The Chilean economy will expand at a sluggish pace in the coming quarters, as weaker growth in China and deteriorating business confidence weigh on fixed investment. In addition, falling consumer confidence indicates tepid household spending is ahead. A weakening economy will hurt the ruling Nueva Mayoría (NM) coalition’s popularity, prompting the Chilean government to shelve its social agenda in favour of pro-growth policies.
With the NM likely to backtrack on education reform, there is a rising probability that Chile’s student protest movement will reignite in the months ahead. Chile’s external account rebalancing will continue in the coming years, with a weaker exchange rate bolstering the country’s good trade dynamics. This will see the current account deficit shrink to 1.9% of GDP in 2014 and 1.2% in 2015, from 3.4% of GDP in 2013.
Major Forecast Changes
We have revised down our 2014 real GDP growth forecast from 2.5% to 2.0%, and our 2015 forecast from 3.2% to 2.6%, implying a more substantial drop-off from 4.1% growth in 2013. We revised down our 2014 average exchange rate forecast from CLP562.0/USD to CLP573.9/USD, expecting the peso to average CLP613.7/USD through the remainder of 2014, compared to the current spot price of CLP598.5/USD.
The Chile Business Forecast Report helps businesses with market assessment, strategic planning and decision making to promote growth and profitability in Chile and is an essential tool for CEOs, Chairmen, Finance Directors/CFOs, Managing Directors, Marketing/Sales Directors with commercial interests in this emerging market.
An influential new analysis of Chile’s economic, political and financial prospects through end-2018, just published by award-winning forecasters.
- Forecast the pace and stability of Chile’s economic and industry growth through end-2018.
- Identify and evaluate adverse political and economic trends, to facilitate risk mitigation.
- Assess the critical shortcomings of the business environment that pose hidden barriers and costs to corporate profitability.
- Contextualise Chile’s country risks against regional peers using Publisher’s country comparative Risk Rankings system.
- Evaluate external threats to doing business in Chile, including currency volatility, the commodity price boom and protectionist policies.
- The Chile Business Forecast Report by Publisher includes four major sections: Economic Outlook, Political Outlook, Business Environment and Key Sector Outlook.
How will the Chile economic policy-making and performance impact on corporate profitability over 2014-2018?
Publisher provides our fully independent 5-year forecasts for Chile through end-2018 for more than 50 economic and key industry indicators. We evaluate growth, and also forecast the impact of economic management.
Economic Outlook Contents
The Chile Business Forecast Report features Publisher’s forecasts with supporting analysis for 2014 through to end-2018, set against government views and Publisher’s evaluation of global and regional prospects.
Key Areas Covered:
Full 10-year forecasts with data – for key macroeconomic variables including GDP (real growth and per capita), population, inflation, current account balance and the exchange rate.
Publisher’s comprehensive Risk Rankings system – rates each country worldwide for economic and political risk, and rates the business environment, within a global and regional context.
- Economic Activity – real GDP growth, employment, inflation, consumption (retail sales and confidence).
- Balance of Payments – trade and investment, current and capital account.
- Monetary Policy – interest rate trends (bank lending and deposit rates) and inflation (producer price and consumer price).
- Exchange Rate Policy – currency controls, foreign investment flows, exchange rates and foreign exchange reserves.
- Fiscal Policy – macroeconomic strategy and policies, government finance and tax reforms.
- Foreign Direct Investment – approvals, inflows and climate.
- External Debt – debt profile (short and long-term plus public and private sector exposure).
- Global Assumptions – forecasts for each year to end-2018 covering: major commodities, growth in key regions, inflation, and interest and exchange rates, in the United States, Japan, China and the eurozone.
- Rely upon Publisher’s 100% independent forecast scenarios for Chile and underlying assumptions – we take no advertising and are privately-owned.
- Exploit the benefits of Publisher’s comprehensive and reliable macroeconomic database on Chile, sourced and fully maintained by Publisher from an extensive network of private sector, government and multilateral contacts.
- Gain key insights into the current and future direction of government economic policy, which could significantly affect your company’s business prospects, from Publisher’s team of analysts and economists.
What are the political risks to doing business in Chile over the next 5-years?
Publisher’s Chile country Risk Rankings evaluate the short- and medium-term threats to political stability.
Political Outlook Contents
- SWOT Analysis for the Chile Market – Political Strengths, Weaknesses, Opportunities and Threats facing Chile.
- Political Stability and Risk Assessment – Publisher’s Risk Rankings assess explicit short- and long-term risks to political stability; latest ankings, rankings and trends for Chile’s risk are compared with regional and global averages.
- Current Administration and Policy-making Publisher assesses the threats to the continuity of economic policy, and likely changes to the business operating environment.
- Benchmark Chile’s risk profile against its neighbours, the global and regional average, allowing easy comparison of risks between key business markets.
- Identify, evaluate and anticipate political and security risks to the business environment, and to your company’s current operations and future plans.
- Gain valuable insights into government and policy-making, through Publisher’s specialist team of analysts and economists, and their network of private and public sector sources.
- Business Environment
- Business Environment Risk Rankings with SWOT Analysis – Business Environment Risk Rankings for Chile, benchmarked against rankings for regional neighbours.
- Country Competitiveness – Competitiveness of Chile’s business operating environment in supporting corporate growth and profitability, compared with regional neighbours.
Business Environment Contents
- Domestic Environment – Transparency, cronyism and corruption; labour market flexibility; corporate tax burden; interest rate levels; sophistication of banking sector and stock market; levels of business confidence; infrastructure and IT.
- Foreign Direct Investment – Analysis of foreign investment regime; foreign ownership laws; attractiveness of business environment to foreign investors.
- Foreign Trade – Analysis of trading environment, government trade policy, liberalisation measures, tariffs and membership of trade areas.
- Assess your company’s evolving exposure to country specific operational and business risks, using Publisher’s in-depth analysis of the legal and regulatory business environment.
- Understand your market’s comparative strengths and weaknesses in the key areas of commercial infrastructure and business institutions, using Publisher’s proprietary global Business Environment Risk Rankings.
Key Sector Outlook
- Which industry sectors in Chile will grow fastest, and where are the major investment opportunities in the market?
- Publisher’s identifies investment opportunities in Chile’s high growth industries including automotives, defence & security, food & drink, freight transport, infrastructure, oil & gas, pharmaceuticals & healthcare and telecommunications & IT.
Key Areas Covered:
- Market Overview – Size and value of each industry with developments over 2009-2013, covering major industry key performance indicators (KPIs) that have impacted company performance.
- 5-year Industry Forecasts – Forecasts for each year over 2014-2018, using Publisher’s proprietary industry modeling technique, which incorporates all key domestic and international indicators – including economic growth, interest rates, exchange rate outlook, commodity prices and demographic trends – to provide fully integrated forecasts across, and within, each industry.
- Demand- and Supply-Side Data/Forecasts – Publisher’s industry data covers both the output of each industry and the domestic demand, offering clear analysis of anticipated import/export trends, as well as capacity growth within each industry.
Target strategic opportunities in high growth industries, which are benefiting from global mega trends, and thus offer strong investment and growth opportunities.
Compare the growth path of different industries to identify which are best placed to benefit from domestic and international economic prospects, and which have historically suffered from volatile growth trends – a key indicator of future risks.
Spanning over 53 pages, “Chile Business Forecast Report Q1 2015” report covering the Executive Summary, Political Outlook, Long-Term Political Outlook, Economic Outlook, Fiscal Policy, Monetary Policy, Balance Of Payments, Exchange Rate Policy, 10-Year Forecast, Operational Risk, Key Sectors
Know more about this report at – http://mrr.cm/Zrt
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