Chile National and Foreign Trade
Internal trade. – The prosperity of the mines, metallurgical workshops and nitrate producing areas has completely renewed the economic life of the town thanks to the association established between the nitrate producing provinces and those with agricultural and pastoral production that feed them. In addition to absorbing the overabundant labor force of central Chile, northern Chile consumes its flours, wines, livestock and fodder. The land of wheat and vineyards thus collects a part of the export value of copper and nitrate.
According to indexdotcom, the statistics of Chilean cabotage allow us to get an idea of the importance of this internal traffic current. The northern ports from Pisagua to Taltal received from central Chile in 1922 (the year of reduced activity of the nitrate industry) 14 million kylene plates of flour, 7 million plates of grain, 14 million plates of cattle, 7 million plates of fruit and legumes, 5 million plates of fodder. In the same year, Valparaiso sent 30 million kylene plates of the same products to the nitrate region and Talcahuano sent 17 million plates of flour to the ports of the desert area in the same year. The relations of central Chile with Magellania do not have the same importance as those with the provinces of the north, but they are nevertheless of the same species. Punta Arenas, which annually exports its wools abroad, receives flours, fruit and legumes from central Chile, and sends back rams and meat for slaughter. Almost all of these internal exchanges are carried out, as we shall see, by sea. The trade in cabotage reached a movement worth $ 567 million in 1925. The total capital employed in the Chilean commercial enterprises reaches 737 million pounds.
Foreign trade. – The Chilean trade balance as a whole is in excellent condition. In fact, alongside an average annual value of 1144 million pesos for imports, for the period 1923-28, there are exports with 1772 million. The balance shows up in every active year.
Chylene exports perfectly reflect the country’s economic equipment, described in the previous pages: in fact, as a value, the fundamental items are nitrates and copper, which alone account for 80% of the total value. Agricultural and animal products (wheat flour, wheat, wood, wool, livestock) come from a great distance. With regard to wheat there is a constant, progressive decrease: while in the second half of the century XIX in some years, exports exceeded a million quintals, down to 580,000 in 1913, to 218,000 in 1926, to 117,000 in 1929; in 1927 there was a surplus of imports over exports.
Imports mainly concern textile and metallurgical products which alone take up almost half of the total value; followed by food products (coffee, sugar), fuels (oil, coal and derivatives), chemicals, etc.
The countries that have the greatest trade relations with Chile are the United States, Great Britain, Germany and France, to which must be added Italy, Belgium, Peru and Argentina.
In this regard, it should be noted that the Great World War brought about profound changes in the percentage distribution of suppliers and customers in Chile. In fact, while before the war Great Britain and Germany occupied 60% of chylene exports and 58% of imports in Chile, after the war the dominance is held by the United States with over 40% of total Chylene exports and beyond. 25% for imports: Great Britain follows; Germany accuses the most serious decrease falling between 20% and 10% for exports, between 26% and 16% for imports. Before the war it was the largest importer of Chilean nitrate (about ⅓ of the total) and at the same time it supplied Chile with huge quantities of chemical and metallurgical products. World war paralyzed traffic, which, however, is recovering, favored by the reborn industrial organization, by the presence in Chile of the German colonies, which are the most influential of those of the republic. There is a very strong decline in nitrate, as Germany currently uses synthetic chemicals on a large scale.
The enormous development of trade relations between Chile and the United States given by the outbreak of the world war and the opening of the Panama Canal, which enormously shortened relations between the American Pacific coast and that of the North Atlantic to the detriment of the industrial nations Europeans, who inevitably find themselves in a state of inferiority. Secondly, there was a progressive investment of American capital in the vast Chilean economic activities, going from 25 million dollars in 1908 to almost half a billion, especially in the mines, with over 50% of the capital invested. The United States is the main customers for nitrate, copper and iron ores, while it sends metallurgical products, machines, automobiles, oil, etc. to Chile.
The second most important country in economic relations is Great Britain, which has long since penetrated the most sensitive gangs of Chilean economic life: loans to the government and municipalities, capital invested in railways, mines for a total value of several billion lire..
Commercial relations with Italy amounted on average, in the period 1925-1928, to 281.7 million lire per year (187.2 million for imports into Italy, 94.5 million for exports; 1928 furorio of 218.7 and 72.7 million respectively); we import nitrates and copper in ingots, exporting textiles, rice, olive oil, motor vehicles, machinery, chemicals, etc.