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WEEKLY NEWSLETTER
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Chile
Index
The Chilean manufacturing sector experienced strong
performance
in the 1985-91 period, and the Industrial Development
Association
(Sociedad de Fomento Fabril--Sofofa) expected a 7 percent
to 10
percent increase in industrial output in 1992. (The sector
actually
grew 12.3 percent during the first three quarters.)
Between 1985
and 1991, the manufacturing sector grew at an average
annual rate
of 6.2 percent, a figure that compared favorably with the
average
rate for the 1960s of 5.1 percent per annum. However, in
spite of
the dynamic behavior of manufacturing as a whole, the
development
of different industries within the sector was uneven. Some
industries were able to exploit Chile's comparative
advantages,
expanding at a rapid pace. In many cases, this expansion
was the
result of the development of new international markets and
of
rapidly growing exports. Other industries, however, were
victims of
drops in relative prices, caused either by trade
liberalization or
by loss of international buyers, and were forced to reduce
their
scope of operations.
The major industries of the Chilean economy in the late
1980s
and early 1990s were agriculture and food products,
textiles and
clothing, nonelectrical machinery, transportation
equipment, and
industrial chemicals. As noted previously, the performance
of
individual industries was uneven (see
table 21, Appendix).
Although
foodstuffs, furniture, and glass products experienced
strong
expansion, other industries had a lower level of output in
1991
than in 1979.
For decades, wine has been one of Chile's best-known
products,
and wineries were expected to experience double-digit
growth in the
1990s. Exports of wine increased during the 1970s,
primarily to the
United States, reaching US$31.9 million in 1989. Total
wine exports
in 1992 were estimated at US$127 million. By that year,
Chile had
become the third largest exporter of wine to the United
States,
behind Italy and France.
Not surprisingly, those sectors that had shrunk since
the early
1980s, such as footwear and transportation equipment, were
those
that had been hardest hit by increased foreign
competition.
However, the firms that finally survived in these sectors
did so by
adapting to the new external circumstances and by finding
ways to
rapidly increase productivity. In 1992 the transportation
equipment
sector was the most dynamic of all, increasing output at
an annual
rate of 46 percent.
Data as of March 1994
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