U.S.-Chile Free
Trade Agreement
A Partnership For Prosperity
2008
U.S. Exports to Chile of
US$ 12.1 billion are now
21% of Chile’s Imports
2003
U.S. Exports to Chile of
US$ 2.7 billion are 15%
of Chile’s Imports
345%
Growth
21%
15%
In the 5 years since the FTA became effective:
1
(on January 1, 2004) :
U.S. Exports to Chile rose from $2.7 billion to $12.1 billion ➔ 4.5x or
345% growth, far exceeding the 18 – 52% growth originally projected
by the U.S. International Trade Commission over the first 12 years of the
FTA
In 2008, the U.S. had its first trade surplus with Chile since 2000
The U.S. is Chile’s No. 1 trading partner
In 2006, over 10,000 U.S. companies exported to Chile
2
The FTA has mutually benefited both countries ➔ Chile’s exports to the
U.S. have grown 121% or 2.3x (since 2003).
The U.S. is the Nº 5 destination of Chilean Foreign Direct Investment
1
Unless otherwise stated, the source for U.S. figures is the U.S. Census Bureau and the Chile Central Bank for Chile figures.
International Trade Administration, Office of Trade and Industry Information.
3
General Directorate of International Economic Affairs.
2
3
Total Bilateral Trade U.S. – Chile 2003 to 2008
20.000 US$ Billion
20.283
17.314
16.351
16.000
12.000
11.887
U.S. imports from Chile
U.S. exports to Chile
Total bilateral trade
Bilateral trade balance
(U.S perspective)
8.338
8.000
6.420
4.000
0
-4.000
2003
2004
2005
2006
2007
2008
Source: U.S. Census Bureau
U.S. – Chile Export Sector Growth
(%) Growth of US Exports to Chile 2003 to 2008
296%
Rubber
Plastic
311%
Cereals
348%
Organic Chemicals
353%
Fertilizers
354%
Motor Vehicles
362%
689%
Steel
Aircraft, Spacecraft
2,246%
5,658%
Mineral Fuel, Oil Etc
0
1,000%
2,000%
3,000%
Source: U.S. Census Bureau
4,000%
5,000%
6,000%
Company Testimonials
Lion Apparel
Sioux Corporation
Westrock
Bisonte Industrial
Lion Apparel is a 110 year-old family owned company based in Dayton, Ohio
that designs and manufactures apparel for emergency responders. In 2007, Lion
Apparel won a three-year contract to supply 6,000 firefighting suits to Chile’s allvolunteer national firefighters. Each firefighting suit contains a barcode label that
allows the department to track and identify the use and repair history of each suit.
Proper maintenance of the gear assures that each and every suit is safe and fit for
duty. The fabrics layers of the gear are engineered to manage moisture so that the
gear stays lighter weight, dries faster, and reduces the risk of scald burns. This
technology, called “isodri” was invented and patented by Lion Apparel. According
to Lion’s local partner, Codigo 33, this is the first time that Chilean firefighters have
had such high technology suits.
Sioux Corporation is a small, family owned manufacturing company based in
Beresford, South Dakota. Sioux Corporation’s products include decontamination
equipment, steam cleaners, pressure washers, and industrial water heaters. In 2008,
Sioux Corporation was looking to expand its international operations and decided
to focus on Chile, largely because of the Free Trade AgreementIn mid-2008,
representatives from Sioux Corporation traveled to Chile to find a distributor, and
by late 2008 they had already sold two pieces of large equipment. The equipment
faces no tariffs upon entering the Chilean market, saving the customer money and
making Sioux’s products more competitive in the Chilean market.
Chile’s robust mining sector accounts for 6.6% of GDP (2008), and the United
States is the single largest equipment supplier to this sector. Westrock is a small
manufacturing company, with 20 employees, based in Little Rock, Arkansas.
Westrock makes friction discs and steel reaction plates for industrial, off road
equipment, earthmoving machinery brakes, and other specialty parts. In 2007,
a Chilean industrial distributor contacted Westrock after seeing the company’s
products at a trade show. Westrock now has a contract to supply brake components
for mining equipment in Chile, and all of these products enter Chile duty-free.
The duty-free status afforded to U.S. exports through the U.S.-Chile FTA helps
U.S. firms offer their products to Chilean customers at more competitive prices.
Bisonte Industrial is a family-owned Chilean company and one of Chile’s oldest
and largest manufacturing companies of uniforms and work-related clothing.
After being negatively impacted by a wave of Asian imports to Chile, Bisonte
traveled to the U.S. in late-2006 to form new business relationships and signed
on two new suppliers - Rothco, and Propper International, Inc. Rothco is based
in Ronkonkoma, New York, and now supplies Bisonte with non-combat military
products. Propper International Inc, of St. Charles Missouri now sells camouflaged
fabric for Bisonte to manufacture uniforms for the Chilean armed forces. These
products all became duty-free with the U.S.-Chile Free Trade Agreement.
Chile Summary
Human Development
*Source: United Nations
Development Project, Human
Development Index 2008
**Source: Ministry of Labor
Population: 16.7 million
Literacy Rate*: 96.4%
Life Expectancy*: 78.4 years
School Enrollment*: 82.5%
Labor Standards: Adoption of
ILO Declaration on Fundamental
Principles and Rights at Work**
Unemployment Rate: 7.74%
(2008)
Economic Development
*Source: International
Monetary Fund 2008
**Source: U.S.Census Bureau
GDP (2008): CLP$ 64.7 trillion
(approx. US$ 123.9 billion)
GDP Growth: 3.2%
(2008 Annual Var.)
GDP (2007)
(PPP) per capita: US$ 14,688*
Total Chile Trade Growth
(2008 Annual Var.): 12%
Total Bilateral Trade Growth
(2008 Annual Var.)**: 17%
(www.trade.gov and www.amchamchile.cl)