Economic and political uncertainty have been the main market challenges for Chile in 2023, as companies and consumers have continued to be cautious with spending. The Boric Administration’s proposed reforms and proposed legislative changes in sectors such as mining, water, and indigenous rights, as well as energy prices and corporate taxes, have prompted companies across several industries to postpone some major investments and modernization plans in the near term. Although government procurements initially slowed after the Boric Administration came onboard in March 2022, the pace of tenders has increased, though the procurement process remains quite slow.

In terms of market entry, one of the biggest challenges to U.S. firms seeking to export to Chile is the high degree of competition and relatively small market size. With a population of just under 20 million, Chile’s open trade and investment policies have attracted the attention of many foreign firms, and it ranks as the 20th largest U.S. goods export market in the world. At the same time, the small market size has led some companies to overlook Chile, leaving interesting niche markets and solid opportunities for U.S. exports.

Despite Chile’s openness to new products and technology, Chilean businesspeople tend to be far more conservative and cautious than the average U.S. businessperson. U.S. companies should take this into consideration when entering the market and adjust sales expectations accordingly. While the Chilean Government is committed to streamlining certain processes, U.S. companies will find that operating in Chile requires patience and a tolerance for delays associated with government-mandated paperwork and obtaining various approvals and permits.

A key to competing successfully is finding the right in-country partner. It is extremely difficult for a foreign entity to successfully do business in Chile without having either a direct presence in the market or a local partner. A good agent or distributor can use business and/or social connections to open doors and overcome regulatory, as well as cultural and language barriers.