Just over six years ago, a “state of the art” free trade agreement (FTA) was signed between the United States and Chile. Since that time, a nearly perfect model of bilateral trade has ensued. In fact, the projected growth between the two countries was between 18% and 52%. Would you believe that the actual growth over this period is over 345%?! Free trade agreements have often been a source of debate because of the potential environmental and human rights impacts they have had in the past. How has this FTA impacted each country?
This free trade agreement put into place some unique arrangements which have facilitated the significant gains in trade. One of the most notable advancements is the professional work visa extended to Chilean businesspeople seeking temporary permission to work and live in the United States. This visa permits Chileans the opportunity to stay in the United States for up to 18 months and forego the usual red tape associated with non-work visas.
What sectors have benefitted the most from this agreement? By far the sectors that have grown the most (from a US export perspective) are mineral fuel, aircraft, and steel. The growth rates, over the last 5 years, range anywhere from 689% growth (steel) to 5,698% growth (mineral fuel). From a Chilean perspective, the United States became the number one trading partner. Additionally, Chile’s exports to the U.S. have grown 121%!
A short video segment shot by the United States Commercial Service discusses the business climate in Chile, current and future benefits of the FTA, and next steps for a small to medium-sized business to enter the market. Check it out!