A newly released market analysis by Chile’s Production and Trade Confederation (CPC) predicts that Chile’s economy will grow by 5.5 percent in 2006. The report highlights internal demand as the continued driving force behind Chile’s economic expansion.
Strong gains are expected in the banking sector with a predicted growth rate of 13 percent in 2006. The construction industry is also expecting another boom year with the Chilean Chamber of Construction planning to increase investments in infrastructure by eight percent, slightly less than 2005, but private construction companies predict a 14 percent overall increase because of investments in production capacity over the last year.
The pulp and paper industry is also expected to increase its production capacity this year. The Chilean Wood Corporation (CORMA) estimates that cellulose, milled wood, lumber, and newspaper production will increase capacity by 10 percent, representing an 8.3 percent profit increase over 2005.
Mining should continue to boost Chile’s economy. The continued high price of copper, estimated at an average annual rate of US$1.65 to US$1.75 for 2006, as well as increases in production capacity, and the opening of new mining deposits has Chile’s National Mining Society (SONAMI) optimistic about the future. Chile expects to mine approximately 31.3 percent of the total world copper output this year which should translate into a five percent overall growth rate.