Chile Economic Forecast

Chile has long had an economy based primarily on the market, which means significant foreign imports and exports, as well as a reputation for having a sound economic policy and strong financial institutions. With this, the country has gained popularity for being one of the best in South American for trade. In fact, the export business of Chile accounts for about 40% of the Gross Domestic Product or GDP and for the remainder, the country relies on commodities. For the government’s revenue, copper alone provides approximately 35% of revenue.

Chile has long had an economy based primarily on the market, which means significant foreign imports and exports, as well as a reputation for having a sound economic policy and strong financial institutions. With this, the country has gained popularity for being one of the best in South American for trade. In fact, the export business of Chile accounts for about 40% of the Gross Domestic Product or GDP and for the remainder, the country relies on commodities. For the government’s revenue, copper alone provides approximately 35% of revenue. When it comes to economic reform, Chile has become an incredible role model as the country has become strong and viable due to Patricio AYLYIN that took the military over in 1990. From 1991 to 1997, the GDP experienced an 8% growth on average but then a decline was seen in 1998. By 1999, Chile was devastated by a major drought, which cut crop yield down and left a shortage of hydroelectric and electric power. However, because surpluses in sovereign wealth investment are accumulated during times when copper prices are high and the economy is growing, Chile has been able to maintain a solid economy.

Chile GDP Forecast

Without doubt, the Gross Domestic Product for Chile is solid because of high volumes of foreign trade, along with the government’s outstanding economic policy. Having a free trade agreement with the United States, trade policies have been liberalized over the years. Although the country experienced some economic struggles in the late 1990s because of a severe drought, Chile bounced back quickly. For instance, in 2008, the Chile GDP (Gross Domestic Product, Current Prices, US Dollar) was at $170.80 billion in US dollars and by the end of 2009, a decrease of 5.28% was seen closing out the year at $161.781 billion. Using specific data and trend analysis, forecasters expect that that GDP for 2010 will end at $196.45 billion in US dollars, which is an increase of 21.43% over the previous year. By 2015, forecasters expect the GDP to hit $282.053 billion.

Chile Unemployment Forecast

Currently, Chile population is around 17 million and of those, just slightly more than 50% are working. The primary sector for employment is services, followed by industry and agriculture. For 2008, the Chile unemployment rate was relatively low at 7.7% but in 2009, numbers rose to a little over 10%. Experts estimate that approximately 18.25% of Chile’s population lives below the poverty line but with a strong economy and the government working hard to create new opportunities, the numbers are expected to improve.

Chile Inflation Rate Forecast

For the Chile Inflation Rate, forecasters use data consisting of averages for the given year rather than data from end-of period. In 2008, inflation for the country was around 8.72% regarding change for average consumer pricing. From the end of 2008 to the end of 2009, a reduction of 80.73% occurred, putting 2009 at 1.68%. With that, Chile was positioned at number 124 for world rankings. Then for the 2010 forecast, an increase of 16.13% is expected, which would close the year out at 1.95%. Going out another five years to 2015 places the inflation rate forecast at 3%.

Chile Current Account Balance Forecast

As far as the Chile Current Account Balance, we know that in 2008, the country was at a negative $2.52 billion in US dollars but by the close of 2009, numbers had changed to $3.506 billion, which was a reduction of 239.02%. This change put the country at number 29 for world rankings. Using all transaction data except financial and capital items, the balance forecast for 2010 is forecasted at a negative $1.56 billion and by 2015, a negative $8.019 billion in US dollars.