 73 percent of total government revenues were derived from taxes. Tax evasion is not a serious problem in Chile.

Chile's economy is extremely open to free trade and the government rarely intervenes with protectionist measures. Chile's Foreign Investment Law and its tax structure are indicative of a country that is interested in attracting foreign investment. Chile has negotiated free trade agreements with various countries, including the United States, Canada, Mexico, Brazil, Paraguay, Uruguay, and Argentina.

The military played a significant role in the economy during the Pinochet dictatorship by enforcing a drastic 180 degree turn in the economy. They changed the Chilean economy from one that was heavily nationalized , domestically protected, and industrializing through import-substitution to one that favored free-market neoliberal policies. While the military no longer plays a direct role in the country's economic planning, the economic structure that was implemented under its rule is still followed currently and policymakers of the military government are still on the boards of the largest firms in the country.

INFRASTRUCTURE, POWER, AND COMMUNICATIONS

Chile's internal transportation network is relatively well-developed, although it is in need of some improvement. Historically, Chile had heavy government regulation of the transportation sector—including railroads, air transport, marine shipping, and buses. These laws served as a tremendous barrier to international competitiveness due to inefficiency. As a result, reforms, begun in the late 1970s, aimed at establishing a competitive environment and increasing participation by the private sector .

RAILWAYS.

The nation's rail system consists of 6,782 kilometers (4,214 miles) of railroads. Four international railways run to northwestern Argentina, Bolivia, and Peru. Two of these lines run from Chile to Bolivia (from Arica to La Paz) and from Antofogasta to La Paz via the Calama Desert. Except for these 2 international routes, passenger service to areas north of Santiago is not permitted. The Chilean State Railways (Empresa de Ferrocarriles del Estado) operates under the auspices of the Ministry of Transport and Telecommunications. Congress approved privatization of EFE's train services. However, the infrastructure remains under state control.

ROADWAYS.

Although Chile's railroad system is the fourth-largest network in Latin America, it is a comparatively slow and inefficient method of transportation. Roads are the principal means of moving people and freight given that the Pan-American Highway is in excellent condition and runs the length of the country. In 1960 the first paved road was completed, linking the extreme north with Puerto Montt, located at the far southern tip of the Central Valley (Valle Central). Transversal roads run east and west from the north-south highways. Chile's network of roads totals approximately 79,025 kilometers (49,103 miles). Of this total network 9,913 kilometers (6,160 miles) are paved, 33,140 kilometers (20,592 miles) are gravel roads, and 35,972 kilometers (22,352 miles) are improved and unimproved earth roads. The Santiago and Central Valley regions are the areas most frequently traveled. There are about 1.1 million motorized vehicles of all kinds in Chile, including approximately 700,000 automobiles and 300,000 trucks and buses. Chile's national bus service and Santiago's

metro system run on time and are considered excellent.

Chile supports an extensive tourist infrastructure through the use of bus transportation from the extreme north of the country to the southern Lake District. A bus trip from the capital city of Santiago to Puerto Montt takes about 17 hours. Although it is a significant amount of time to spend on a bus, the views are extraordinary, Chileans make great conversation, and once you reach the south you get to see one of the most beautiful places on earth. It is almost untouched by capitalist industrialization and the people are comfortingly and inspiringly simple. A portable CD player is a totally foreign object to them.

WATER.

Chile has 4 major state-owned water utilities that are in desperate need of substantial investment to improve efficiency. Starting in 1998 the government began considering the possibility of selling approximately 35 percent of the utilities to private firms. Partially privatizing this sector would allow private companies to invest capital in the restructuring of the utilities. Such contributions would improve drinking water services, sewers, and sewage treatment. These changes require substantial investment in order to be realized. According to the Communication and Culture Secretariat of Chile, a planned investment of US$1.56 billion by the year 2000 was expected to substantially improve the water sector in Chile. This significantly exceeds the US$235 million that was spent in 1998.

PORTS.

Chile's extensive coastline has very few naturally protected bays. In general the sea is rough and the topography is abrupt. A total of 95 percent of Chilean exports and 87 percent of international trade is done through port facilities. As of 1999, Chile had 36 operational ports: 10 were state-owned and offered public service; the other 26 were privately-owned ports, of which only 15 offered public service. These ports tend to focus on trade and shipping.

Port infrastructure, equipment, technology, and services have been clearly inadequate to efficiently serve the growing demands of globalization and international trade. As a result, the Chilean Congress approved a Port Law in December of 1997. This legislation was intended to foster competition and improve the capacity, efficiency, and competitiveness of the state-owned ports. The law mandated the conversion of 10 state-owned ports, previously managed by Emporchi (Chilean Port Authority), into 10 independent companies. These new companies are now fully responsible for port management, development, financial administration, and assets. However, the ports are still owned by the state. Chile has limited inland waterways, navigable for only about 725 kilometers (450 miles), and located mainly in the southern Lake District.

AIR TRANSPORT.

Air transport has become an important way of moving people and freight through Chile, given its territorial extremes. Chile has 351 usable airports but only 48 of them have paved runways. The international airport is located in the capital, Santiago. Eighteen international airlines serve through Santiago. Chile has 2 national airlines. The first is Línea Aérea Nacional de Chile (LAN Chile), which was privatized in 1989 and merged with Southeast Pacific in 1992. LAN Chile serves major cities in Chile and also carries passengers to international destinations. The second, Linde Aérea del Cobre (Ladeco), is owned by the country's copper company and handles the majority of domestic travel.

ELECTRICITY.

Power shortages occurred frequently in 1999 and to some degree in 1998. Shortages are typically a result of drought conditions since most of the country depends heavily on hydroelectricity. Power rationing had to be instigated in Santiago and some other regions for a while. In April 1999, blackouts would occur for up to 3 hours a day. The government did not intervene in the situation because private corporations own the electric companies, and the government did not want to scare investors away. However, the blackouts continued to be severe enough that the government fined 10 power companies for not meeting the terms of their contracts. New power plant construction, started in 1996, will continue through at least 2008. According to the most recent projections of the Comision Nacional de Energia (National Energy Commission [CNE]), electricity demand will grow over 8 percent yearly into the next century. Thus, the electricity sector has grown much faster than the overall Chilean economy.

TELECOMMUNICATIONS.

Chile has an excellent telecommunications infrastructure supporting the use of cable, fax machines, telephones, and the Internet (in 1999 there were 26 Internet service providers). The phone system is completely digital and there are 8 international long distance carriers and 3 cellular telephone networks.

The telecommunications sector in Chile changed dramatically once it became privatized in 1989. As a result, private companies were forced to compete on the open market. Competition caused these businesses to provide their services in the most efficient and effective manner possible in order to ensure customer satisfaction. Since privatization, the number of phone lines increased from 800,000 in 1990 to 3.1 million in 1999. Cellular phones were introduced in 1990, and by the end of 1999 there were more than 2 million being used nationwide. Long distance calls made within the country increased from 500 million minutes in 1990 to almost 3 billion minutes in 1999. Long distance calls made to other countries increased from 50 million minutes in 1990 to almost 250 million minutes in 1999.

The Internet has become efficient in Chile due to heavy U.S. investment, but penetration is still limited given that only about 24 percent of homes have a computer. However, computer use is expected to grow 6 percent in the year 2001, as consumer confidence resumes after the Y2K scare. Chilean imports of computer equipment were estimated at approximately US$400 million for 1999. Imports have been gradually increasing over the past few years. The Internet is used mainly for education and entertainment purposes with only about 7 percent of Internet users shopping on-line. Furthermore, local access charges on Internet usage make logging on expensive. Nevertheless, Chile has the most developed telecommunications infrastructure in Latin America and is attempting to further develop its Internet infrastructure through private investment in order to become the preferred country for Internet investments.

RADIO.

The radio is Chile's principal way of reaching the mass population. An estimated 93 percent of the nation's population listens to the radio; the percentage is higher in the metropolitan Santiago area, estimated at 97 percent. Radio broadcasts are the prime source for current news for a majority of the population. New stations have a large budget used to maintain professional news staff to meet the news demands of the country. There are an estimated 17 million radio sets in Chile, far surpassing the estimated population of the country.

ECONOMIC SECTORS

The key economic sectors making up the Chilean economy are agriculture, industry and manufacturing, and services. Agriculture has increased slightly over the years but still makes up only a small percent of annual GDP. In 1979 agriculture constituted 7.4 percent of the GDP, rising to 8.7 in 1989, and 8.4 in 1998. Industry constituted 37.9 percent of GDP in 1979, with 21.6 of that coming from manufacturing. In 1989 those figures were 41.8 and 18.9 percent, respectively. By 1998, industry declined to 34.2 percent and manufacturing sank further, to 16.4 percent. The service sector in Chile accounted for approximately 61 percent of the GDP in 1999. Services in Chile include tourism, banking, and finance and retail .

AGRICULTURE

In 1970 Chile was exporting US$33 million in agriculture, forestry, and fishing products. By 1991 exports had increased substantially to US$1.2 billion. Currently, exports of agricultural products constitute approximately 6 percent of the total GDP. However, this sector of the economy is extremely susceptible to fluctuations in world demand.

FRUIT.

Chile is the region's leading fruit exporter, with the agricultural sector employing about 14 percent of the workforce in 1997 and contributing around 6 percent to the GDP in 1999. The fruit industry is the most developed and high-profile agricultural industry. Chile is said to be the world's largest exporter of table grapes, not counting the ones used in the well-developed wine industry. Both of these industries benefit from the favorable conditions of the country's fertile and well-drained soil, cheap labor, and in recent years, government policies. About 25 percent of grapes eaten in the United States are imported from Chile, as well as 35 percent of kiwi fruit and 10 percent of nectarines. Other major crops include apples, apricots, pears, and avocados. About 50 percent of Chile's fruit production is exported, mainly to the United States and Europe. One of the greatest advantages of this sector is that it coincides with the northern hemisphere's winter season. Between 1989-91, exports of fresh fruits reached significant importance. Grape exports to the northern hemisphere during the winter season were a virtual Chilean monopoly until Argentina began to compete. The fruit packing industry also expanded, providing seasonal employment to thousands of workers.

WINE.

Chilean wines have earned a prestigious position among international wine connoisseurs. The quality of these wines have earned Chile a spot as one of the world's leading wine producers, behind Italy and France. Chilean wine exports increased significantly between 1987 and 1998 (from 14 million liters to 229 million liters). In 1993-98, wine exports increased from US$129 million to US$500 million. Favorable climate and soil conditions make growing premium grapes an asset for this sector of the Chilean economy. Chile's microclimates (climates of a very small area) provide outstanding soil, sunlight, temperature, and moisture conditions for wine production.

Additionally, the industry has introduced new technologies and attained a highly skilled labor force . Industry upgrades in technology and production processes have been facilitated through foreign investment in local operations. France, the United States, Australia, and the United Kingdom have had successful Chilean operations since 1979.

FISHING.

Chile's extensive coastline makes it one of the world's greatest fishing nations. The natural conditions— including favorable currents, tides, rainfall, and inland water—provide for a large harvest of fish products. Chile has developed an advanced technology for use in fishing and aquaculture. Most Chilean fish products are now shipped frozen and pre-packaged. In 1994 Chile was the largest producer of finfish and shellfish with a 7 million ton catch, approximately 6 percent of the world's total. Fishing accounts for 2 percent of Chile's GDP and 11 percent of its global exports. In 1985 the sale of frozen and pre-packaged products stood at 1,120 tons. By 1998 this figure had significantly increased to 294,062 tons.

The Chilean fishing industry produces high quality fish meal, fish oil, salmonids, sea bass, Antarctic whiting, kingclip, swordfish, sea urchin, oysters, scallops, and king crab. Finfish and shellfish exports in 1998 were worth US$1.6 billion, an increase of 31 percent over 1997 exports. About 52.7 percent of 1998 exports were harvested at sea with 47.3 percent being produced through inland aquaculture.

Chile is one of the top 15 aquaculture nations in the world. Since the 1980s Chilean aquaculturalists have worked hard to become the second largest producers of salmon and trout. They raise Coho, Atlantic, and Chinook salmon, as well as rainbow trout. The industry is made up of 90 firms operating 185 farms in over 47,000 hectares of inland waters. Importers of refrigerated and frozen Chilean salmon include Japan (60 percent), the United States, Brazil, and the European Union. In 1998 salmon sales provided approximately 42 percent of industry revenue and accounted for greater than 4 percent of global country exports.

FORESTRY.

Chilean forestry is extremely successful due to its natural resource endowments. Chile's competitive advantage is due to an abundance of water, diversified climates throughout the country, and fertile soil. For example, the locally grown Radiata Pine reaches maturity in 15 to 30 years, much faster than in its own native homeland of Monterey, California. Moreover, the industry growth can be attributed to extensive research and species introduction coordinated through the efforts of public and private universities, government agencies, and private institutions.

In 1998 forest exports reached an impressive US$1.66 billion, although this was down 9.3 percent from 1997. These export levels are achieved by 100,000 workers in approximately 800 small, medium-sized, and large firms that make up the industry. In 1998 Chile sold forest products to 95 countries, with Asia leading at 34.8 percent, followed by North America with 24 percent, and Europe at 23 percent. The United States was the single largest buyer with imports totaling US$358 million.

The success of the forestry industry has attracted much foreign investment and has contributed to the globalization that is characteristic of the Chilean economy. In 1998 a U.S.-based company, Boise Cascade, undertook a joint venture with the Chilean company Maderas Condor. Both companies invested US$150 million to build a new plant in Valdivia, the lake region of Chile. Additionally, the Canadian firm ForAction International, together with the Chilean company Moreno Vial Ltda., started building a wood production and export plan in the town of Curanilahue, which involves a US$30 million investment.

INDUSTRY

Chile's industry sector is based primarily on local mineral resources, agricultural raw materials, and forestry. Current industries include copper refining, nitrate products, iron smelting and steel production, oil refining, cement, chemicals, timber and pulp, furniture, and various wood products. There is also a large textile, clothing, and leather industry concentrated mainly in the urban centers, with Santiago being the largest, employing 20 percent of the local labor force.

MINING.

Chile is the world's largest producer of copper, constituting 28 percent of the world's reserves. It has the world's most productive mine, located in the northern region in the city of Chuquicamanta. The Chilean economy is also very dependent on copper, and this industry employs about 6 percent of the Chilean workforce. According to the International Monetary Fund (IMF), in 1997 copper accounted for 42 percent of exports and 8 percent of the country's GDP. Major external investment in Chilean copper mining and the many industries across the world that require copper indicate that this sector will continue to play an important role in Chile's economy. North America and Western Europe are the biggest users of copper, constituting a combined world demand of 59 percent.

Corporacion Nacional del Cobre de Chile (CODELCO) is the largest company in Chile engaged in extracting and selling copper from state-owned mines. CODELCO is owned by the Chilean government and received annual profits of around US$1 billion per year during the 1990s. It is responsible for producing 10 percent of the world's copper.

Before the 1970s most copper mines were owned by American multinational corporations ; in 1971 these mines were nationalized by the Chilean government. CODELCO was created in 1976 by the military government to run the nationalized copper mines. Thus, the Chilean government had a monopoly over the large mines, accounting for 85 percent of copper production.

Beginning in 1980 the military government began to loosen its grip on the copper mines, permitting foreign investment in the new large mines. As a result, foreign direct investment in the mining sector grew from approximately US$90 million between the years 1974-89 to US$803 million in 1990. Between the years 1989-95 more than half of the foreign direct investment in Chile went directly to the mining sector. This pattern reflects a strong international demand for copper, a metal that is used in the construction industry, in air conditioning, and in manufacturing electronic equipment. Copper is also used in the automotive industry for electrical equipment and in telecommunications to build copper cables.

Chilean mining companies are also beginning to explore opportunities in other parts of Latin America, specifically Argentina, Bolivia, and Peru. International demand affects the price of copper. In 1998-99 the Asian financial crisis reduced that region's demand for copper, causing the price to significantly decrease. The Asian economies rebounded and the price of copper increased with a positive short-term outlook for the industry.

Northern Chile also has significant amounts of rich, high-grade iron-ore deposits located mainly in Coquimbo. Most of this ore is exported, with the surplus being used by the local iron and steel industry. Chile is also the leading nitrate supplier in the world, with large deposits of the mineral in the Atacama Desert. Nitrate is used for fertilizers and in the production of explosives. The mining and export of this mineral flourished during the last part of the 19th century and the beginning of the twentieth century. Chile produces gold, silver, molybdenum, manganese, zing, lead, bauxite, sulfur, potash, uranium, cobalt, antimony, and tungsten.

TEXTILES.

Chile's textile and garment industry faces strong international competition from Asian manufactures such as China, India, and Indonesia. In order to remain competitive, Chile has broadened its export market and sought new trading partners. In 1998 the top exports were denim cloth, polyester viscose, and combed wool. The leading purchasers of these exports were Argentina, Bolivia, and Brazil. Despite international competition, this sector of the Chilean economy has been able to remain efficient and has even expanded production and sales. Between the years 1993 to 1997, garment exports rose from US$148.2 million to US$208.6 million.

The textile sector has been growing due to Chile's new international trade agreements. MERCOSUR (a free trade agreement between Argentina, Brazil, Uruguay, Paraguay, and Chile) has been the greatest benefit to this industry, accounting for 37 percent of all foreign sales in 1998. The leading buyers of Chilean-made garments in 1998 were Argentina (purchasing US$33.1 million worth of men's and women's suits, ensembles, and hosiery), followed by Bolivia (US$27.8 million), and Mexico (US$21.9 million).

Chile has approximately 2,000 textile and garment companies, with around 30 of them having foreign sales of greater than US$1 million. Some of the top exporters of 1998 include Machasa—Chile's largest producer of denim fabrics—with US$23.1 million in sales, wool fabric manufacturers Bellavista Oveja Tome with US$16.3 million, and Textiles Pollak Hermanos with US$12.3 million.

As of 2000, the textile sector of Chile was the most labor-intensive of industries, with around 160,000 workers. The Textile Institute of Chile, a trade organization, estimated that 9 to 10 new jobs are created with every US$10,000 invested in this industry.

METAL MANUFACTURING.

There has been strong growth in this sector over the past few years, encouraging foreign investment in plants and capital. This industry has over 2,000 firms and provides 100,000 jobs. Metal manufacturing is central to Chilean development efforts, constituting 6 percent of the GDP. Leading export items in 1998 included copper wire (US$75.4 million), automotive vehicles (US$63.9 million), automotive gearboxes (US$39.7 million), and machine parts (US$38 million).

In 1998 this industry earned US$883.2 million from exports, increasing from US$722.4 million in 1996 and US$456.9 million in 1993. Metal manufacturing consists of 2,000 companies, based mostly in central and southorn Chile, and about 20 percent of the total industry work-force. There is a general consensus that Chile has remained competitive in this sector as a result of technological innovation, easily accessible raw material sources, and skilled local engineers. Some of these companies are also partly foreign-owned, keeping in tune with Chile's desire to attract foreign direct investment. For example, Brazil contributed US$80 million in 1997 to build a new hot-rolled steel plant in the town of Colina.

CONSTRUCTION.

The construction sector in Chile is predominantly import-driven. Foreign manufacturers supply over 95 percent of the Chilean market for construction equipment. In 1998 construction accounted for 3 percent of the country's GDP. In 1999, due to a regional recession, the Chilean construction sector was one of the worst performers of the year. Housing construction has an average demand of 140,000 units and 110 million square feet of lumber per year. Over the last decade, new housing construction has averaged 11 percent annual growth while construction as a whole averaged 9 percent growth. During 1998-1999 construction growth declined dramatically, but current signals indicate that by 2001 it should be back on its old growth path. Construction of retail and wholesale space (including warehousing) has also experienced remarkable expansion. As of 2000, new malls (in cities where none existed), large "hypermarkets," and new industrial development projects are regaining their once frantic activity around major cities. Currently, the Chilean government is also promoting the construction of a storm-sewer system for Santiago and other large cities. These projects will require large private investments. Private investors have also announced new large investments in high-rise office buildings. Such projects are expected to be worth close to US$1.5 billion. Future urban developments are expected to contribute US$500 million in private investment over the next 10 years.

GAS AND OIL.

Chile is not a major oil or gas producer, having only occasionally derived more than 50 percent of its consumption from its own reserves. Local oil production in 1992 contributed only 11 percent of total oil consumption and continues declining, while consumption and imports increase. Chile has oil and natural gas fields near the Straits of Magellan and Tierra del Fuego, on the country's southern coast. However, reserves in these sites are quickly being depleted. The National Petroleum Enterprise (Empresa Nacional de Petrole [ENAP]) was created as a Chilean government enterprise in 1950. The objective of its creation was to develop activities related to exploration, importation, and distribution of crude oil products. ENAP has continually sought new ways to meet domestic demand for petroleum by engaging in production contracts with Argentine, Brazilian, Colombian, and Ecuadorian companies. In 1982 domestic production was at 2.48 million cubic meters. In 1986 4.358 million cubic meters of gas were produced. By 1990 production had declined to 1.38 million cubic meters. ENAP estimates for production in 1998 were not expected to reach more than half a million cubic meters. Thus, for that year 90 percent of Chile's consumption was to be imported by ENAP. Since Chile has been experiencing solid economic growth over the last couple of decades, its oil demands have consistently been met through imports from other countries. Petroleum exploration efforts undergone in Chile have proven to be unsuccessful. In 1999 ENAP's general manager issued a statement indicating that exhaustive exploration had failed to find new oil fields and that currently exploited deposits would be depleted within 6 years. Thus, Chile will continue to depend on imports for its gas and oil needs

SERVICES

TOURISM.

Chile is a popular spot for tourism with its extensive natural attractions and exceptional services, with the summer months of January and February being the most popular. Tourists can choose from an array of natural climates including deserts, temperate regions, lake districts, beaches, glaciers, and native forests. Natural wonders and excellent hotel and transportation infrastructures supported 1.8 million tourist visits in 1998. About 45 percent of the tourists come from Argentina. During the summer months Argentineans come to Chile to enjoy the vast array of beaches, Vina del Mar being one of the most popular. Chilean revenues from tourism were estimated at US$1.2 billion in 1998, up 7 percent from 1997. Spain, Germany, and France constitute the majority of European visitors. Two-thirds of all visitors come to Chile for vacations. Due to increased political stability and economic growth in the 1990s, there has been a significant increase in business travelers and convention attendees, accounting for 23 percent of total visitors. The average visitor stays 11 days and spends US$55 per day.

Accommodations in Chile are exceptional with some 1,700 hotels providing over 200,000 jobs. Tourism has been particularly strong in and around metropolitan Santiago. It has 15 five-star hotels—12 in Santiago and 3 in the nearby Valle Nevado ski resort. Chile has 15 ski resorts, making up the most comprehensive skiing infrastructure in Latin America. Another popular spot is the San Rafael Lagoon. Tours take visitors on cruise ships through channels and archipelagos of Aysen, entering into an inlet of the Pacific Ocean to the final attraction, the striking 30,000-year-old San Rafael Glacier. Torres del Paine National Park is located in southernmost Chile and offers striking views of glaciers and challenging climbs.

The Chilean government actively promotes expansion of the tourism industry. The National Forestry Corporation (CONAF) is inviting private foreign operators to provide a wide range of services within Chile's Wildlife Preserve System. Many foreign investors have also started building upscale hotels in Santiago and northern Chile. For example, Marriott International—a U.S. corporation—is building a US$96 million, 42-story, 250-room hotel in Santiago's upscale east end.

BANKING AND FINANCE.

Chile's banking system has changed significantly over the past decade. In the beginning it was relatively exclusive, offering credit only to wealthy Chileans. The rest of the population had to rely on department stores for credit. In the early 1990s the banking sector expanded quickly and began accommodating new account holders and even offering credit cards to average Chileans. Middle-class Chileans are now able to access credit through banks and are offered online "home banking." In 2001, nearly 1 out of every 5 Chileans had a credit card.

The Chilean banking sector is now one of the most developed and promising of the region. But competition from foreign banks is rising as a favorable investment climate has induced many foreign banks to open up shop in Chile. Large numbers of bank mergers have also occurred, raising government concerns over potential monopolies. As of 2001, Spain's Banco Santander Central Hispano (BSCH) controlled both Banco Santiago and Santander Chile, 2 of the largest Chilean banks. BSCH had a market share of nearly 30 percent. Financial authorities have asked it to reduce its share to 20 percent.

During Allende's presidency the financial system of Chile was near collapse. However, under the new dictatorship the financial sector experienced a remarkable boom, improving significantly between 1975-1990, with the implementation of an orthodox economic policy. By 1992 the financial sector had become modern and dynamic. But it was not until 1997 that banking law reform broadened the scope of permissible foreign activity for Chilean banks. Domestically, Chileans have recently begun to enjoy the benefits of new financial tools such as home equity loans, leasing, and debit cards. Increases in the use of traditional instruments, such as loans and credit cards, have also benefitted the Chilean population. Moreover, Chile has a private pension system with estimated assets of over US$30 billion at the end of 1997. Such assets have provided an important source of investment capital for the stock market. There has also been a significant increase in the number of firms with shares traded on the stock market as it continues to grow.

RETAIL.

Chile's retail sector is in a state of transition. Small neighborhood stores still hold a substantial market share, yet very large retail outlets such as hypermarkets are carving out an expanding share of sales. The number of large retail outlets has increased substantially in the past decade, and expansion is most apparent in the capital city. Well-designed shopping malls have proven successful in Santiago and other larger cities throughout Chile. Products most commonly displayed in Chile's malls include textiles and apparel, electronic appliances and devices, sporting goods, cosmetics, office supplies, and kitchen utensils.

Chile's retail sector constituted approximately 8.8 percent of the GDP during the 1990s. Sales in this sector rose 4-fold from the mid-1980s through the 1990s, to US$21.50 billion. The retail hotel and restaurant sector of the economy constitutes about 17 percent of the overall GDP. The retail sector is the second highest employer, comprising 18 percent of the workforce, or just under 1 million persons. About half of these workers are in the capital region of Santiago. The remainder are located in the more populated provinces, such as Vina del Mar and La Florida, where malls have been a growth industry since the 1990s.

INTERNATIONAL TRADE

Chile's economy is heavily reliant on international trade to sustain its economy. In 1997, exports reached US$17 billion and imports US$18.9 billion. Chile's main trading partners are the United States, Japan, Germany, and Brazil. However, Chile's export markets are geographically diverse, spanning Asia, the European Union, the United States, and Latin America. Latin America has been the fastest growing export market for Chile. Since 1991, Chile has signed free-trade agreements with Canada, Mexico, Venezuela, Colombia, and Ecuador. An associate agreement with MERCOSUR went into effect in October 1996.

Chilean exports have traditionally been dependant on copper and have been consumed mostly by industrialized countries. However, non-mineral exports have grown faster than those of copper and other minerals in recent years. In 1975, non-mineral exports were about 30 percent of total exports; by 1997 they accounted for 52 percent of export earnings. The most important of these non-mineral exports are forestry and wood products, fresh and processed fruit, fishmeal and seafood, and other manufactured products.

According to the latest statistics, Chile has 4 main markets of destination for its exports. First, Asia accounts for about one-third of total exports. Chile's principal Asian partner is Japan, although trade with the People's Republic of China, the Philippines, and Hong Kong is increasing. Trade with the European Union accounts for a quarter of overall trade, with the United Kingdom (5.8 percent) and Germany (4.8 percent) as the leading partners. With respect to Latin America, there has been a marked increase in exports to Brazil and Argentina. Their share in overall exports in 1997 was 6.1 percent and 4.6 percent respectively. The United States remained Chile's most important partner. In 1997 it accounted for 16.7 percent of Chile's total world exports.

Chile's imports originate mainly in the North American Free Trade Agreement (NAFTA) countries—the United States, Mexico, and Canada. Together, imports from these countries constituted 30.5 percent of all imports for 1997. In the same year, Latin America accounted for 26.5 percent, the European Union was at 19.8 percent, and Asia comprised 15.5 percent of imports. More specifically, by country, in 1997, Chile imported 23.1 percent from the United States, 9.2 percent from Argentina, and 6 percent from Brazil.

Chile is a party to bilateral trade agreements with Bolivia, Colombia, Canada, Cuba, Ecuador, Mexico, Peru, and Venezuela. Chile is also a member of the Asian Pacific Economic Cooperation (APEC). Currently, Chile is negotiating trade agreements with Central America (Costa Rica, El Salvador, Guatemala, Honduras, and Nicaragua) and plans to initiate negotiations with the European Union, New Zealand, Japan, and other countries. The current trade agreements have had a positive impact on international trade for Chile and are predicted to do so in the future. Past negotiations to obtain a free trade agreement between Chile and the North American Free Trade Association were unsuccessful. However, the current Summit of the Americas negotiations are intended to create a free trade zone from North America to Argentina.

MONEY

Historically, Chile has witnessed periods of inflation, stagnant growth, and recession when international events triggered a lowered demand for Chilean exports. Since Chile's economy has traditionally been heavily reliant on the export of natural resources, declines in demand have adverse effects on Chile because the amount of imports it needs to sustain its economy is not balanced against its exports.

Inflation in Chile has declined every year since 1990 when it stood at 27 percent. In 1996 inflation was 8.2 percent, and it fell to 6.1 percent in 1997. By 1999 inflation had dropped to 2.3 percent. Chile's overall economic

performance during 1990-97 was very strong. During this period, financial authorities at the Central Bank focused on further reducing the inflation rate , adjusting short-term interest rates to achieve this objective, and maintaining strong public sector finances.

The independent Central Bank of Chile was granted autonomy by constitutional law in 1990. Its primary goal was to raise interest rates, when necessary, in order to bring down inflation. Although Chile suffered a slight recession in the 1998-99 period, blamed in part on the East Asian economic crisis, consumer demand started to grow and the economy began recovering in early 2000. Inflation had been on a gradual downturn prior to the recession. The recession further reduced it to about 2.6 percent at the end of 1999. However, although inflation might be low, recession stunts domestic economic growth and has adverse effects on unemployment and GDP.

The Central Bank manages the foreign exchange rate through incremental changes to account for periods of extreme capital inflows. In September 1999, the Central Bank moved to a freely floating exchange rate system that is determined largely by market forces. It had initially held an exchange-rate band along which incremental changes were made in response to economic indicators. After the change in exchange rate systems the Chilean peso devalued by 5 percent within 6 weeks before stabilizing and slightly recovering. The value of the peso versus the U.S. dollar fell about 18 percent in 1999 (473 pesos to the dollar in December 1998 to 547 in December 1999). With the Central Bank intervening minimally to stabilize the economy, the exchange rate should return to normal standards by the year 2001.

POVERTY AND WEALTH

Currently more than 40 percent of the country's wealth is concentrated in the hands of just 10 percent of the population. In Latin America, only Brazil and Guatemala have less equitable income distribution. This huge disparity has created a large social divide in which a relatively small middle class is caught between a huge

mass of urban and rural poor and a small and extremely powerful elite. Fundamental to the shifts in economic policy over the years is the importance attached to income distribution by the changing administrations.

Wages have risen faster than inflation each year since 1990, a reflection of greater productivity in the country. Increased wages have produced public benefits of increased living standards and an expansion in the labor force. The number of Chileans with incomes below the poverty line (roughly US$4,000 per year for a family of 4) fell from 46 percent of the population in 1987 to 23 percent in 1997. Unemployment has varied with the business cycle in recent years, with annual rates between 4.5 to 6 percent.

The administration led by President Lagos has emphasized a commitment to better social conditions. They have addressed 4 priority areas: health, public safety, unemployment, and labor reforms. Finance Minister Nicolas Eyzaguirre has committed himself to fiscal discipline so that additional government resources can be used for social development. The secretary general to the presidency, Alvaro Garcia, has declared labor reforms and the creation of an unemployment benefit mechanism a priority. Analysts believe that even if unemployment rates are brought down through an expanding economy, Chile will still need to tackle fundamental problems of poverty and social disaffection if it is to avoid civil and labor unrest.

The Chilean constitution states that the government has an obligation to "promote, protect, restore health and rehabilitate the health status of individuals." Government administrations have made an effort to meet this goal. Chile currently spends about 7 percent of its GDP on health care. As of 1997 the public health system covered 67 percent of the Chilean population while private health insurance covered 27 percent. Public health care is somewhat inefficient, and the government is moving toward privatization of this sector.

THE RICH AND THE POOR.

A wealthy Chilean family has a nice house located in one of Santiago's more affluent neighborhoods. The family generally owns fancy cars and their children attend the private Catholic University. A nanny is usually hired to help the mother raise the children and clean the house. Nannies are typically lower-class Chileans or immigrants from Peru or Bolivia. The children of these families normally go on exchange programs to the United States or Europe and are able to speak English well. Wealthy families often travel internationally to places like New York and Florida and domestically to the Chilean beaches and the southern Lake District.

A poor Chilean family generally lives in a shanty neighborhood, and their children do not attend a university. The parents work long hours in either the informal sector or a place of business. Their children usually get jobs at a young age to help support the family. These families do not take extravagant vacations or buy expensive imported products. They live a very hard life.

WORKING CONDITIONS

In 1998 the Chilean workforce amounted to 5.8 million individuals. Unemployment has been rising in Chile, from 6.2 percent in 1993 to 7.5 percent in 1997. In 1998, Chile faced its first recession in 20 years. Unemployment increased in certain cities such as Valparaiso, where the local unemployment rate was 13 percent, and Santiago, where it was estimated at 14.4 percent. However, the

economy was expected to recover in the upcoming years leading to a decline in unemployment rates.

Chile is relatively developed in its labor laws compared to other Latin American countries. Workers are not required to request authorization to join or form a union. Approximately 12 percent of the workforce belongs to a union. Legislation passed in 1995 gave government employees many of the same rights as union members, with the exception that they may not legally strike. Reforms made to the labor code in 1990 helped to facilitate workers' right to strike.

Under the Pinochet dictatorship, labor unions were severely limited to the point of futility. Immediately after the coup that brought Pinochet to power in 1973, labor institutions were dismantled. The structural reforms the new regime wanted to implement had severe negative ramifications for the working class. In order for the government to continue with its economic changes, working conditions such as wages were once again regulated, and the ability to strike had to be allowed.

Forced labor is prohibited under the constitution and the labor code, and is not prevalent in the country. Child labor laws are codified, setting the minimum age to work at 14, with the permission of the child's parents or guardians. However, child labor is restricted to certain types of labor and is most prevalent in the informal economy, since this area is more difficult to regulate. The Chilean government estimates that approximately 50,000 children between the ages of 6 and 14 work. Such labor is concentrated in the countryside or with the children's parents.

According to the U.S. Department of State, minimum wages, hours of work, and occupational safety and health standards are regulated by law, with the legal work week set at 48 hours. The minimum wage is currently around US$190 per month and is set by the government, management, and unions. If representatives from these groups cannot come to an agreement, the government decides. Family subsidies are provided for workers in the lower income category. Overall, wages have risen steadily over the last several years. Moreover, poverty rates have declined in recent years from 46 percent of the population in 1987 to 21.7 percent in 1998. Currently, 11 percent of salaried workers earn the minimum wage.

COUNTRY HISTORY AND ECONOMIC DEVELOPMENT

1540. Spanish explorer Pedro de Valdivia conquers Indians in Chile and makes Chile a colony of Spain.

17TH CENTURY. Ranching becomes Chile's primary export trade, with large estates employing bonded peasants as European diseases reduce the native population.

18TH CENTURY. Around 20,000 Spaniards emigrate to the new Chilean colony.

1750. Chile is permitted by Spain to mint its own coins.

1791. Governor Ambrosio O'Higgins y Ballenary, a Spanish officer of Irish origin who became the governor of Chile, outlaws forced labor.

1810. Criollo (people of Spanish heritage born in Latin America during the times of conquest) leaders of Santiago declare independence from Spain.

1814. Spanish troops from Peru reconquer Chile at the Battle of Rancagua. Chile is once again a colony of Spain.

1817. Troops led by Bernardo O'Higgins Riquelme (the first Chilean head of state) and General Jose de San Martin (an officer of the Spanish Army and one of the principal leaders of the independence movement) defeat the Spanish in the Battle of Chacabuco. O'Hig-gins becomes supreme director of Chile and is eventually dubbed the "father of Chile."

1818. Chile wins formal independence from Spain after San Martin defeats the last large Spanish force in the Battle of Maipu. The first provisional constitution is approved in plebiscite.

1823. Slavery is abolished.

1839. The first bank notes of Chilean currency go into circulation.

1884. Bolivia loses access to the South Pacific Ocean upon losing a border war with Chile.

1927. Economic and political crises in Chile bring army officer Carlos Ibanez to power. He creates a powerful state system and establishes the national airline LAN Chile.

1970. The left wing coalition Popular United, led by Salvador Allende, wins the presidency, beginning Chile's first socialist government. Allende nationalizes the copper mines and begins to expropriate lands for government use and distribution. He enacts sweeping program reforms on the banking, commerce, insurance and industry sectors.

1973. Allende's government is overthrown in a military coup led by General Augusto Pinochet. President Allende is said to have denied an offer by the military to move him and his family out of the country. Allende then dies in circumstances that remain a matter of controversy.

1980. A new constitution is put in place by the military regime stipulating a referendum on a continued dictatorship in 1988.

1988. Fifty-four percent of voters reject Pinochet's regime in a national referendum. The country has grown tired of his harsh military rule resulting in thousands of murdered and tortured Chilean citizens.

1989. Patricio Aylwin from the Christian Democratic Party is elected president. The country returns to democracy and continues with the market-oriented reforms of the military regime.

1991. Chile begins an aggressive campaign to negotiate free trade agreements with other Latin American countries.

1994. Chile signs free trade agreements with various nations. The United States officially invites Chile to join the North American Free Trade Agreement during the closing ceremony of the Summit of the Americas in Miami.

1996. Chile becomes an associate member of MERCOSUR (a trade group which includes Argentina, Brazil, Paraguay, Uruguay).

1998. The Chilean economy begins to feel the effects of the East Asian crisis, and demand for Chilean exports declines. Pinochet retires as commander in chief of the armed forces and visits Britain. While he is in London, Spain requests the general's extradition for human rights abuses against Spanish citizens, and he is held under house arrest pending a legal decision.

1999. The Chilean economy begins to recover from a recession that began in 1998 as a result of the East Asian crisis. Pinochet is released by the British Home Secretary on grounds of ill health and returns to Chile where he remains under house arrest.

2000. The Chilean economy recovers well from the East Asian crisis and continues along a path of growth, increased globalization, and free trade.

FUTURE TRENDS

Although Chile's economy has been expanding over the past 15 years, it began to experience a slowdown in 1998 that lasted throughout most of 1999. Positive GDP growth in the beginning of 2000 marked the official end of the recession with growth projections being estimated at 6 percent. Since Chilean growth is heavily reliant on exports, concentrated mainly in primary products and processed natural resources, the country is extremely vulnerable to a decreased demand by other countries, which invariably lowers the prices of these commodities and slows the country's growth. However, continued foreign investment and government policies, designed to stimulate the economy, are expected to lead to a sustainable recovery.

In general, the international community is not concerned about the slight recession of the Chilean economy. Nevertheless, the Chilean government is watching the market carefully to ensure that the economy remains strong and continues to grow. As such, Chile is likely to continue with its free trade negotiations, having launched exploratory trade talks in early 2000 with the European Union. It has also expressed strong interest in becoming a full member of MERCOSUR. The political and economic situation in Chile looks promising and is likely to carry the country to increased growth and success for years to come.

DEPENDENCIES

Chile has no territories or colonies.

BIBLIOGRAPHY

Caistor, Nick. Chile: A Guide to the People, Politics, and Culture. Brooklyn, NY: Interlink Publishing, 1998.

"Chile and the IMF." International Monetary Fund. <http://www.imf.org/external/country/CHL/index.htm>. Accessed August 2001.

Economist Intelligence Unit. Country Profile: Chile. London: Economist Intelligence Unit, 2001.

Embassy of Chile. <http://www.embassyofchile.org>. AccessedAugust 2001.

Insight Guide: Chile. London: APA Publications, 2000.

Marcel, Mario, and Andres Solimano. "The Distribution of Income and Economic Adjustment." In Barry P. Bosworth et al, editors, The Chilean Economy: Policy Lessons and Challenges. Washington, D.C.: The Brookings Institution, 1994.

U.S. Central Intelligence Agency. World Factbook 2000. <http://www.odci.gov/cia/publications/factbook/index.html>. Accessed August 2001.

U.S. Department of State. "Background Notes: Chile." <http://www.state.gov/r/pa/bgn/index.cfm?docid=1981>. Accessed January 2001.

U.S. Department of State. FY 2001 Country Commercial Guide: Chile. <http://www.state.gov.www.about_state/business/com_guides/index.html>. Accessed January 2001.

U.S. Library of Congress. Chile: A Country Study. <http://lcweb2.loc.gov/frd/cs/cltoc.html>. Accessed December 2000.

—April J. Guillen

CAPITAL:

Santiago.

MONETARY UNIT:

Chilean peso (P). One Chilean peso equals 100 centavos. There are coins of 1, 5, 10, 50, 100, and 500 pesos and notes of 500, 1,000, 5,000 and 10,000 pesos.

CHIEF EXPORTS:

Copper, fish, fruits, paper and pulp, chemicals.

CHIEF IMPORTS:

Consumer goods, chemicals, motor vehicles, fuels, electrical machinery, heavy industrial machinery, food.

GROSS DOMESTIC PRODUCT:

US$185.1 billion (purchasing power parity, 1999 est.).

BALANCE OF TRADE:

Exports: US$15.6 billion (f.o.b., 1999 est.). Imports: US$13.9 billion (c.i.f., 1999 est.).

CHILE

Republic of Chile

Major Cities:
Santiago, Viña del Mar, Valparaíso, Concepción, Antofagasta

Other Cities:
Arica, Chillán, Chuquicamata, Iquique, La Serena, Puerto Montt, Punta Arenas, Talca, Talcahuano, Temuco, Valdivia

EDITOR'S NOTE

This chapter was adapted from the Department of State Post Report dated July 1996. Supplemental material has been added to increase coverage of minor cities, facts have been updated, and some material has been condensed. Readers are encouraged to visit the Department of State's web site at http://travel.state.gov/ for the most recent information available on travel to this country.

INTRODUCTION

CHILE can accurately be described as a land of variety and geographic delight. The northern deserts; the rich fields in the central valley; the labyrinths of channels, inlets, fjords, and peninsulas in the south; and the Andes in the east all provide stark contrasts that give Chile a unique beauty. Its cultural, political, financial, and commercial activities have been influenced by these geographical features. Its history is as varied as its topography, and it is almost as much a "melting pot" as the United States. Although many nationalities have settled here, the population is homogeneous and nationalistic.

Ferdinand Magellan was the first European to behold the coasts of Chile when, in 1520, he made the crossing from the Atlantic to the Pacific through the strait that now bears his name. An expedition led by Diego de Almagro moved southward from Peru in 1536, but the conquest was halted due to unfavorable weather and hostile Indians. Six years later, the city of Santiago was founded. Historical sources reveal that the name Chile was derived from either the name of a native chieftain, from a river in the area, or from the sound of an indigenous bird.

MAJOR CITIES

Santiago

Founded in 1541 by Pedro de Valdivia, greater Santiago today is a modern city of 5,261,000 inhabitants. It is the cultural, political, financial, and commercial center of Chile. Santiago impresses foreigners as being more European than most Latin American cities—a reflection of its population characteristics and Chile's historical isolation from its neighbors. The city's high level of sophistication is apparent in the educated, neatly dressed populace, the posh shopping malls, and the efficient transportation system.

The city lies at the eastern edge of the fertile central valley, and some of its residential areas reach into the Andean foothills. The Andean peaks, which are snow-covered much of the year, are visible from the city's center on a clear day. Situated roughly 70 miles from the Pacific ocean, Santiago is at an altitude of about 1,700 feet.

Chile's standard of living, which ranks high in Latin America, is highest in Santiago, where most of the country's wealth and 40% of its population are concentrated. There is a small but active American community. Chile's other large population centers—Valparaiso, Concepcion, Temuco, and Antofagasta—have distinct personalities but are more provincial. Valparaiso has a long history as a vital and colorful seaport.

Food

Americans are usually delighted with Santiago's modern supermarkets which offer most of the variety of major US grocery chains. The colorful array of high quality fresh fruits and vegetables is one of the many attractions of Chile. However, they must be cleaned and soaked in a special disinfectant before being eaten. Winter produce is more limited but selection is still good. Fish and seafood from the vast Chilean coastline include many interesting, little-known varieties which Americans have come to enjoy.

Milk products manufactured in Santiago are good quality. The pasteurized milk in supermarkets comes in three varieties: natural whole milk, reconstituted, and low in butterfat. Condensed, evaporated, long life, and powdered milk are also sold. A variety of local cheeses are available, in addition to many kinds of imported cheeses. Other local dairy products include yogurt, margarine, butter, sour cream, cream cheese, cottage cheese, ricotta, and ice cream.

Local brands of cereal, cake mixes, snack foods, canned and frozen fruits and vegetables, and acceptable baby formula and strained foods are available, as well as the complete range of staples, such as flour, sugar, oils, vinegar, etc. Most locally produced food items in Chile are currently less expensive than in the U.S.

Chile is famous for its fine selection of excellent wines, which are inexpensive. Beer and soft drinks (including diet varieties) are also good quality.

Clothing

Located in the temperate zone, Santiago has four seasons. Clothing needs for this climate are the same as for the Bay area south of San Francisco. Winter is long but generally mild. June through September rainfall may be heavy but almost never freezes. During these months some poorly heated homes become damp and chilly, requiring warmer indoor clothing. Lightweight thermal underwear is useful. Bring raincoats, umbrellas, and boots.

Spring and autumn are sunny and mild with some rain. However, almost no rain falls during Santiago's warm, sunny and dry summer (December through March). Houses usually remain cool and pleasant.

The temperature drops at sundown, and cool summer evenings require a light wrap.

Chileans dress stylishly and shop windows display fashionable, well-made clothes. However, large sizes are difficult to find, and extra-long men's clothing is unavailable. Hand knit wool and cotton sweaters are a good buy here, as are leather goods. Chile manufactures lovely leather shoes, but, compared with US-manufactured footwear, the choice of lasts is smaller and most ready made shoes come only one width for each size. Long and narrow widths are available in only 2 or 3 stores. Locally made clothing is of good quality and reasonably priced, imported brands are more expensive.

Quality and workmanship among Santiago's seamstresses and tailors vary. Good men's suits can be made from the woolens, cottons, and synthetics locally available; a wider variety of material is available for women's wear. Dry-cleaning service is good.

Men: Men wear business suits for office and social functions. A dark suit is appropriate for almost all evening occasions. For year-round wear medium-weight wool blend suits are most practical, though some men prefer a heavier fabric for winter and wash-and-wear suits for summer. A raincoat is necessary, preferably washable with zip lining. A top coat may be useful; hats are a matter of personal preference.

Chile's four seasons require a variety of sportswear. Flannel or wool shirts are comfortable for winter. Attractive wool and synthetic knit shirts and sweaters are available usually for less than one would pay in the U.S. Slacks, shorts, and swim trunks are also available but styles and colors may be limited, and cuts may not fit everybody. Cotton knit underwear and socks are available.

Women: Chilean women tend to dress more formally than American women—even in the grocery store. They wear the latest European fashions in clothes, both in style and fabrics. A basic wardrobe of multi-purpose clothing is more practical than many clothes of limited use.

Suits, wool dresses, knits, and two and three-piece combinations of wool and wool synthetic blends are popular for office, street or daytime functions from April through October. Some houses may be damp and chilly during this period, so warm clothing is needed. Skirts, blouses, and sweaters often are worn for office and informal meetings as well as at home. Slacks are acceptable at the office, jeans are worn on the weekends and for very casual occasions. (Here again, for Chileans, they are usually "designer" styles.) The widely varying temperatures during a 24-hour period often make the "layered look" the most practical.

In the summer (and occasionally in spring and autumn) women wear cotton, linen, and synthetic fabrics. Cool evenings usually require a light wrap. Stoles and blazers, as well as sweaters or sweater-coats, are useful.

Children: Generally children's clothes are attractive and inexpensive here Medium weight ski jackets are used a great deal. Boots are recommended. Sweaters that are easily washed, warm gloves, and light or medium-weight cotton thermal or knit long-sleeved pajamas are essential. Snowsuits are useful for winter trips to the ski resorts.

Satisfactory cotton knit and synthetic shorts and shirts are available for summer but may require special care compared with similar U.S. garments. This is also true of some of the highly styled children's clothes.

Most people buy their children's shoes locally. Leather shoes are generally well made and inexpensive. Sneakers such as Nike, Puma, and Diadora are sold in most stores and are expensive, but local brands are very reasonable.

School uniforms are required in Chile with the exception of nursery schools. However, the Nido de Aguilas School only requires uniforms through fifth grade. Some other schools where American students go do not require uniforms. No school uniforms should be purchased until you know in which school your children will be enrolled. Younger children sometimes wear coveralls or smocks over their uniforms—these may be purchased locally.

Boys' uniforms for those schools that require them usually consist of medium to dark gray trousers, white or light blue shirts, tie, and navy blue jackets with navy socks and black shoes. In winter boys may wear navy blue pea-jackets or ski jackets. Girls wear navy blue jumpers that must be purchased or made here in a specified style. Private schools for both girls and boys have different type of uniforms.

Teens in secondary grades at Nido de Aquiles wear the same clothing popular in a typical US high school, i.e., jeans, T-shirts, tennis shoes. Stylish teen apparel for boys and girls is sold in all the shopping areas.

Supplies and Services

Some well-known brands of American and international toiletries are available on the market but, if not made locally, may prove to be expensive. On the other hand, certain brands of face soaps and shampoos such as Camay and Silkience are manufactured here and are inexpensive.

Tailors and dressmakers charge less compared to the U.S. Laundry service, dry-cleaning, and shoe repair are good quality and also less expensive.

Service at beauty salons, which includes care of wigs, is good and comparable to U.S. The same is true of barber shops.

Simple car repairs and services are readily obtained for American (especially GMC) and foreign cars.

Auto rental rates locally are expensive, $60 and up per day.

Religious Activities

Chile is predominantly Roman Catholic, though Spanish-speaking Protestant congregations are also numerous. For the English-speaking community, the Santiago Community Church offers English language Protestant services, and the Holy Cross Order at St. George's School provides a Roman Catholic Mass in English during the Chilean school year. Other faiths represented in the city are Christian Science, Mormon, Baptist, Jewish, Greek Orthodox, and Seventh-Day Adventist.

The Santiago Community Church holds Sunday school for children. Through the International Preparatory School, Nido de Aguilas, and other schools, Roman Catholic religious instruction is available. There is a Jewish day school. The Estadio Israelita (community center) offers religious instruction (in Spanish on Friday afternoons for children who do not attend the day school.

Education

Chile's established public school system is supplemented by numerous private schools for students in nursery through high school. The school year extends from March to mid-December with a vacation of two weeks in July and one week in September. All schools in Chile (public and private) schools require uniforms (see Clothing.)

Most American children attend Nido de Aguilas International School, (Casilla 16.211, Santiago 9), a coeducational, non-sectarian, N-12 school for students from Chile, the US, and numerous other countries. At Nido instruction is in English, and the curriculum, textbooks, and methods are US-based. The school is accredited by the U.S. Southern Association of Colleges and Schools. The student-teacher ratio is 20 to 1. Currently there are 750 students at Nido. The Headmaster is an American, as are approximately one-third of the teachers.

The elementary grades offer an individually guided program based on language arts, social studies, math, science, music, and art. The secondary school prepares students to meet the admission requirements of both US and Latin American universities.

Electives and special tutorial courses help to accommodate the varied educational backgrounds and needs of all international students. The International Baccalaureate (IB) program for grades 11 and 12 offers advanced level instruction in English, Math, Science, and Social Studies which can provide advanced placement in college.

College and career counseling for Chilean, American, and other international students is a regular part of the program. The standardized testing program to measure achievement annually includes the Iowa Test of Basic Skills for grades 2,4,6, and 8; the preliminary Scholastic Aptitude Test (PSAT) for grades 10 and 11; and the College Board Scholastic Aptitude Test; and National Merit Scholarship Test. The high school is a member of the National Honor Society. Junior and senior high school students can participate in Nido's active sports program and numerous extracurricular activities. The music program includes three bands, an orchestra, and a chorus. Nido's school calendar begins in early August and runs through the following June with a long break mid-December through February.

Several other schools offer an opportunity to study in English. Some of the schools that American children presently attend are: Santiago College (Pk-12), a bilingual school with courses taught in English at the elementary level and primarily in Spanish in grades 9-12; the International Preparatory School (Pk-12), a small British school; and the Santiago Christian Academy (K-12), a small Baptist missionary school with an American curriculum that follows the U.S. school calendar, but is not accredited by the Chilean Ministry of Education or the US Southern Association of Colleges and Schools.

Special Educational Opportunities

Spanish language training courses for adults are available through private tutors. The Chilean-North American Institute provides special study opportunities and many cultural activities, such as lectures on Chilean history and culture and exhibits on Chilean art, as well as Spanish and English language training. The Institute's library features facilities in both English and Spanish.

Courses in painting, judo, ceramics, ballet, guitar, folk singing and dancing, and other cultural subjects are offered at various institutes around Santiago. There are good professional schools in classical dance and a respected music conservatory with excellent instruction. Fees vary but compare favorably with stateside prices. French language courses are available at the Alliance Francaise and the French Bi-national Institute; German is taught at the Goethe Institute.

Admission to Santiago universities can usually be arranged for those fluent in Spanish and with adequate academic credentials. However, US colleges and universities do not always recognize credits from local universities. Several institutes offer computer training.

Sports

Chile has such a wide variety of tourist and sports activities throughout the year, that avid sports enthusiasts are hard-pressed to find the time to take advantage of all the opportunities. Even confirmed couch potatoes find themselves getting involved.

Tennis is played year round in private clubs or on the excellent public courts which provide ball boys and instruction for very modest fees. Most courts are clay, and players should bring balls from the States as they are expensive here. Both private and public squash courts are also available. Racquetball is a relatively new addition to the sports scene, but there are a few courts.

Homes with swimming pools are common in Santiago, but serious swimmers might prefer to join a private club with a larger pool. Also Sauna Mundt Spa located uptown offers an excellent indoor swimming pool. The city also has several public swimming facilities.

Golf is a favorite pastime in Chile, and the courses are lovely. Although all the golf clubs in Santiago are private, there are some public greens in the resort areas along the coast. Private country clubs range in price from prohibitively expensive (Club de Golf Los Leones) to fairly reasonable (Club de Golf Lomas de La Dehesa). Some of the more exclusive clubs have long waiting lists or are no longer accepting new memberships. For non-golfers, a sports club such as Stade Francais, which offers tennis, squash, swimming, and a restaurant may be more appealing and much less expensive. Gyms with weight machines and supervised exercise programs welcome memberships for a fraction of US prices.

Many water sports are popular throughout Chile. The lakes in the central valley and the south attract boaters and water skiers. In some of the coastal cities, motor and sailboats are available for rent.

White water rafting trips for beginners and experts can be arranged on certain rivers. Scuba diving requires a wet suit due to the cold ocean water.

Chile offers superb trout fishing from October through mid-April in the south-central part of the country and some mountain lakes.

However, the nearest fresh water fishing spots are over four hours away by car, and ideal trout and salmon fishing streams are a day away by car, bus, or train or about 3 hours by plane from Santiago. Deep sea fishing (broadbill, swordfish, and marlin) and surf casting are also available but less popular. Heavy tackle (20-25 pounds) is recommended; bring it with you. Hunting is popular, but Chile has no large game. Rifles may only be used in the extreme southern part of Chile. Most hunters use 12-gauge shotguns with No. 8 shot. Partridge, quail, doves, ducks, and rabbits are hunted throughout Chile, but very little game is found within a few hours drive of Santiago.

Horseback riding is a year-round activity in Santiago, where several academies and riding clubs rent horses and provide instruction. Riding trips of a few hours up to a week can be arranged, and during the summer there are children's camps that specialize in horseback-riding. There is also a polo club.

The mountains visible from Santiago offer a challenge to the day hiker as well as the experienced mountaineer. At 8700 feet, Provincia can be scaled in a day, while the Cajon de Maipo, southeast of Santiago, is a mountain climber's paradise, with peaks reaching over 20,000 feet. There are hiking and climbing clubs in Santiago, catering to the needs of beginners and experts alike. Experienced guides are available for the most challenging climbs.

Skiing ranks as the outstanding winter sports attraction in Chile, where some of the finest skiing centers in the hemisphere are located. The skiing season extends from June to October (and occasionally through November). The most popular ski areas—Portillo, 3 hours away from Santiago, (site of international championship competitions located on the international highway to Mendoza, Argentina); and Farellones, Colorado, Valle Nevado, La Parva, one hour away from Santiago (weather permitting)—offer slopes for every skill level. Hotel rooms are expensive and reservations for July and August must be made several months in advance. The slopes are never as crowded as are many in the United States.

Spectator sports include soccer, horse-racing, and rodeos. Team sports for youngsters are offered at Nido de Aguilas (which has good facilities) and some other schools, as well as some of the private clubs. There is a local softball league which welcomes players and fans alike.

Shoes, clothing, and equipment for nearly every sport areas available in Santiago. Prices and quality vary. For instance, European imported skis are expensive, but are comparable to U.S. prices, while good fishing gear is very expensive. Golf equipment is very high while a top quality tennis racket may be slightly less than in the States.

Touring and Outdoor Activities:

Pleasant day trips are possible outside the city. In the winter one can decide between an active day on the ski slopes or a leisurely lunch by the sea as a Sunday excursion. Beautiful beaches are located within a 2-4 hour drive from Santiago. Some, however, are dangerous because of strong undertows and lack of lifeguards. The cold water makes swimming unattractive even in the summer. Hotel accommodations are adequate, but make reservations for the summer months well in advance.

Chile's largest summer resort, Viña del Mar, offers excellent hotels, a municipal gambling casino, nightclubs, golf and tennis facilities, a racetrack, and public beaches. Other fine beaches, located both south and north of Viña, often lack the accommodations and facilities of the more popular resorts, but are far less crowded. Most Chilean hotels are currently comparable to United States hotels cost wise.

Other attractive summer resorts are found in the lake region, about 500 miles south of Santiago. Known as the "Switzerland of South America," this area offers excellent trout fishing and some of the most magnificent scenery on the continent. Limited hotels require advance reservations during January and February.

The long list of summer touring activities includes: boat trips through the channels and fjords from Puerto Montt to Punta Arenas on the Straits of Magellan at the tip of the continent; the excursion to the Juan Fernandez Islands, 400 miles off the coast at Valparaíso; a visit to wilderness preserves such as the Torres del Paine Park near Punta Arenas; or a trip to Easter Island in the South Pacific.

In Chile's extreme north (1,300 miles from Santiago, two hours and 40 minutes by jet), Arica features year round spring weather, making it a popular spot in winter. It is also the base for excursions to the high Andean plateau and Lauca National Park, with vicuñas, flamingos and other Andean wildlife. All the major Northern seacoast cities—La Serena, Antofagasta, Iquique, and Arica—have a mild climate, sandy beaches, and sunshine most of the Year.

Opportunities for mountain climbing, hiking, and camping abound.

Camping facilities vary widely, but most provide baths and hot showers. Campsites are crowded during January and February, but usually are empty the rest of the summer. Camping equipment and supplies are readily available, but are usually less expensive if purchased in the U.S.

Note that tours to out of the way areas involving boats or air travel can be very expensive. In addition, the Pan-American Highway is mostly two lane and heavily traveled, making trips by car long and arduous.

Santiago is rather isolated from its neighbors. Lima is three and a quarter hours away by jet; however, Peru's prime attractions, the Incan cities of Cuzco and Machu Picchu, Buenos Aires (700 miles from Santiago), Montevideo, and Brazil are other favorite tourist destinations. Mendoza, Argentina is only 40 minutes away by jet or four to five hours by car; however, in winter the pass is often closed by snow.

Entertainment

In Santiago, the lovely Teatro Municipal is the center of an opera season, two ballet seasons, and two symphony orchestras that offer weekly concerts during the winter. Chamber music and choral groups perform frequently. Inexpensive businessmen's concerts are held weekly during the season at lunch time with sandwiches and beverages available in the theater lobby. Relatively economical season tickets are available.

Theater plays an active role in Santiago's cultural life. Several theaters present a variety of dramatic and satirical plays in Spanish throughout the year. The English-language amateur theater group, Santiago Stage, produces shows and is always delighted to have newcomers join.

The numerous movie theaters in the city and suburbs are good and inexpensive. All films are subject to censorship, with enforced minimum age limits set for each. Foreign films, which include many American films, are shown in their original language with Spanish subtitles.

Santiago has a few good nightclubs and discotheques. In general, Chileans prefer entertaining in their own homes, although young, unmarried adults frequently patronize clubs. Teenagers are generally pleased with the nightlife here. Several discos cater to their age group, and young people usually go with a group of friends. Unfortunately (for parents, at least) Chileans keep much later hours, and discos and private parties often begin between ll:00 pm and midnight, making typical US curfews difficult to enforce.

Plenty of average-to-very-good restaurants are available in Santiago. Service starts at about 2000 hours and is usually very good. Excellent inexpensive Chilean wines provide an elegant accompaniment to any meal.

Social Activities

Membership in the American Association of Chile is open to all Americans in Chile. Monthly meetings, usually a lunch or tea, provide a good opportunity to meet other Americans from the private sector. The Association sponsors a variety of activities, such as tennis, golf, bowling, bridge, library, quilting, and sewing groups, and several charitable activities.

The Rotary and the Lions Club have several local chapters. The US Chamber of Commerce has an affiliate in Santiago. Both the YWCA and the YMCA offer facilities for sports and cultural programs in the downtown area.

Special Information

Central Chile is one of the most seismically active places on earth, and destructive earthquakes have struck the country periodically throughout its history.

Residents of Santiago will frequently feel tremors which seldom result in damage.

Viña del Mar

Viña del Mar, a popular tourist spot near the Pacific Ocean, is Chile's second largest city. Located six miles east of Valparaíso, Viña del Mar has a population of close to 302,800. It is the country's largest summer resort, and also manufactures textiles, paint, glass, soaps, chemicals, and beverages. The area has first-class hotels, a municipal gambling casino and nightclub, golf and tennis facilities, a racetrack, beautiful parks and gardens, and public beaches. Other fine beaches may be found both south and north of Viña. These often lack the accommodations and facilities of the more popular resorts, but they are far less crowded.

Education

Mackay School, in Viña del Mar, is a boys' day school for kindergarten through grade 12. Founded in 1857 and governed by an elected board of governors, its admission requirements include tests and an interview.

The curriculum is Chilean-based, with English, French, and Spanish offered as foreign languages. Other elective classes are art, band, computer science, physical education, and vocational courses. Extracurricular activities include computer, drama, gymnastics/dance, guitar, literary magazine, newspaper, and rugby, soccer, and swimming. There are also special programs for children with learning disabilities.

The school year runs from March through December, with vacations in July and September. Enrollment is currently 651; there are 15 full-time and 50 part-time teachers. The staff also includes a math specialist, a counselor, and a nurse.

Mackay School is located in a coastal village about seven miles north of Viña del Mar. Facilities include language, computer, and science labs; a video studio; audiovisual room; library; cafeteria; and sports fields. The mailing address is Casilla 558, Viña del Mar, Chile.

Valparaíso

Valparaíso is the third largest city in Chile and the country's chief port. It is located 60 miles northeast of Santiago on the Pacific Ocean. Founded in 1536 by the Spanish conqueror Juan de Saavedra, the city was not permanently established until Pedro de Valdivia's arrival eight years later. The early history of Valparaíso was scattered with raids by English and Dutch pirates; it was bombarded by the Spanish fleet in 1866. Unimportant during colonial times, Valparaíso grew after the last severe earthquakes in 1907 and 1971.

Valparaíso is situated on a narrow waterfront terrace. Steep hills rise to give the city the effect of an amphitheater, with the wharves and business section below and the residential areas above. A cable railway is used to ascend some of the steeper areas. The city faces a wide bay and is partially protected by the breakwaters. The climate is generally mild, although severe winds do occur during the winter months.

As the principal port in Chile, Valparaíso has extensive modern dock facilities and handles the bulk of the country's imports. It manufactures chemicals, textiles, paint, leather goods, clothing, metal products, vegetable oils, and sugar.

Thousands of tourists annually visit Valparaíso, whose resident population is about 276,800. Visitors are attracted to the city's parks, theaters, cafes, colonial buildings, and museums.

Concepción

Concepción, 275 miles southwest of Santiago near the mouth of the Bío-Bío River, is one of Chile's commercial and industrial centers. It was founded in 1550 by Pedro de Valdivia about six miles from its present site. Throughout its history, Concepción has been completely destroyed by earthquakes five times. It was further damaged in 1960 by an earthquake, and it is the numerous restorations that have given the city its modern look.

Concepción produces glass, steel, textiles, sugar, and hides. Woodworking, food processing, glass-making, and brewing are also important industries. Its port, Talcahuano, located just north of Concepción on the Pacific Ocean, ships products produced in the rich agricultural region to the east. Concepción has an estimated population of about 33,000 (2000).

Education

St. John's School, in Concepción, is a coeducational, proprietary school for pre-kindergarten through grade 12. Founded in 1942 and governed by an elected board, admission requirements include an application, past school records, tests, and an interview.

The curriculum is Chilean-based. French is offered as a foreign language, along with the following elective classes: art, chorus, computer science, and physical education. Extracurricular activities include ceramics, chess club, computers, drama, yearbook, literary magazine, gymnastics/dance, guitar, and basketball, football, volleyball, hockey, and rugby.

The school year runs from the middle of March through December, with vacations in July and September. Enrollment in 1991-92 was 1,026; enrollment capacity is 1,260. There were 52 full-time and 20 part-time teachers. The staff also includes a counselor and a nurse.

St. John's School is located in a residential area of Concepción. Facilities include 45 classrooms, cafeteria, infirmary, a gymnasium, playing fields, and a 9,000-volume library; there are also science labs, computer labs, and a stadium nearby. The mailing address is Casilla 284, Concepción, Chile.

Antofagasta

Antofagasta, located 700 miles northwest of Santiago, is a port on the Pacific Ocean. It was founded in 1870 in Bolivian territory by Chileans wanting to exploit nitrates in the Desert of Atacama. This action, along with the city's occupation by Chilean troops, resulted in the War of the Pacific in 1879 with Bolivia. As a result of the Treaty of Valparaíso following the war, the area was ceded to Chile in 1884.

The economy of Antofagasta depends greatly on nitrates and copper exports, and the city is affected by fluctuations of these products in world markets. The city's industries include large foundries and oil refineries, food and beverage processing, and fish-meal production; it is also an international commercial center.

Antofagasta is surrounded by desert hills and has a pleasant, dry climate. Rainfall is scarce and necessitates the piping in of water from the San Pedro River, 280 miles away. The population was approximately 226,800 in 2000.

OTHER CITIES

ARICA , with a population that exceeds 180,000, is located in northern Chile, just south of the Peruvian border. Arica is situated on the Pacific Ocean at the northern limit of the Desert of Atacama. The city was originally part of Peru, but was occupied by Chile in 1880. Following the War of the Pacific, Arica was ceded to Chile, along with Tacna, through the Treaty of Ancon in 1883. After the Tacna-Arica Controversy was resolved in 1929, Chile retained jurisdiction over the city, but agreed to provide complete port facilities to Peru. Arica is currently a free zone, with both Chile and Peru maintaining customs facilities here. Access to the sea through Arica was also granted to Bolivia in 1920 via the Arica-La Paz Railroad. Today, Arica is a resort, and its port ships mineral exports—mostly copper, tin, and sulfur—for both Chile and Peru. Two major industries, automobile assembly and fish-meal processing, are located in Arica. The city is a major transportation center. It has an international airport, seaport, and railway links with neighboring Bolivia and Peru. With year-round spring weather, the city is popular during the winter months.

CHILLÁN , located in central Chile, is the birthplace of one of the nation's fathers of independence, Bernardo O'Higgins. Chillán has had two severe earthquakes (1833 and 1939) since its founding in 1580. The city uses the raw materials (fruits, grains) from its rich farmland to produce wine and flour. Industries located in Chillán include shoe factories, flour mills, and lumberyards. Skiing is popular in the foothills of the nearby Andes. The resident population is approximately 163,000.

CHUQUICAMATA , about 125 miles northeast of Antofagasta, at an elevation of 10,435 feet, is located on the western slopes of the Andes. Chuquicamata is a mining town and has the world's largest copper-mining center. The open-pit copper mine, which dates to 1915, produces almost all of Chile's copper. Copper from this mine is transported south to Antofagasta for export. The population today is over 30,000.

IQUIQUE , a port on the Pacific, is located in northern Chile between Arica and Antofagasta, just 130 miles south of the Peruvian border. The city was founded in the 16th century and became part of Chile during the War of the Pacific in 1879. Rock and sand surround Iquique on the east; the city has fine beaches, a mild climate, and year-round sunshine. Water must be piped to Iquique from 60 miles away, as the area receives little rainfall. As a port, Iquique exports iodine and nitrates from the Atacama Desert. The city is an excellent place for deep-sea fishing. Tourism, based on sport fishing and beach facilities, also contributes to the economy. Fruits, sugarcane, and olives are grown near the city and exported through Iquique's port. The current population is about 160,000.

LA SERENA , 250 miles northwest of Santiago, is a popular beach resort noted for its cathedral and its gardens. With a population of close to 124,000, La Serena is situated on the Elqui River in a commercial and agricultural region known for vineyards and orchards. The city was founded in 1543 and was the site of Chile's Declaration of Independence on February 12, 1818. La Serena has been damaged many times by earthquakes, but still retains its old world charm. La Serena is a popular tourist resort. The city has a mild climate and sunshine most of the year.

PUERTO MONTT is a port on the Gulf of Ancud, an inlet of the Pacific Ocean. With a population of just over 130,000, Puerto Montt is located 600 miles south of Santiago. Named for former Chilean president Manuel Montt, Puerto Montt was founded in 1853, and is an important area for fishing and sheep farming. The city's industries include fish canning, tanning, and sawmilling. Agricultural products, including potatoes and various grains, are grown near the city. The city is the southern terminus for the country's railroads and the starting point for navigation in the inland waterways and islands to the south. Puerto Montt is a popular resort with beautiful scenery—lakes, narrow fjords, forested hills, and peaks. During the summer, boat trips may be taken from Puerto Montt to Punta Arenas. There is an American School here; it is described in the Education section under Santiago.

PUNTA ARENAS , with a population of 120,000, is located in Tierra del Fuego. Sometimes called Magallanes, it is one of the world's two largest southernmost cities (Ushuaia, Argentina is further south), and the only one situated on the Strait of Magellan. Punta Arenas was founded in 1849 in order to secure Chile's claim to the strait, and was a busy coaling station until the Panama Canal was constructed. Today Punta Arenas is an important center for exporting Patagonian wool and mutton; naval and military facilities are also present in the area. Lumber and petroleum are exported through the city's port. Despite a long rainy season, Punta Arenas is a popular tourist resort and has one of South America's finest museums.

TALCA is about 150 miles south of Santiago near the Pacific Ocean. It is located in Chile's wine-producing region. Talca's industries include paper and flour mills, shoe factories, foundries, tanneries, and distilleries. The city was devastated by two earthquakes, in 1742 and 1928. Rebuilt in 1928, Talca now has a modern atmosphere with pleasant parks and avenues. The city is accessible by railroads and the Pan-American Highway. The population is estimated at 175,000.

TALCAHUANO is located on a small peninsula extending into the Pacific Ocean. It is in the State of Bío-Bío, approximately 50 miles north of Concepción. Talcahuano is an important manufacturing, and commercial center. Several industries are located here, among them flour milling, fish canning, and petroleum refining. Many products, such as hides, wool, fur, coal, and lumber are exported from Talcahuano's port. A large steel plant is located in nearby Huachipato. A Peruvian warship captured by Chile during the war of the Pacific is on display in Talcahuano's harbor. The city has a natural harbor that is considered the best in Chile. A leading commercial port, Talcahuano is also home of the country's naval base. The city suffered two earthquakes (1730 and 1960s). Its population today is about 270,000.

TEMUCO is 400 miles south of Santiago, on the Cautin River in central Chile. After its founding in 1881, other points to the south of Temuco began to be settled. The region was occupied by the Araucanian Indians, who are still an important part of life here. Temuco is a commercial city trading in livestock and agriculture produced in the region; grains, fruit, and timber are among the products traded and processed. Of interest in the city is an Araucanian museum. Temuco has a military air base, a cathedral, and several missionary schools. The city is accessible via railroads and the Pan-American Highway. The population was over 253,000 in 1997.

VALDIVIA is located in southern Chile, about 250 miles from Santiago. The city was founded as a fortress against the Araucanian Indians in 1552. When German immigrants arrived in the mid-19th century, the city began to grow with the introduction of its first two industries—beer and shoes. Other industries include lumber, metal goods, boats, and foodstuffs. Valdivia was mostly destroyed by an earthquake in 1960, but has been extensively reconstructed. Today, it has a population of about 122,000, and is a tourist center in the lake region.

COUNTRY PROFILE

Geography and Climate

Chile is a narrow ribbon of land stretching almost 2,700 miles along the west coast of South America. Although it is one of the world's longest countries, its average width measures only 100 miles, and its maximum width, only 250 miles.

Santiago, Chile's capital and largest city, is almost directly south of Hartford, Connecticut. Valparaiso, the country's chief port, is farther east than New York City.

Wedged between the Andes on the east and the Pacific on the west, Chile is bordered by Peru to the north and Bolivia and Argentina to the east. Larger than any European country, except Russia, Chile covers an area of 292,257 square miles, about the size of California, Oregon, and half of Washington state combined. In the extreme south where the Atlantic and Pacific merge, the land becomes an archipelago with Cape Horn at its tip. Since Chile is south of the equator, the seasons are the reverse of those in the Northern Hemisphere. Santiago is about as far from the equator as are Atlanta and Los Angeles.

The Cordillera of the Andes which extends the length of the land is Chile's dominant feature. Over 100 volcanoes dot the mountain system, and its relatively recent creation accounts for the country's often damaging earthquakes. This majestic chain has several peaks over 20,000 feet, including Mount Aconcagua (23,000 feet), the highest in the western hemisphere.

Chile has distinct geographic regions which can be roughly divided into four areas: the arid North; the fertile central valley midlands; the forested land and lakes in South-Central Chile; and the archipelagos, fjords, and channels of the far south.

The great northern desert or "Norte Grande" which constitutes one fourth of the country is one of the driest most barren areas on earth. Ironically this desolate, inhospitable land also produces rich mineral deposits such as copper and nitrates which are vital to the country's economy. Separating the northern desert from the central valley is a semiarid stretch of land known as the "Norte Chico" (Little North).

The central valley, where most of the population lives, begins with the Aconcagua River basin north of Santiago and continues on to the Bío-Bío River at Concepción. The nation's major industrial and agricultural production is located in this section.

South-Central Chile below the Bío-Bío River is punctuated with an exquisite string of lakes running on a line from north to south and parallel to the Argentine border all the way from Temuco to Puerto Montt. This is the famous lake district, renowned for its beauty.

The archipelago south of Puerto Montt is usually rainy, with forested fjords and many glaciers and sea channels resembling southernmost Alaska. Still further to the south are the windy steppes and sheep country of Patagonia and Tierra del Fuego.

A number of Pacific islands are a part of Chilean territory. The Juan Fernandez Islands are 400 miles southwest of Valparaíso. The abandoned sailor, Alexander Selkirk, lived on one of these islands for 5 years; his adventures inspired Daniel Defoe's Robinson Crusoe. About 2,000 miles west of the continent is the famous Easter Island, or Rapa-Nui (Chilean since 1888), which is inhabited by Polynesians and is distinguished by gigantic stone monuments and carvings unique to the island. Chile also claims a wedge-shaped portion of Antarctica.

Chile's climate is as varied as its geography. In the far north, summers are warm and winters along the coast quite mild. Despite the fact that much of the north lies within the tropics, the cold Humboldt Current off the coast and the relatively short distance between the coast and the snow-covered Andean peaks to the east modify what might otherwise be a tropical climate. Precipitation is scant. In Santiago long, dry summers (December-March) feature warm days and cool evenings with temperatures reaching the low nineties. The June-September winter season is cold and rainy (14 inches of rain per year), with dampness and fog making the cold more penetrating, even though the temperature rarely drops to freezing. The weather in the capital is almost identical to that of Palo Alto and the southern bay region of California. The lake region is colder and wetter with annual rainfall reaching 100 inches. In the far south, the climate is colder still with gale force winds most of the year. Rainfall continues at the rate of 100 inches annually except in Patagonia where it drops to 20 inches a year.

Population

Chile's population is about 15.2 million (2000). Chile is mainly urban (83%), with almost 40% of its people living in the capital and environs. As in other developing countries, the population is youthful. About 30% of the population is under 15 years of age.

Chile is one of the more sparsely populated countries of Latin America (about 50 inhabitants per square mile). Its annual population growth rate is 1.5%. The family is usually a cohesive unit at all levels of society. A large middle class, with a nucleus of professional people, is important in business and government. But Chile also has a large poor class living in "poblaciones" (makeshift communities scattered in suburban areas of the larger cities). The rural population, including the indigenous Araucanian Indians, has a standard of living generally well below that of the urban population.

The largest ethnic group is Spanish. Other principal groups include German, English, Italian, Yugoslav, and Arab. The population includes a small number of native Indians but almost no Asians or Blacks. The Indians live mainly south of the Bío-Bío River and in the Andean North. The most important group, the Araucanian Indians, has never been fully assimilated into Chilean society.

During the colonial period, European immigration originated almost entirely from Spain; early colonists were mainly Basques and Castilians. A small but influential number of Irish and English immigrants also came to Chile and played important roles in Chilean history. Bernardo O ' Higgins, Chile's national hero, was of Irish descent.

After Chile won independence in 1810, many Irish, Scottish, and English immigrated to the new republic. In 1845 an official Chilean colonizing agency was set up in Europe to stimulate immigration, particularly from Germany. A small group of German colonists which arrived in 1850 was the first of a large-scale immigration that continued for 90 years. Most Germans settled in the Valdivia-Llanquihue-Chiloe area in the south, where towns have a decidedly Bavarian ambience. Spanish immigrants continued to arrive in large numbers throughout the 19th century and were joined by Italians, French, Swiss, British, Yugoslavs, and others. The twentieth century brought an influx of Middle-Easterners (principally Palestinians and Lebanese) as well as Europeans. Several thousand displaced persons resettled here after World War II.

Despite the diversity of their origins, few South American populations are more homogeneous than the Chileans. Their homogeneity and insularity are in large part the result of isolating geographic factors: mountains, deserts, a vast ocean, and long distances from outside cultural and political centers.

The Catholic religion predominates and is influential at all levels of society. However, religious freedom and separation of church and state are guaranteed by the Constitution. About 10% of the population is Protestant, and there is a small Jewish community.

Most Chilean holidays commemorate events important in the country's history or celebrate traditional feast days or holy days of the Catholic Church. The Fiestas Patrias, a 2-day celebration commemorating Chilean independence in mid-September, is the main patriotic holiday. The greatest religious festivals occur during Christmas and Holy Week. Some areas celebrate other religious holidays with centuries-old processions and dances.

Typical Chilean cuisine is simple, hearty, and rather blandly spiced. Beef, chicken, and seafood are the most popular main dishes. Cazuela, a stew of chicken, beef, pork, or fish, and the empanada (a pastry turnover filled with meat, fish, spiced onions, cheese, or even edible seaweed and served hot) are specialties.

Wine accompanies most meals. Other typical Chilean drinks include borgoña, red wine mixed with sparkling water and fruit; cola de mono, a Christmas drink similar to eggnog; chicha, grape or apple cider; and pisco sour, an indigenous liquor distilled from grapes, mixed with sugar syrup and lemon juice.

Public Institutions

Chile is a unitary republic with a highly centralized administrative structure and a strong executive. The President who serves a six-year term and cannot seek immediate reelection, appoints cabinet ministers and rector of state universities, as well as 13 regional administrators (intendentes), 51 provincial governors and numerous other officials. In December 1993, Eduardo Frei, the candidate for a coalition of center and moderate leftist political parties, was elected President with 58% of the vote. Frei, the son of a former president, took office in March 1994.

The bicameral Congress is made up of a Senate and a Chamber of Deputies. the Senate has 38 elected seats—two from each of 19 senatorial districts (circumscripciones)—and nine designated seats, which are variously filled by appointees of the Supreme Court, The National Security Council and the President. In addition, ex-presidents who have served six consecutive years also have the option of serving in the Senate for life. Senators are elected or appointed to eight-year terms. Half of the elected seats come up for reelection every four years.

The 120 members of the Chamber of Deputies are all elected, two from each of 60 electoral districts, and serve four year terms. Permanent commissions, roughly equivalent to committees in the U.S. Congress, work out the details of proposed legislation. Since reopening with the return to democracy in 1990, the Congress has been located in the port city of Valparaiso, 115 kilometers (about ½ hours by car northwest of Santiago.

Chile operates under a constitution promulgated during the military government of General Augusto Pinochet (1973-1990). That constitution provides for a democratic system, including an independent judiciary, while containing some limitations on popular sovereignty. It also grants considerable institutional autonomy to the armed services and national police.

Arts, Science, and Education

Santiago has traditionally been one of Latin America's most active centers of the fine and performing arts. Cultural events are generally held from March to November.

The Philharmonic Orchestra of Santiago and the Chilean National Symphony have subscription series, as do the Municipal Ballet and Opera. The National Ballet of the University of Chile also performs during the cultural season. The hub of ballet and opera activity is Santiago's superb Municipal Theater, which is a magnet for top foreign artists. The Beethoven Society of Santiago, the leading private cultural institution, offers a yearly subscription series featuring internationally recognized musicians during its May to September season.

Frequent concerts and recitals by local artists are held throughout the year. In January there is an international jazz festival in Santiago and in February there are two music festivals which attract international artists as well as local talent. One, held in Viña del Mar, features popular and rock and roll music; while the other, held in Frutillar on Lake Llanquihue, is devoted to classical music and provides a forum for Chile's young musicians. In addition, Santiago has a number of cultural FM radio stations.

Several professional theater companies in Santiago present exceptionally high quality productions by both Chilean and foreign playwrights. "Santiago Stage," the Anglo-American community's amateur theater group, produces plays in English each year. Many American and British films reach Santiago's cinemas only a few months after their release in the United States, and European and Latin American films are also frequently shown. Cinema films are usually shown in the original language with Spanish subtitles, though nearly all non-Spanish television films and other programs are dubbed in Spanish. Local "art" movie houses present re-runs of notable film classics.

Santiago has several good museums featuring pre-Columbian, folk, colonial, religious, and contemporary art; science; and Chilean history. Works by modern artists, sculptors, and photographers are exhibited and sold in the many private galleries. The National Library of Chile is one of the largest in Latin America. In addition, the Chilean-American Cultural Institute (BNC) has one of the most modern libraries in the capital.

Chile's folklore is rich. Examples of traditional music and dance are offered nearly every night of the year in several Santiago nightclubs and at festivals and special occasions outside the capital. Other night spots feature urban "folk" music, jazz, and tango. Santiago has several discotheques.

Chilean writers have won international fame for their achievements. Among the country's twentieth-century poets are the Nobel Prize winners Gabriela Mistral and Pablo Neruda, as well as Vicente Huidobro and Nicanor Parra. José Donoso, Maria Luisa Bombal, Isabel Allende, Manuel Rojas, and Jorge Edwards head the list of leading novelists. The country has also produced a number of fine short-story writers, essayists, historians, and playwrights.

Science

The Chilean government, universities, and other public and private entities actively encourage scientific activity.

Most universities have departments of science and technology and several of the country's finest centers of higher learning specialize in these fields. The Chilean Scientific Society publishes a scholarly journal.

Although Chile, unlike Peru to the north, was never the seat of a great Indian culture, archeological research centered in the northern desert has uncovered considerable evidence of pre-Columbian settlements showing southward extension of Incan and pre-Incan Andean civilizations.

Its location and clear desert air have made northern Chile the center of Southern Hemisphere astronomical research. Two of the world's largest observatories are located near La Serena, a day's drive north of Santiago; one is run by a consortium of U.S. universities.

Education

Chile has been a leader in public education in Latin America since the mid-nineteenth century. Of the country's universities, the oldest and most prestigious are the University of Chile, founded in 1842, and Catholic University, founded in l888. The University of Santiago, dedicated mainly to science and technology is also important.

Valparaiso has three good-sized universities and Concepcion two. Most other provincial capitals have universities which serve their respective regions. Many private universities have been created over the past 15 years being the most prestigious Diego Portales University, Gabriela Mistral, Universidad Central, Andres Bello, etc.

Commerce And Industry

Chile's current government adheres to largely free market economic policies, including low and uniform tariffs (except on automobiles and a few other items regarded as luxury consumption) and an openness to foreign investment. As a result of these policies Chile has enjoyed several years of real economic growth, relatively low inflation, balance of payments equilibrium and, more recently, near full employment. In particular, the innovative use of debt-for-equity swaps has allowed Chile to make deep cuts in its debt to foreign bankers.

To lesson the country's dependence on mining activity, especially copper, the government has promoted development in areas such as forestry, fruits, and fishing in which Chile has a comparative advantage. As a result copper now accounts for less than 50% of Chile's export earnings compared to over 80% in the early 70s.

There are no quotas or embargoes on imports, and foreign goods are abundant, though generally somewhat higher priced than in the US. The US remains Chile's main trading partner with some 23% of the import market. Other important trading partners are Japan, Brazil, Argentina, Venezuela and Germany. Chile is ranked 34th among the U.S. trading partners.

Transportation

Automobiles

The axis of the generally adequate road network is a hard-surfaced highway running from Arica (in the North) to Puerto Montt which expands to four lanes near Santiago. Many other roads, however, are narrow and unpaved. Good paved roads link Santiago with Valparaíso and other cities on the central coast and connect central Chile with the Argentine border en route to Mendoza, Argentina, and the Argentine highway system. The road to the Argentine border is frequently closed by snow in winter.

Bus

Santiago offers a very comprehensive bus system. Although there are many new buses, the majority are run down, and they are all crowded during rush hour. However, the price is right—about a quarter. The subway system is always a pleasant surprise to newcomers. Clean and efficient, it costs even less than a bus.

The streets are teeming with taxis which are easily recognizable By their color—black with a yellow roof. The service is good and prices are reasonable. All taxis now have meters except tourist taxis at larger hotels, which charge a flat rate for certain trips. Taxis levy a legal surcharge on Sundays and daily after 9 p.m. which increases again after midnight. This surcharge is not shown on older meters, but newer meters indicate holiday and night rates. In addition there are "colectivos" or shared cabs that follow fixed routes. All black, with signs on the roof announcing their routes, "colectivos" can be flagged down like cabs.

Public transportation can meet most needs, but as in the US, at the price of some inconvenience and waiting.

Railway

Chile has a fairly extensive but old railway system, although at this time no rail passenger service operates north of Santiago. Sleeping cars and roll-on, roll-off cars for automobiles provide overnight rail service between Santiago and Puerto Montt. Most intercity buses are new and comfortable and follow fixed schedules. Some long-distance buses feature sleeping berths.

Air

Air service is well-developed and important to Chile's economy. Several domestic lines serve principal Chilean cities. Various carriers provide frequent flights between Chile and the US, including two American airlines. American and foreign passenger ships and freighters call at Valparaiso.

Communications

Telephone and Telegraph

Telephone service is very good. Privatization of long distance telephone service and local carrier completion has resulted in improved telephone service in all aspects. Calls can be made via the carrier of your choice (at last count there were six carriers operating in the Santiago area). International dialing rates are relatively inexpensive at this time, though the prices have been dynamic since the multi-carrier law went into effect in October of 1994. Local phone cards are available for placing long distance calls from any public phone in Chile or the United States. U.S. calling cards can also be used, though the rates tend to be slightly higher.

Radio And TV

Radio is Chile's most influential mass communications medium. There are a total of 300 AM and FM radio stations in Chile, with about 50 broadcasting from Santiago. Broadcasting is almost exclusively in the Spanish language, although a few English language programs can occasionally be heard. Several Santiago stations broadcast a broad range of American music in FM stereo. English language news can be heard on shortwave via the Voice of America (VOA) and the British Broadcasting Company (BBC).

Santiago has six VHF TV channels, all of which broadcast in color, using the U.S. NTSC system. Programming includes a number of older U.S. television series and movie productions, local and imported soap operas, and a variety of news and local entertainment shows. There are no UHF stations. Some areas have access to one or two cable TV systems which carry the international versions of CNN, ESPN, TNT, HBO, AND MTV. There are also a number of stations from Europe and other Latin American countries as well as C-SPAN and Worldnet at certain times.

Newspapers, Magazines, And Books

English language books and magazines are scarce in Chile. Books in English can be obtained from a few local bookstores but they are expensive. The Chilean-American Cultural Institute (BNC) has 10,000 English language books and 115 U.S. periodicals. The American Association of Chile sponsors book groups which buy English language books for members' use, and the Santiago Lending Library is a volunteer organization which has a small but quality collection of fiction and nonfiction. (Both the latter charge a minimal monthly fee.) Students of Nido de Aguilas and their parents have access to the school library and some of the churches with English language services also have collections of books in English.

There is an English language weekly paper The News Review, also the international editions of Time and Newsweek are sold locally. American newspapers are available two to four days late through several newsstands. A subscription to the Miami Herald can be arranged with same day delivery, but it is expensive. The American Association of Chile publishes a monthly pamphlet, The Spotlight, which is full of information and practical advice for foreigners living in Chile. Likewise, The Journal of the American Chamber of Commerce is geared to the needs and interests of the business community.

Chilean information media operate entirely in Spanish. El Mercurio, a conservative, Santiago morning publication, is Chile's most prestigious and influential paper. Several weekly news magazines representing various political points of view have a nationwide readership. In addition, there are magazines featuring women's fashions, science, economic-financial matters, and sports.

Health And Medicine

Medical Facilities

While in the US, individuals should obtain a yellow fever shot, which can be given only at approved vaccination centers. Though yellow fever is not found in Chile, the shot is required in some South American countries, and yellow fever immunization protects travelers in tropical and sub-tropical areas.

Most diseases or disorders can be treated in Santiago.

A number of local physicians have obtained medical training in the U.S. and Europe. Well-trained, English-speaking dentists and orthodontists also are available. The cost of doctor visits or dental care by these English-speaking or foreign-trained practitioners is comparable to US prices.

There are several hospitals in Santiago that provide the full range of medical services found in US hospitals, usually at a lower cost than in the US.

Many medical facilities provide round-the-clock emergency services, including ambulance transportation and duty medical personnel.

A number of pharmacies are open 24 hours on a rotating basis, and a few others are open 24 hours daily. The cost of some drugs is high, and many medications sold in the United States are not available in Chile.

Some commonly prescribed drugs in Chile are not approved by the U.S. Food and Drug Administration and may have serious side effects.

Eyeglasses, including bifocals and contact lenses, and lens prescriptions can be obtained in Chile.

To protect your skin from the dry climate, body lotions, moisturizer creams and bath oils should be used. Suntan preparations should be worn at the beaches and skiing areas. Exposure to the sun should be limited to prevent severe burning, which occurs rapidly in this climate.

Community Health

Community health standards are generally fair in Santiago and compare to those of other large Latin American cities. The sewage system and trash collection are efficient. Nevertheless, earthquake damage and sometimes deficient supervision of sewage systems during construction and repair, e.g., road pavement, metro construction, etc., causes the drinking water to be occasionally contaminated in certain areas of the city. Otherwise the water is purified and generally safe to drink. Just the same, many people go through an adjustment period to the water due, in part, to its high mineral content; and some prefer to boil their drinking water. (To be effective water should boil for five minutes; however, boiling will not affect the mineral level.) Outside the larger cities water may be contaminated, and bottled water is recommended. No unusual pests or vermin problems exist in Santiago.

Food and beverages are generally safe. However, care is required in choosing restaurants and preparing raw fruits and vegetables. Milk sold in paper or plastic containers, often reconstituted, is pasteurized and safe. "Long-life" sterilized milk which does not require refrigeration prior to opening is readily available. To avoid tuberculosis, boil fresh milk found on farms. Good quality powdered and liquid processed milk is sold on the local market.

Santiago has a serious smog problem. Although the pollution hangs all year long in the congested downtown area, it is particularly heavy in the winter months when the fumes of heating fuels are added to the dust and the exhaust of vehicles. Even the outlying suburbs generally have air pollution problems, and there are days when the smog reaches up the slopes of the Cordillera. As a result, respiratory and eye, ear, nose, and throat problems are common for employees and dependents. Minor eye irritations are endemic on bad days, and "smokers' hack" hangs on for many nonsmokers throughout the winter. Joggers often quit running for the duration of their tours here because of the air pollution.

Preventive Measures

Because Santiago appears to be a relatively clean, modern city, people are often surprised at the number of intestinal problems they experience here. Almost no one is immune to these upsets (indigestion and diarrhea), but new arrivals are particularly susceptible to attacks, and mild disorders occur regardless of precautions taken. While most people adjust rapidly, some experience recurring problems throughout their tours. More serious infections such as bacillary dysentery, amoebic dysentery and typhoid fever usually can be avoided, if care is taken.

Wash all salad ingredients, berries, and fruits in an appropriate solution. (First they should be washed in detergent, rinsed, soaked in a solution of one tablespoon of chlorine solution to one gallon water for l5 minutes, and then thoroughlyrinsed again.) Antiseptic products such as Zonalin or iodine tablets are not as effective as a chlorine solution such as Chlorous or its local equivalent, Chlorous.

In restaurants, avoid fresh, unpeeled produce. Mayonnaise, custard, and creme fillings spoil quickly, especially in the summer months. Insist on the freshest seafood at markets and restaurants.

Typhoid and hepatitis do occur. All travellers are urged to renew typhoid and to be vaccinated against Hepatitis A.

Respiratory ailments are prevalent. Chile's climate, with its sharp temperature changes from day to night, coupled with the pollution and poorly heated houses, contributes to a high incidence of respiratory illnesses. Sore throats and sinusitis are common.

NOTES FOR TRAVELERS

Passage, Customs & Duties

A passport is required to enter Chile. U.S. citizens do not need a visa for a stay of up to three months. At the international port-of-entry, a fee, payable in U.S. dollars only, is levied on U.S. citizen visitors. The receipt is valid for multiple entries during the validity of the traveler's passport.

Dependent children under age 18 (including the children of divorced parents) arriving in Chile alone, with one parent, or in someone else's custody, are required to present a letter notarized before a Chilean consular officer in the United States certifying that both parents agree to their travel. To exit Chile, children traveling under one of these scenarios must present either the notarized letter used to enter the country or a letter of authorization signed before a Chilean notary if executed in Chile. In either case, the document presented must be executed not more than three months prior to entry or departure.

Travelers considering scientific, technical, or mountaineering activities in areas classified as frontier areas are required to obtain authorization from the Chilean government at least 90 days prior to the beginning of the expedition. The portions of Antarctica claimed by Chile are exempt from these pre-approval requirements. Officials at the Torres del Paine National Park require mountain climbers to present an authorization granted by the Frontiers and Border Department, obtainable at the Chilean Embassy or Chilean consulates throughout the United States.

For further information concerning entry, exit, and customs requirements, travelers may contact the Chilean Embassy at 1732 Massachusetts Avenue, N.W., Washington, DC 20036, tel. (202) 785-1746, Internet-http://www.chile-usa.org. Travelers may also contact the Chilean consulates in Los Angeles, San Diego, San Francisco, Clara, Miami, Honolulu, Chicago, New Orleans, Boston, New York, Philadelphia, San Juan, Charleston, Dallas, Houston, and Salt Lake City.

Americans living in or visiting Chile are encouraged to register at the Consular Section of the U.S. Embassy in Santiago and obtain updated information on travel and security in Chile. The U.S. Embassy is located at Avenida Andres Bello 2800, Santiago; tel. (56-2) 335-6550 or 232-2600; after hours tel. (56-2) 330-3321. The Embassy's mailing address is Casilla 27-D, Santiago; the Consular Section's fax number is (56-2) 330-3005; and the e-mail address is " santiagoamcit@state.gov". The Embassy home page is:http://www.usembassy.cl, where Americans may also register on-line.

Pets

Importation of household pets is permitted. The animal must be vaccinated against rabies within 30 days before arrival.

Health certificate issued by the US Animal Health Dept. must be obtained prior shipping pet. Rabbis and Health certificate are to be presented to Chilean animal Health Dept. upon entering Chile. Shipping a pet as accompanied baggage is usually safer, cheaper and more convenient than sending the animal alone. Animals are not quarantined upon arrival.

Currency, Banking, and Weights and Measures

The Chilean peso (CLP, written $) is Chile's official currency. The official rate of exchange as of June 2002 is CLP$660.74 pesos = US$1.00. This rate changes slightly on a daily basis. Chile has 46 banking facilities, including several U.S. banks, many of which have numerous branches.

Chile uses the metric system of weights and measures.

Disaster Preparedness

Chile is an earthquake-prone country. Limited information on Chilean earthquake preparedness is available in Spanish from the Oficina Nacional de Emergencia de Chile (ONEMI) via the Internet at http://www.angelfire.com/nt/terremotos2. Other general information about natural disaster preparedness is available from the U.S. Federal Emergency Management Agency (FEMA) athttp://www.fema.gov/.

LOCAL HOLIDAY

Jan. 1… New Year's Day

Mar/Apr. … Good Friday^*

Mar/Apr. … Easter^*

May 1… Labor Day

May 21… Battle of Iquique

June… Corpus Christi^*

Aug. 15 … Assumption Day

Sept. 11 … Official Holiday

Sept. 18 … Independence Day

Sept. 19 … Day of the Army

Nov.1 … All Saints' Day

Dec. 25… Christmas Day

^*variable

RECOMMENDED READING

These titles are provided as a general indication of the material published on this country. The Department of State does not endorse unofficial publications.

Alexander, Robert J. The ABC Presidents: Conversations & Correspondence with the Presidents of Argentina, Brazil, & Chile. Westport, CT: Greenwood Press, 1992.

Allende, Isabel. The House of Spirits. Alfred A Knopf, Inc.: New York, l986.

Aman, Kenneth, ed. Popular Culture in Chile. Boulder, CO: Westview Press, 1989.

American University. Chile, A Country Study. US Government Printing Office: Washington, DC, 1994.

Arriagada Herrera, Genaro. Pinochet: the Politics of Power. Boston, MA: Allen & Unwin, 1988.

Bizzarro, Salvatore. Historical Dictionary of Chile. 2nd ed., Iowa City, IA: University of Iowa Press, 1988.

Bradt, Hilary. Backpacking in Chile & Argentina. 2nd ed., Edison, NJ: Hunter Publishing, 1989.

Burr, Robert. By Reason or Force, Chile and Balancing Power in South America, 1830-1905. University of California Press: Berkeley, 1974

Committee on Foreign Affairs, USHouse of Representatives. United States and Chile During the Allende Years, 1970-73. US Government Printing Office: Washington, DC, 1975.

Constable, Pamela and Arturo Valenzuela, A nation of Enemies: Chile Under Pinochet. W.W. Norton & Co.: New York, 1991

Davis, Nathaniel. The Last Two Years of Salvador Allende. Cornell University Press: Ithaca, l985.

Drake, Paul W., and Ivan Jaksic, ed. The Struggle for Democracy in Chile, 1982-1990. Lincoln, NE: University of Nebraska Press, 1991.

Dwyer, Chris. Chile. New York:Chelsea House, 1989.

Falcoff, Mark. Modern Chile, 1970-1989. New Brunswick, NJ: Transaction Publishers, 1989.

Galvin, Irene Flum. Chile, Land of Poets and Patriots. Minneapolis, MN: Dillon Press, 1990.

Jacobsen, Karen. Chile. Chicago:Childrens Press, 1991.

Meehan, John. With Darwin in Chile. (Spanish translation, Con Darwin en Chile). Frederick Muller, Ltd.: London 1967.

Moran, Theodore H. Multinational Corporations and the Politics of Dependence: Copper in Chile. Princeton University Press: Princeton, 1974.

Nunn, Frederick. The Military in Chilean History. University of New Mexico Press: Albuquerque, 1976.

Rodriguez Monegal, Emir, ed. The Borzoi Anthology of Latin American Literature (Volumes I and II). Alfred K. Knopf: New York, 1977.

Samagalski, Alan. Chile & Easter Island: A Travel Survival Kit. Oakland, CA: Lonely Planet, 1990.

Sater, William F. Chile & the United States. Athens, GA: University of Georgia Press, 1991.

Sigmund, Paul. The Overthrow of Allende and the Politics of Chile 1964-1976. University of Pittsburgh Press: Pittsburgh, 1978.

——. The United States and Democracy in Chile. Johns Hopkins University Press, 1993.

Smith, Brian. The Church and Politics in Chile, Challenges to Modern Catholicism. Princeton University Press: Princeton, 1982.

Valenzuela, J.S. and A., eds. Military Rule in Chile, Johns Hopkins University Press, Baltimore, 1989.

Whalen, James Robert. Out of the Ashes: Chile's Revolution Without Honor. Washington, DC: Regnery Gateway, 1988.

Winter, Jane Kohen. Chile. New York: Marshall Cavendish, 1991.

Chile

Compiled from the January 2008 Background Note and supplemented with additional information from the State Department and the editors of this volume. See the introduction to this set for explanatory notes.

Official Name:

Republic of Chile

PROFILE

Geography

Area: 756,945 sq. km. (302,778 sq. mi.); nearly twice the size of California.

Cities: Capital—Santiago (metropolitan area est. 6 million). Other cities—Concepcion-Talcahuano (840,000), Vina del Mar-Valparaiso (800,000), Antofagasta (245,000), Temuco (230,000).

Terrain: Desert in north; fertile central valley; volcanoes and lakes toward the south, giving way to rugged and complex coastline; Andes Mountains on the eastern border.

Climate: Arid in north, Mediterranean in the central portion, cool and damp in south.

People

Nationality: Noun and adjective—Chilean(s).

Population: (2006) 16 million.

Annual population growth rate: 1.0%.

Ethnic groups: Spanish-Native-American (mestizo), European, Native-American.

Religions: Roman Catholic 89%; Protestant 11%.

Languages: Spanish.

Education: Years compulsory—12. Attendance—3 million. Adult literacy rate—96%.

Health: Infant mortality rate—8.9/ 1,000. Life expectancy—76 yrs.

Work force: (6.94 million); employed 6.4 million: Community, social and individual services—26%; industry—14.4%; commerce—17.6%; agriculture, forestry, and fishing—13.9%; construction—7.1%; financial services—7.5%; transportation and communication—8.0%; electricity, gas and water—0.5%; mining—1.2%.

Government

Type: Republic.

Independence: September 18, 1810.

Constitution: Promulgated September 11, 1980; effective March 11, 1981; amended in 1989, 1993, 1997, and 2005.

Government branches: Executive—president. Legislative—bicameral legislature. Judicial—Constitutional Tribunal, Supreme Court, court of appeals, military courts.

Political subdivisions: 12 numbered regions plus two new functioning regions—Arica and Los Rios—that are not numbered, as well as the Santiago metropolitan region, administered by appointed “inten-dentes.” Regions are divided into provinces, administered by appointed governors; provinces are divided into municipalities administered by elected mayors.

Political parties: Major parties are grouped into two large coalitions: 1) the center-left “Concertacion”, which includes the Christian Democrat Party, the Socialist Party, the Party for Democracy, and the Radical Social Democratic Party; and 2) the center-right “Alliance for Chile”, which includes the National Renewal Party and the Independent Democratic Union. The Communist Party joined the Humanistic Party and a number of smaller parties to form the “Together We Can” coalition in 2004, but none of these leftist parties have recently elected congressional representatives. A new center-left party, “Chile-First,” was established in October 2007.

Suffrage: Universal at 18, including foreigners legally resident for more than 5 years.

Economy (2006)

GDP: $118 billion.

Annual real growth rate: 4.0%.

Per capita GDP: $8,900.

Forestry, agriculture, and fisheries: (6% of GDP) Products—wheat, potatoes, corn, sugar beets, onions, beans, fruits, livestock, fish.

Commerce: (8% of GDP) Sales, restaurants, hotels.

Manufacturing: (17% of GDP) Types—mineral refining, metal manufacturing, food processing, fish processing, paper and wood products, finished textiles.

Electricity, gas, and water: 3% of GDP.

Transportation and communication: 7% of GDP.

Construction: 8% of GDP.

Financial services: (12% of GDP) Insurance, leasing, consulting.

Mining: (13% of GDP) Copper, iron ore, nitrates, precious metals, and molybdenum.

Trade: Exports—$58 billion: copper, fishmeal, fruits, wood products, paper products, fish, wine. Major markets—U.S. 16.1%, Japan 11%, China 9%, Netherlands 6.8%, South Korea 6.2%, Brazil 4%, Italy 5.1%, Mexico 4%. Imports—$35 billion: consumer goods, chemicals, motor vehicles, fuels, electrical machinery, heavy industrial machinery, food. Major suppliers—EU 16%, Argentina 12.9%, U.S. 16%, Brazil 12.2%, China 10.3%, South Korea 4.7%.

GEOGRAPHY

The northern Chilean desert contains great mineral wealth, principally copper. The relatively small central area dominates the country in terms of population and agricultural resources. This area also is the cultural and political center from which Chile expanded in the late 19th century, when it incorporated its northern and southern regions. Southern Chile is rich in forests and grazing lands and features a string of volcanoes and lakes. The southern coast is a labyrinth of fjords, inlets, canals, twisting peninsulas, and islands. The Andes Mountains are located on the eastern border.

PEOPLE

About 85% of Chile's population lives in urban areas, with 40% living in greater Santiago. Most have Spanish ancestry. A small, yet influential number of Irish and English immigrants came to Chile during the colonial period. German immigration began in 1848 and lasted for 90 years; the southern provinces of Valdivia, Llanquihue, and Osorno show a strong German influence. Other significant immigrant groups are Italian, Croatian, Basque, and Palestinian. About 800,000 Native Americans, mostly of the Mapuche tribe, reside in the south-central area. The Aymara and Diaguita groups can be found mainly in Chile's northern desert valleys.

HISTORY

About 10,000 years ago, migrating Indians settled in fertile valleys and along the coast of what is now Chile. The Incas briefly extended their empire into what is now northern Chile, but the area's barrenness prevented extensive settlement. The first Europeans to arrive in Chile were Diego de Almagro and his band of Spanish conquistadors, who came from Peru seeking gold in 1535. The Spanish encountered hundreds of thousands of Indians from various cultures in the area that modern Chile now occupies. These cultures supported themselves principally through slash-and-burn agriculture and hunting. The conquest of Chile began in earnest in 1540 and was carried out by Pedro de Valdivia, one of Francisco Pizarro's lieutenants, who founded the city of Santiago on February 12, 1541. Although the Spanish did not find the extensive gold and silver they sought, they recognized the agricultural potential of Chile's central valley, and Chile became part of the Viceroyalty of Peru.

The drive for independence from Spain was precipitated by usurpation of the Spanish throne by Napoleon's brother Joseph in 1808. A national junta in the name of Ferdinand—heir to the deposed king—was formed on September 18, 1810. The junta proclaimed Chile an autonomous republic within the Spanish monarchy. A movement for total independence soon won a wide following. Spanish attempts to reimpose arbitrary rule during what was called the “Reconquista” led to a prolonged struggle.

Intermittent warfare continued until 1817, when an army led by Bernardo O’Higgins, Chile's most renowned patriot, and José San Martín, hero of Argentine independence, crossed the Andes into Chile and defeated the royalists. On February 12, 1818, Chile was proclaimed an independent republic under O’Higgins’ leadership. The political revolt brought little social change, however, and 19th century Chilean society preserved the essence of the stratified colonial social structure, which was greatly influenced by family politics and the Roman Catholic Church. A strong presidency eventually emerged, but wealthy landowners remained extremely powerful. Toward the end of the 19th century, the government in Santiago consolidated its position in the south by ruthlessly suppressing the Mapuche Indians. In 1881, it signed a treaty with Argentina confirming Chilean sovereignty over the Strait of Magellan. As a result of the War of the Pacific with Peru and Bolivia (1879-83), Chile expanded its territory northward by almost one-third and acquired valuable nitrate deposits, the exploitation of which led to an era of national affluence. Chile established a parliamentary democracy in the late 19th century, but degenerated into a system protecting the interests of the ruling oligarchy. By the 1920s, the emerging middle and working classes were powerful enough to elect a reformist president, whose program was frustrated by a conservative congress. In the 1920s, Marxist groups with strong popular support arose.

Continuing political and economic instability resulted with the rule of the quasidictatorial Gen. Carlos Ibanez (1924-32). When constitutional rule was restored in 1932, a strong middle-class party, the Radicals, emerged. It became the key force in coalition governments for the next 20 years. During the period of Radical Party dominance (1932-52), the state increased its role in the economy.

The 1964 presidential election of Christian Democrat Eduardo Frei-Montalva by an absolute majority initiated a period of major reform. Under the slogan “Revolution in Liberty,” the Frei administration embarked on far-reaching social and economic programs, particularly in education, housing, and agrarian reform, including rural unionization

of agricultural workers. By 1967, however, Frei encountered increasing opposition from leftists, who charged that his reforms were inadequate, and from conservatives, who found them excessive. At the end of his term, Frei had accomplished many noteworthy objectives, but he had not fully achieved his party's ambitious goals. In 1970, Senator Salvador

Allende, a Marxist and member of Chile's Socialist Party, who headed the “Popular Unity” (UP) coalition of socialists, communists, radicals, and dissident Christian Democrats, won a plurality of votes in a three-way contest and was named President by the Chilean Congress. His program included the nationalization of private industries and banks, massive land expropriation, and collectivization. Allende's program also included the nationalization of U.S. interests in Chile's major copper mines.

Elected with only 36% of the vote and by a plurality of only 36,000 votes, Allende never enjoyed majority support in the Chilean Congress or broad popular support. Domestic production declined; severe shortages of consumer goods, food, and manufactured products were widespread; and inflation reached 1,000% per annum. Mass demonstrations, recurring strikes, violence by both government supporters and opponents, and widespread rural unrest ensued in response to the general deterioration of the economy. By 1973, Chilean society had split into two hostile camps.

A military coup overthrew Allende on September 11, 1973. As the armed forces bombarded the presidential palace, Allende reportedly committed suicide. A military government, led by General Augusto Pinochet, took over control of the country. The first years of the regime in particular were marked by serious human rights violations. A new Constitution was approved by a plebiscite on September 11, 1980, and General Pinochet became President of the Republic for an 8-year term. In its later years, the regime gradually permitted greater freedom of assembly, speech, and association, to include trade union activity. In contrast to its authoritarian political rule, the military government pursued decidedly laissez-faire economic policies. During its 16 years in power, Chile moved away from economic statism toward a largely free market economy that fostered an increase in domestic and foreign private investment. In a plebiscite on October 5, 1988, General Pinochet was denied a second 8-year term as president. Chileans voted for elections to choose a new president and the majority of members of a two-chamber congress. On December 14, 1989, Christian Democrat Patricio Aylwin, the candidate of a coalition of 17 political parties called the Concertacion, was elected president. Ayl-win served from 1990 to 1994 and was succeeded by another Christian Democrat, Eduardo Frei Ruiz-Tagle (son of the previous President), leading the same coalition, for a 6-year term. Ricardo Lagos Escobar of the Socialist Party and the Party for Democracy led the Concertacion to a narrower victory in 2000 presidential elections. His term ended on March 11, 2006, when President Michelle Bachelet Jeria, of the Socialist Party, took office.

GOVERNMENT AND POLITICAL CONDITIONS

Chile's Constitution was approved in a September 1980 national plebiscite. It entered into force in March 1981. After Pinochet's defeat in the 1988 plebiscite, the Constitution was amended to ease provisions for future amendments to the Constitution. In September 2005, President Ricardo Lagos signed into law several constitutional amendments passed by Congress. These include eliminating the positions of appointed senators and senators for life, granting the President authority to remove the commanders-in-chief of the armed forces, and reducing the presidential term from six to four years.

Presidential and congressional elections were held December 2005 and January 2006. In the first round of presidential elections, none of the four presidential candidates won more than 50% of the vote. As a result, the top two vote-getters—center-left Concertacion coalition's Michelle Bachelet and center-right Alianza coalition's Sebastian Pin-era—competed in a run-off election on January 15, 2006, which Michelle Bachelet won. This was Chile's fourth presidential election since the end of the Pinochet era. All four have been judged free and fair. The President is constitutionally barred from serving consecutive terms. President Bachelet and the new members of Congress took office on March 11, 2006.

Chile has a bicameral Congress, which meets in the port city of Valparaiso, about 140 kilometers (84 mi.) west of the capital, Santiago. Deputies are elected every 4 years, and Senators serve 8-year terms. Chile's congressional elections are governed by a unique binomial system that rewards coalition slates. Each coalition can run two candidates for the two Senate and two Deputy seats apportioned to each electoral district. Historically, the two largest coalitions (Concertacion and Alianza) split most of the seats in a district. Only if the leading coalition ticket out-polls the second-place coalition by a margin of more than 2-to-1 does the winning coalition gain both seats.

In the December 11, 2005 congressional elections, the Concertacion coalition won a majority in both the Senate and the Chamber of Deputies. In the 38-member Senate, the Concertacion coalition holds 19 seats and the Alianza opposition holds 17. There are two independents. In the 120-member Chamber of Deputies, the Concertacion coalitions holds 62 seats and the Alianza holds 53. There are five independents.

Chile's judiciary is independent and includes a court of appeal, a system of military courts, a constitutional tribunal, and the Supreme Court. In June 2005, Chile completed a nationwide overhaul of its criminal justice system. The reform has replaced inquisitorial proceedings with an adversarial system more similar to that of the United States.

Principal Government Officials

Last Updated: 2/1/2008

Pres.: Michelle BACHELET

Min. of Agriculture: Alvaro ROJAS

Min. of Culture: Paulina URRUTIA

Min. of Defense: Jose GONI

Min. of Economy, Development, & Reconstruction: Alejandro FERREIRO

Min. of Education: Yasna PROVOSTE

Min. of Energy: Marcelo TOKMAN

Min. of Environment: Ana Lya URIARTE

Min. of Finance: Andres VELASCO

Min. of Foreign Relations: Alejandro FOXLEY

Min. of Health: Maria BARRIA

Min. of Housing, Urbanism, & Public Lands: Patricia POBLETE

Min. of Interior: Belisario VELASCO

Min. of Justice: Carlos MALDONADO

Min. of Labor & Social Security: Osvaldo ANDRADE

Min. of Mining: Karen PONIACHIK

Min. of Planning & Cooperation: Clarisa HARDY

Min. of Public Works: Eduardo BITRAN

Min. of State & National Property: Romy SCHMIDT

Min. of Transportation: Rene CORTAZAR

Min. of Women's Affairs: Laura ALBORNOZ

Min. Sec. Gen. of the Presidency: Jose Antonio VIERA-GALLO

Pres., Central Bank: Jose DE GREGORIO

Ambassador to the US: Mariano FERNANDEZ

Permanent Representative to the UN, New York: Heraldo Benjamin MUNOZ Valenzuela

Chile maintains an embassy in the United States at 1732 Massachusetts Avenue, NW, Washington, DC 20036; tel: 202-785-1746, fax: 202-659-9624, email: embassy@embassyofchile.org.

DEFENSE

Chile's Armed Forces are subject to civilian control exercised by the President through the Minister of Defense. The President has the authority to remove the commanders-in-chief of the armed forces.

Army

The commander in chief of the Chilean Army is General Oscar Izurieta Ferrer. The Chilean Army is 45,000 strong and is organized with an Army headquarters in Santiago, seven divisions throughout its territory, an Air Brigade in Rancagua, and a Special Forces Command in Colina. The Chilean Army is one of the most professional and technologically advanced armies in Latin America.

Navy

Admiral Rodolfo Codina directs the 23,000-person Navy, including 2,500 Marines. Of the fleet of 29 surface vessels, only eight are operational major combatants (frigates). Those ships are based in Valparaiso. The Navy operates its own aircraft for transport and patrol; there are no Navy fighter or bomber aircraft. The Navy also operates four submarines based in Talcahuano.

Air Force (FACH)

Gen. Ricardo Ortega Perrier heads a force of 12,500. Air assets are distributed among five air brigades headquartered in Iquique, Antofagasta, Santiago, Puerto Montt, and Punta Arenas. The Air Force also operates an airbase on King George Island, Antarctica. The FACH took delivery of the final 2 of 10 F-16s, all purchased from the U.S., in March 2007. Chile also took delivery in 2007 of a number of reconditioned Block 15 F-16s from the Netherlands, bringing to 18 the total of F-16s purchased from the Dutch.

Carabineros

After the military coup in September 1973, the Chilean national police (Carabineros) were incorporated into the Defense Ministry. With the return of democratic government, the police were placed under the operational control of the Interior Ministry but remained under the nominal control of the Defense Ministry. Gen. Jose Bernales is the head of the national police force of 30,000 men and women who are responsible for law enforcement, traffic management, narcotics suppression, border control, and counter-terrorism throughout Chile.

ECONOMY

After a decade of impressive growth rates, Chile began to experience a moderate economic downturn in 1999, brought on by unfavorable global economic conditions related to the Asian financial crisis, which began in 1997. The economy remained sluggish until 2003, when it began to show clear signs of recovery, achieving 3.3% real GDP growth. The Chilean economy finished 2004 with growth of 6.1%. Real GDP growth reached 6.3% in 2005 before falling back to 4.0% growth in 2006. Higher energy prices as well as lagging consumer demand were drags on the economy in 2006. Higher Chilean Government spending and favorable external conditions (including record copper prices for much of 2006) were not enough to offset these drags. For the first time in many years, Chilean economic growth in 2006 was among the weakest in Latin America.

Chile has pursued generally sound economic policies for nearly three decades. The 1973-90 military government sold many state-owned companies, and the three democratic governments since 1990 have continued privatization, though at a slower pace. The government's role in the economy is mostly limited to regulation, although the state continues to operate copper giant CODELCO and a few other enterprises (there is one state-run bank). Chile is strongly committed to free trade and has welcomed large amounts of foreign investment. Chile has signed free trade agreements (FTAs) with a whole network of countries, including an FTA with the United States, which was signed in 2003 and implemented in January 2004. Over the last several years, Chile has signed FTAs with the European Union, South Korea, New Zealand, Singapore, Brunei, China, and Japan. It reached a partial trade agreement with India in 2005 and began negotiations for a full-fledged FTA with India in 2006. Chile conducted trade negotiations in 2007 with Australia, Malaysia, and Thailand, as well as with China to expand an existing agreement beyond just trade in goods. Chile hopes to conclude FTA negotiations with Australia and the expanded agreement with China in 2008. Negotiations with Malaysia and Thailand are scheduled to continue throughout 2008. The members of the P4 (Chile, Singapore, New Zealand, and Brunei) also plan to conclude a chapter on finance and investment in 2008.

High domestic savings and investment rates helped propel Chile's economy to average growth rates of 8% during the 1990s. The privatized national pension system (AFP) has encouraged domestic investment and contributed to an estimated total domestic savings rate of approximately 21% of GDP. However, the AFP is not without its critics, who cite low participation rates (only 55% of the working population is covered), with groups such as the self-employed outside the system. There has also been criticism of the inefficiency and high costs due to a lack of competition among pension funds. Critics cite loopholes in the use of pension savings through lump sum withdraws for the purchase of a second home or payment of university fees as fundamental weaknesses of the AFP. The Bachelet administration plans substantial reform, but not an overhaul, of the AFP during the next several years.

Unemployment stubbornly hovered in the 8%-10% range after the start of the economic slowdown in 1999, well above the 5%-6% average for the 1990s. Unemployment finally dipped to 7.8% at the end of 2006, due largely to the fact that fewer Chileans were entering the workforce rather than to a substantial and sustained creation of new jobs. Most international observers place some of the blame for Chile's consistently high unemployment rate on complicated and restrictive labor laws. Wages have risen faster than inflation as a result of higher productivity, boosting national living standards. The percentage of Chileans with incomes below the poverty line—defined as twice the cost of satisfying a family of four's minimal nutritional needs—fell from 46% in 1987 to around 18% by 2004.

Chile's independent Central Bank pursues an inflation target of between 2% and 4%. Inflation has not exceeded 5% since 1998. Chile registered an inflation rate of 3.2% in 2006. The Chilean peso's rapid appreciation against the U.S. dollar in recent years has helped dampen inflation. Most wage settlements and loans are indexed, reducing inflation's volatility. Under the compulsory private pension system, most formal sector employees pay 10% of their salaries into privately managed funds.

Total foreign direct investment (FDI) was only $3.4 billion in 2006, up 52% from a poor performance in 2005. However, 80% of FDI continues to go to only four sectors: electricity, gas, water and mining. Much of the jump in FDI in 2006 was also the result of acquisitions and mergers and has done little to create new employment in Chile. The Chilean Government has formed a Council on Innovation and Competition, which is tasked with identifying new sectors and industries to promote. It is hoped that this, combined with some tax reforms to encourage domestic and foreign investment in research and development, will bring in additional FDI and to new parts of the economy. As of 2006, Chile invested only 0.6% of its annual GDP in research and development (R&D). Even then, two-thirds of that was government spending. The fact that domestic and foreign companies spend almost nothing on R&D does not bode well for the Government of Chile's efforts to develop innovative, knowledge-based sectors. Additionally, on January 8, 2007, Chile was placed on the U.S. Trade Representatives Priority Watch List due to its poor record on protecting intellectual property rights. Chile is only the second U.S. FTA partner ever to be placed on the Priority Watch List. Chile has a poor and deteriorating record of protecting copyrighted music, films, and software. Combined with this is its institutional structure allowing local companies to produce and market pharmaceutical generics that violate existing patents. Beyond its general economic and political stability, the government also has encouraged the use of Chile as an “investment platform” for multinational corporations planning to operate in the region, but this will have limited value given the developing business climate in Chile itself. Chile's approach to foreign direct investment is codified in the country's Foreign Investment Law, which gives foreign investors the same treatment as Chileans. Registration is simple and transparent, and foreign investors are guaranteed access to the official foreign exchange market to repatriate their profits and capital. While Chile and the EU have signed a double taxation treaty, no such agreement exists between the U.S. and Chile.

Foreign Trade

2006 was a record year for Chilean trade. Total trade registered a 31% increase over 2005. During 2006, exports of goods and services totaled U.S. $58 billion, an increase of 41%. This figure was somewhat distorted by the skyrocketing price of copper. In 2006, copper exports reached a historical high of U.S. $33.3 billion. Imports totaled U.S. $35 billion, an increase of 17% compared to the previous year. Chile thus recorded a positive trade balance of U.S. $23 billion in 2006.

The main destinations for Chilean exports were the Americas (U.S. $39 billion), Asia (U.S. $27.8 billion) and Europe (U.S. $22.2 billion). Seen as shares of Chile's export markets, 42% of exports went to the Americas, 30% to Asia and 24% to Europe. Within Chile's diversified network of trade relationships, its most important partner remained the United States. Total trade with the U.S. was U.S. $14.8 billion in 2006. Since the U.S.-Chile Free Trade Agreement went into effect on January 1, 2004, U.S.-Chilean trade has increased by 154%. Internal Government of Chile figures show that even when factoring out inflation and the recent high price of copper, bilateral trade between the U.S. and Chile has grown over 60% since then.

Total trade with Europe also grew in 2006, expanding by 42%. The Netherlands and Italy were Chile's main European trading partners. Total trade with Asia also grew significantly at nearly 31%. Trade with Korea and Japan grew significantly, but China remained Chile's most important trading partner in Asia. Chile's total trade with China reached U.S. $8.8 billion in 2006, representing nearly 66% of the value of its trade relationship with Asia.

The growth of exports in 2006 was due mainly to a strong increase in sales to the United States, the Netherlands, and Japan. These three markets alone accounted for an additional U.S. $5.5 billion worth of Chilean exports. Chilean exports to the United States totaled U.S. $9.3 billion, representing a 37.7% increase compared to 2005 (U.S. $6.7 billion). Exports to the European Union were U.S. $15.4 billion, a 63.7% increased compared to 2005 (U.S. $9.4 billion). Exports to Asia increased from U.S. $15.2 billion in 2005 to U.S. $19.7 billion in 2006, a 29.9% increase.

During 2006, Chile imported U.S. $26 billion from the Americas, representing 54% of total imports, followed by Asia at 22%, and Europe at 16%. Mercosur members were the main suppliers of imports to Chile at U.S. $9.1 billion, followed by the United States with U.S. $5.5 billion and the European Union with U.S. $5.2 billion. From Asia, China was the most important exporter to Chile, with goods valued at U.S. $3.6 billion. Year-on-year growth in imports was especially strong from a number of countries—Ecuador (123.9%), Thailand (72.1%), Korea (52.6%), and China (36.9%).

Chile's overall trade profile has traditionally been dependent upon copper exports. The state-owned firm CODELCO is the world's largest copper-producing company, with recorded copper reserves of 200 years. Chile has made an effort to expand nontraditional exports. The most important non-mineral exports are forestry and wood products, fresh fruit and processed food, fishmeal and seafood, and wine.

Successive Chilean governments have actively pursued trade-liberalizing agreements. During the 1990s, Chile signed FTAs with Canada, Mexico, and Central America. Chile also concluded preferential trade agreements with Venezuela, Colombia, and Ecuador. An association agreement with Mercosur—Argentina, Brazil, Paraguay, and Uruguay—went into effect in October 1996. Continuing its export-oriented development strategy, Chile completed landmark free trade agreements in 2002 with the European Union and South Korea. Chile, as a member of the Asia-Pacific Economic Cooperation (APEC) organization, is seeking to boost commercial ties to Asian markets. To that end, it has signed trade agreements in recent years with New Zealand, Singapore, Brunei, India, China, and most recently Japan. In 2007, Chile held trade negotiations with Australia, Thailand, Malaysia, and China. In 2008, Chile hopes to conclude an FTA with Australia, and finalize an expanded agreement (covering trade in services and investment) with China. The P4 (Chile, Singapore, New Zealand, and Brunei) also plan to expand ties through adding a finance and investment chapter to the existing P4 agreement. Chile's trade talks with Malaysia and Thailand are also scheduled to continue in 2008.

After two years of negotiations, the United States and Chile signed an agreement in June 2003 that will lead to completely duty-free bilateral trade within 12 years. The U.S.-Chile FTA entered into force January 1, 2004 following approval by the U.S. and Chilean congresses. The bilateral FTA has inaugurated greatly expanded U.S.-Chilean trade ties, with total bilateral trade jumping by 154% during the FTA's first three years.

Chile unilaterally lowered its across-the-board import tariff for all countries with which it does not have a trade agreement to 6% in 2003. Higher effective tariffs are charged only on imports of wheat, wheat flour, and sugar as a result of a system of import price bands. The price bands were ruled inconsistent with Chile's World Trade Organization (WTO) obligations in 2002, and the government has introduced legislation to modify them. Under the terms of the U.S.-Chile FTA, the price bands will be completely phased out for U.S. imports of wheat, wheat flour, and sugar within 12 years.

Chile is a strong proponent of pressing ahead on negotiations for a Free Trade Area of the Americas (FTAA) and is active in the WTO's Doha round of negotiations, principally through its membership in the G-20 and Cairns Group.

Finance

Chile's financial sector has grown quickly in recent years, with a banking reform law approved in 1997 that broadened the scope of permissible foreign activity for Chilean banks. The Chilean Government implemented a further liberalization of capital markets in 2001, and there is further pending legislation proposing further liberalization. Over the last ten years, Chileans have enjoyed the introduction of new financial tools such as home equity loans, currency futures and options, factoring, leasing, and debit cards. The introduction of these new products has also been accompanied by an increased use of traditional instruments such as loans and credit cards. Chile's private pension system, with assets worth roughly $70 billion at the end of 2006, has been an important source of investment capital for the capital market. Chile maintains one of the best credit ratings (S&P A+) in Latin America. There are three main ways for Chilean firms to raise funds abroad: bank loans, issuance of bonds, and the selling of stocks on U.S. markets through American Depository Receipts (ADRs). Nearly all of the funds raised through these means go to finance domestic Chilean investment. The government is required by law to run a fiscal surplus of at least 1% of GDP. In 2006, the Government of Chile ran a surplus of $11.3 billion, equal to almost 8% of GDP. The Government of Chile continues to pay down its foreign debt, with public debt only 3.9% of GDP at the end of 2006.

FOREIGN RELATIONS

Since its return to democracy in 1990, Chile has been an active participant in the international political arena. Chile completed a 2-year non-permanent position on the UN Security Council in January 2005. Jose Miguel Insulza, a Chilean national, was elected Secretary General of the Organization of American States in May 2005. Chile is currently serving on the International Atomic Energy Agency (IAEA) Board of Governors, and the 2007-2008 chair of the board is Chile's ambassador to the IAEA, Milenko E. Skoknic. The country is an active member of the UN family of agencies and participates in UN peacekeeping activities. It is currently bidding for a seat on the UN Human Rights Council. Chile hosted the Defense Ministerial of the Americas in 2002 and the APEC summit and related meetings in 2004. It also hosted the Community of Democracies ministerial in April 2005 and the Ibero-American Summit in November 2007. An associate member of Mercosur and a full member of APEC, Chile has been an important actor on international economic issues and hemispheric free trade.

The Chilean Government has diplomatic relations with most countries. It settled its territorial disputes with Argentina during the 1990s. Chile and Bolivia severed diplomatic ties in 1978 over Bolivia's desire to reacquire territory it lost to Chile in 1879-83 War of the Pacific. The two countries maintain consular relations and are represented at the Consul General level.

U.S.-CHILEAN RELATIONS

Relations between the United States and Chile are better now than at any other time in history. The U.S. Government applauded the rebirth of democratic practices in Chile in the late 1980s and early 1990s and sees the maintenance of a vibrant democracy and a healthy and sustainable economy as among the most important U.S. interests in Chile. Besides the landmark 2003 U.S.-Chile FTA, the two governments consult frequently on issues of mutual concern, including in the areas of multilateral diplomacy, security, culture, and science.

U.S. Embassy Functions

In addition to working closely with Chilean Government officials to strengthen our bilateral relationship, the U.S. Embassy in Santiago provides a wide range of services to U.S. citizens and businesses in Chile. (Please see the embassy's home page for details of these services.) The Embassy also is the locus for a number of American community activities in the Santiago area.

The Public Affairs Section cooperates with universities and non-governmental organizations (NGOs) on a variety of programs of bilateral interest. Of special note are extensive U.S. Speaker, International Visitor, and Fulbright programs. Themes of particular interest include trade, international security, democratic governance in the region, judicial reform, law enforcement, environmental issues, and the teaching of English. The Public Affairs Section works daily with Chilean media, which has a keen interest in bilateral and regional relations. It also assists visiting foreign media, including U.S. journalists, and is regularly involved in press events for high-level visitors.

Attachés at the Embassy from the Foreign Commercial Service, Foreign Agricultural Service, and the Animal and Plant Health Inspection Service (APHIS) work closely with the hundreds of U.S. companies who export to or maintain offices in Chile. These officers provide information on Chilean trade and industry regulations and administer several programs intended to support U.S. companies’ sales in Chile.

The Consular Section of the Embassy provides vital services to the more than 12,000 U.S. citizens residing in Chile. It assists Americans who wish to vote in U.S. elections while abroad, provides U.S. tax information, and facilitates government benefits/social security payments. Besides those U.S. citizens resident in Chile, about 170,000 U.S. citizens visit Chile annually. The Consular Section offers passport and emergency services to U.S. tourists during their stay in Chile. It also issues about 40,000 visitor visas annually to Chilean citizens who plan to travel to the United States.

Principal U.S. Embassy Officials

Last Updated: 2/19/2008

SANTIAGO (E) 2800 Av. Andrés Bello, APO/FPO APO AA 34033, +56-2-330-3000, Fax +56-2-330-3710, Workweek: Mon-Fri 8:30-17:00, Web-site: http://santiago.usembassy.gov.

Other Contact Information

American Chamber of Commerce in Chile
Avenida Presidente Kennedy 5735, Oficina 201
Torre Poniente, Las Condes Santiago
Tel: 562-290-9700
Fax: 562-212-2620
Email: amcham@amchamchile.cl
Website:
http://www.amchamchile.cl (Spanish) http://www.amchamchile.cl/english(English)

Comite de Inversiones
Extranjeras (Foreign Investment Committee)
Andres Culagovski, Acting
Executive Vice President
Teatinos 120, P. 10; Santiago, Chile
Tel: 562-698-4254
Fax: 562-698-9476
Website: www.foreigninvestment.cl

Chilean Government Agencies Website: www.chileangovernment.c1/

U.S. Department of Commerce Trade Information Center International Trade Administration
14th and Constitution Avenue, NW
Washington, DC 20230 Tel: 800-USA-TRADE Fax: 202-482-4726
Website: http://trade.gov.

Additional information regarding U.S. and U.S.-Chile trade can be found at the following websites: www.export.gov/ and http://www.buy-usa.gov/chile/en/.

TRAVEL

Consular Information Sheet

October 23, 2007

Country Description: Chile is a rapidly developing country with a large, educated middle class and a robust free-market economy. Tourist facilities are generally good and are continuously improving.

Entry Requirements: United States citizens entering Chile for business or pleasure must have a valid passport and visa. Visas may be obtained at the port of entry upon payment of a fee. The visa is valid for multiple entries to Chile and remains valid until the expiration of the passport. U.S. citizens are admitted to Chile for up to 90 days. An extension of stay for an additional 90 days is possible, but requires payment of another fee. Visitors will be issued a Tourist Card upon entry that must be surrendered upon departure. Visit the Embassy of Chile web site at www.chile-usa.org for the most current visa information.

Safety and Security: The potential for terrorist activity is low. There has been some politically motivated violence among indigenous communities in southern Chile, none of which has affected Americans. Potential for civil disturbance is low, although demonstrations, sometimes violent, do occur, particularly on the anniversary of the September 11, 1973 coup against the government of President Salvador Allende.

For the latest security information, Americans traveling abroad should regularly monitor the Department's Internet web site where the current Worldwide Caution Travel Alert, Travel Warnings and Travel Alerts can be found. Up-to-date information on safety and security can also be obtained by calling 1-888-407-4747 toll free in the U.S., or for callers out-side the U.S. and Canada, a regular toll-line at 1-202-501-4444.

Crime: Crime rates are low to moderate throughout Chile and are moderate in Santiago, Valparaiso, and other major cities. American citizens visiting Chile should be as careful in cities as they would be in any city in the United States. There have been few violent crimes committed against Americans. However, American tourists are at a heightened risk for pick pocketing, purse or camera snatching, and theft from backpacks and rental cars. Such crimes have been reported in all areas of Chile frequented by tourists. In Santiago, visitors should be especially alert to the possibility of crime at the Plaza de Armas and the Mercado Central; at major hotels and restaurants in the Las Condes, Vitacura, and Providencia areas, and in the Suecia and Bellavista entertainment districts. In Valparaiso, visitors should be especially alert in the port and adjoining tourist areas. Tourists using taxis in Santiago should be alert to possible scams involving currency switching. The emergency number for the police (Carabineros) is 133

In many countries around the world, counterfeit and pirated goods are widely available. Transactions involving such products may be illegal under local law. In addition, bringing them back to the United States may result in forfeitures and/ or fines. More information on this serious problem is available at http://www.cybercrime.gov/18usc2320.htm.

Information for Victims of Crime: The loss or theft abroad of a U.S. passport should be reported immediately to the local police and the nearest U.S. Embassy or Consulate. If you are the victim of a crime while overseas, in addition to reporting to local police, please contact the nearest U.S. Embassy or Consulate for assistance. The Embassy/Consulate staff can, for example, assist you to find appropriate medical care, contact family members or friends and explain how funds could be transferred. Although the investigation and prosecution of the crime is solely the responsibility of local authorities, consular officers can help you to understand the local criminal justice process and to find an attorney if needed.

Medical Facilities and Health Information: Medical care, though generally good, may not meet U.S. standards, especially in remote areas. Although emergency rooms in some major hospitals accept credit cards, many doctors and hospitals in Chile expect immediate payment in cash. Prescription and over the counter medicines are widely available. Air pollution is a major source of health concern in Santiago. The most severe air pollution occurs during the winter (May through August).

Information on vaccinations and other health precautions, such as safe food and water precautions and insect bite protection, may be obtained from the Centers for Disease Control and Prevention's hotline for international travelers at 1-877-FYI-TRI. (1-877-394-8747) or from the CDC's web site at http://wwn.cdc.gov/travel/default.aspx. For information about outbreaks of infectious diseases abroad consult the World Health Organization's (WHO) web site at http://www.who.int/en. Further health information for travelers is available at http://www.who.int/ith/en.

Medical Insurance: The Department of State strongly urges Americans to consult with their medical insurance company prior to traveling abroad to confirm whether their policy applies overseas and whether it will cover emergency expenses such as a medical evacuation.

Traffic Safety and Road Conditions: While in a foreign country, U.S. citizens may encounter road conditions that differ significantly from those in the United States. The information below concerning Chile is provided for general reference only, and may not be totally accurate in a particular location or circumstance

Driving in Chile is on the right-hand side of the road. Several modern toll highways have recently been opened in and around Santiago, dramatically improving transit into and through the city. Major roads are generally in good condition throughout the country. Some secondary roads, however, may be poorly maintained. At night, heavy fog conditions in rural areas have led to multiple vehicle accidents with occasional deaths and injuries. Care should be taken while driving in the mountains because the roads tend to have many tight switchbacks and rarely have guardrails. Chains are often required and should be used on mountain roads during the winter. Many major highways in Chile are toll roads; drivers should carry a sufficient amount of local currency to cover the tolls. The new major high-ways in and around Santiago generally collect tolls through use of an electronic transmitter issued by the concessionaire and placed on the vehicle. “Day passes” may be purchased separately. Vehicles rented at Santiago airport generally are equipped with the electronic transmitter and the rental car companies charge a surcharge for its use. Some major arteries remain under construction in Santiago and drivers should be alert for detours and delays.

Throughout Chile, but especially in Santiago, care should be exercised when changing lanes or merging because many drivers do not signal lane changes and rarely yield to merging traffic. Buses are especially aggressive in moving between lanes. Speeding is common, including in urban areas. Traffic jams and detours in Santiago and other areas are common. Taxis are plentiful and relatively inexpensive. Drivers should drive with car doors locked at all times, especially in the southern parts of the city and near the airport, as there have been reports of thieves entering cars stopped at traffic lights or moving in slow traffic. In Santiago, certain major arteries switch directions during morning and evening rush hours. Visitors to Santiago should obtain up-to-date information on these changes from their auto rental company or the Chilean Automobile Association (please see below).

Driving under the influence of alcohol in Chile is severely punished, and can result in incarceration if the driver is involved in an accident. Individuals arrested for driving under the influence over a weekend can expect to remain incarcerated until the next business day when they will appear before a judge.

Visitors must have an international driver's permit in order to drive legally in Chile. Although car rental firms may rent to customers with only a U.S. driver's license, the police have detained several persons for lengthy periods for driving without a valid international permit.

Visit the web site of Chile's national tourist office and national authority responsible for road safety at www.sernatur.cl.

Aviation Safety Oversight: The U.S. Federal Aviation Administration (FAA) has assessed the Government of Chile's Civil Aviation Authority as being in compliance with International Civil Aviation Organization (ICAO) aviation safety standards for oversight of Chile's air carrier operations. For more information, travelers may visit the FAA's web site at http://www.faa.gov.

Special Circumstances: Visitors should take care to use only the services of government licensed tour operators throughout Chile as the Embassy is aware of at least one accident involving American fatalities with an unauthorized tour operator. Special care should be taken by arriving cruise ship passengers if arranging land tours not authorized by the cruise line.

Chile is an earthquake prone country. Information on Chilean earthquake preparedness is available from the Oficina Nacional de Emergencia de Chile (ONEMI) via the Internet at www.onemi.cl. General information about natural disaster preparedness is available via the Internet from the U.S. Federal Emergency Management Agency (FEMA) at www.fema.gov. Information about emergency preparedness is also available on the Embassy web site at santiago.usembassy.gov.

Minefields are found in Chile's northern border with Peru and Bolivia and on the southern border with Argentina in Patagonia. Minefields are generally marked, but markers may have been shifted, become obscured or been vandalized. Travelers should pay attention to markers and follow clearly identified roads and trails when traveling in minefield areas. Border crossings should only be made at authorized locations. Persons visiting wilderness areas in the border regions mentioned above should check with park or other local officials concerning minefields and other potential hazards.

Chile is a popular destination for outdoors and adventure sports. Much of the country is mountain, forest, desert, or glacier. Despite the best efforts of local authorities, assisting persons lost or injured in such areas can be problematic. American citizens have been killed in recent years in mountain climbing and white water rafting accidents, and seriously injured while skiing. Persons planning to travel in isolated and wilderness areas should first learn about local hazards and weather conditions. Information about parks and wilderness areas can be obtained from the Chilean Forestry Service at www.conaf.cl. Information about mountain climbing in Chile can be obtained from the Federacion de Andinismo de Chile at www.feach.cl. Current weather forecasts are available from the Chilean Meteorological Service at www.meteochile.cl. Reports of missing or injured persons should be made immediately to the police so that a search can be mounted or assistance rendered. Socorro Andino (www.socorroandino.cl) is a volunteer organization that provides mountain search and rescue services that supplement police efforts. Persons traveling in isolated areas should always inform park rangers, police, or other local authorities of their itinerary before starting off.

Travelers should be aware that they might have difficulty using U.S. $100 bills due to concerns about falsification. The United States Secret Service has provided Chilean banks and local police with the tools and training needed to identify counterfeit U.S. currency. Although the training was very successful, many Chilean banks, exchange houses and business still refuse to accept the $100 notes. Whenever possible visitors to Chile should use Traveler's Checks or bring notes smaller than $50.

Criminal Penalties: While in a foreign country, a U.S. citizen is subject to that country's laws and regulations, which sometimes differ significantly from those in the United States and may not afford the protections available to the individual under U.S. law. Penalties for breaking the law can be more severe than in the United States for similar offenses. Persons violating Chilean laws, even unknowingly, may be expelled, arrested or imprisoned. Penalties for possession, use, or trafficking in illegal drugs in Chile are severe, and convicted offenders can expect long jail sentences and heavy fines. Engaging in sexual conduct with children or using or disseminating child pornography in a foreign country is a crime, prosecutable in the United States.

Children's Issues: For information on international adoption of children and international parental child abduction, see the Office of Children's Issues website at http://travel.state.gov/family.

Registration and Embassy Locations: Americans living or traveling in Chile are encouraged to register with the nearest U.S. Embassy or Consulate through the State Department's travel registration web site so that they can obtain updated information on travel and security within Chile. Americans without Internet access may register directly with the nearest U.S. Embassy or Consulate. By registering, American citizens make it easier for the Embassy or Consulate to contact them in case of emergency. The U.S. Embassy is located at Avenida Andres Bello 2800, Santiago, Chile. The telephone number is (56) (2) 232-2600. The Embassy web site is santiago.usem-bassy.gov and the email address is SantiagoAMCIT@state.gov. The Consular Section fax number is (56) (2) 330-3005. The American Citizen Services section is open to the public from 8:30am-11:30am, Monday through Friday, except American and Chilean holidays.

International Adoption

April 2006

The information in this section has been edited from a report of the State Department Bureau of Consular Affairs, Office of Overseas Citizens Services. For more information, please read the International Adoption section of this book and review current reports online at http://travel.state.gov/family.

Disclaimer: The information in this flyer relating to the legal requirements of specific foreign countries is based on public sources and current understanding. Questions involving foreign and U.S. immigration laws and legal interpretation should be addressed respectively to qualified foreign or U.S. legal counsel.

Please Note: Chilean adoption law gives priority to Chilean families over non-Chilean families. Most Chilean children available for intercountry adoption are at least four years old. Not all children eligible for adoption in Chile meet U.S. immigration requirements to receive an orphan visa, so it is important that adopting families consult with the U.S. Embassy in Santiago before beginning any adoption procedures to ensure that the adoption complies with U.S. law. Under Chilean law, children to be adopted may not leave the country until the adoption is complete.

Patterns of Immigration: Please review current reports online at http://travel.state.gov/family.

Adoption Authority: SENAME (Servicio Nacional de Menores) is the clearinghouse for adoptions and approves parents who wish to adopt. Prospective adopting families must contact SENAME first before beginning any adoption proceedings. SENAME can be reached at:

Servicio Nacional de Menores de
Chile (SENAME)
Unidad de Adopción
Huerfanos 587
Santiago, Chile
Telephone: (56)(2) 398-4447
www.sename.c1

Eligibility Requirements for Adoptive Parents: Only married couples between the ages of 25 and 60 can adopt in Chile. The adoptive parents must both be at least 20 years older than the child being adopted.

Residency Requirements: There are no residency requirements to adopt in Chile.

Time Frame: Intercountryadoptions from Chile normally take about two (2) years from start to finish. This time is measured from the time the prospective adoptive parents contact SENAME expressing their intention to adopt until the time the adoption is completed. Reasons for this prolonged length of time vary from availability of children to length of time to obtain hearings.

Adoption Agencies and Attorneys: Chilean adoption law provides for SENAME to oversee the adoption process from the request to terminate parental rights to the issuance of the final adoption decree. Please review current reports online at http://travel.state.gov/family for a list of agencies.

Adoption Fees: Fees vary, but prospective adoptive parents should expect to spend no more than $3000. Prospective adoptive parents should report exorbitant fees to the U.S. Embassy or SENAME.

Adoption Procedures: Families interested in adopting in Chile must apply and be approved by SENAME, which keeps the national registry of children eligible for adoption. The first stage of the application process is to send SENAME, at the address above, a letter or email that includes both prospective adoptive parents’ names, dates of birth, contact information and any preferences, including the reasons for these preferences, for a child or children.

The children on the national registry have been declared eligible for adoption (susceptible de ser adoptado) by a judge and all parental rights have been terminated. SENAME matches available children with prospective adoptive parents. Blood relatives are always given priority, followed by unrelated Chilean families, then non-Chilean families. Prospective adoptive parents do have the right to decline a specific match, which they would do by simply notifying SENAME.

Prospective adoptive parents should consider carefully declining a specific match as they will be required to begin the process again and will have to explain, in detail, the reason for their declination.

After a child is successfully matched with a family, there is a wait to obtain a hearing with a judge. The normal wait time is between 6 to 12 months. At the hearing, the judge may determine that the prospective adoptive parents need to provide further documentation, but all of the stated required documents would have already been submitted and in the adoption file. Either SENAME or one of the approved adoption agencies must be present at the hearing, along with both prospective parents. The child is not normally present for the adoption hearing. It is extremely hard to obtain a duplicate certified copy of the adoption decree—it is highly recommended that parents ask for an extra certified copy while present at the hearing.

Once the adoption is approved, the judge will inform the civil registry and provide the information for a new birth certificate, with the adoptive parents’ names. This part of the process can take between 15-30 working days. The new birth document is used to obtain a Chilean identification card (also known as a R.U.T. number), which is required to obtain a Chilean passport. This part of the process can take between 15-30 working days as well. Typically adoptive parents will remain in Chile for one to two months to complete the adoption process.

Required Documents: The following documents are required by SENAME after the initial letter or email from the prospective adoptive parents is received. They will not accept these documents with the initial letter or email. Prospective parents will receive a letter from SENAME acknowledging receipt and asking for the following documents below. Once the package of documents is received, SENAME will begin the process of matching a child.

• Birth certificates and marriage certificate of the prospective adoptive parents;
• Certificate issued by a Chilean Consul in the U.S. that states that the parents have met all U.S. adoption requirements;
• Favorable home study conducted by an accredited agency in the U.S.;
• Physical and psychological exams demonstrating the well-being of the parents;
• Proof of parents’ financial situation, i.e., ability to successfully support the child;
• Recent photographs of each of the prospective adoptive parent(s);
• Three notarized letters of recommendation from U.S. community, religious or other governmental authorities.

Since all Immigrant Visas issued in Chile will be IR-3 visas, the U.S. Embassy will issue a certificate stating that the child is eligible for U.S. citizenship automatically after he/she legally enters the U.S. with an immigrant visa. In order to obtain this certificate, adopting parents and/or their agent must come to the Embassy Monday, Wednesday or Friday morning between 8:30-11:00am.

Embassy of Chile
1732 Massachusetts Avenue, N.W.
Washington, DC 20036
Tel: (202) 785-1746
Fax: (202) 887-5579
http://www.chile-usa.org

Chile also has consulates in Chicago, Houston, Los Angeles, Miami, New York, Philadelphia, San Francisco, and San Juan.

U.S. Immigration Requirements: Prospective adoptive parents are strongly encouraged to consult USCIS publication M-249, The Immigration of Adopted and Prospective Adoptive Children, as well as the Department of State publication, International Adoptions. Please see the International Adoption section of this book for more details and review current reports online at http://travel.state.gov/family.

Additional Information: Specific questions about adoption in Chile may be addressed to the U.S. Embassy in Santiago. General questions regarding international adoption may be addressed to the Office of Children's Issues, U.S. Department of State, CA/OCS/CI, SA-29, 4th Floor, 2201 C Street, NW, Washington, D.C. 20520-4818, toll-free Tel: 1-888-407-4747.