2014 Santiago Blog: Panel – The New Chilean Agenda on Growth and Social Change: A Private Sector Perspective

By
David Gacs

Private-sector leaders shared their views on what's next for Chile's economy.

Speakers:

  • Carlos Barrera, Vice President and Managing Director, SunEdison Latin America
  • Víctor Hassi Sabal, General Country Manager, MetLife Chile Seguros de Vida S.A and Chairman, ProVida AFP
  • Cristián Maturana, General Director and Founder, Portalinmobiliario.com
  • Nicolás Paut Vicuña, Economy Editor, CNN Chile (moderator)

CNN Chile's Nicolás Paut Vicuña asked the panelists how they believe the private sector sees the government’s reforms, as well as how the economic slowdown will effect business.

Metlife’s Víctor Hassi Sabal said Chile’s private sector needs to face not only lower global economic growth, but also the new tax regime coming into play. Business will have to wait and see how government reforms play out in the long term, he explained.

Cristián Maturana of Portalinmobiliario.com said that not only does the real estate sector have to see how the economic scenario will change for the industry, but also how it will effect the consumer. There’s been a big increase in housing prices since 2011, said Maturana, but the market remained healthy as people continued renting and buying. This has now slowed down since around the second quarter of 2013. Looking at the figures available, there is a bigger proportion of investors buying properties, foreshadowing what may continue to happen to the market, he noted. The tax reform could lead to prices rising between 5 and 13 percent, he added.

SunEdison Latin America’s Carlos Barrera said he believes at a macro level, it's unclear how the markets will react, but right now international markets look promising.

Recently, SunEdison launched a large solar project in Chile, and Barrera believes it’s an example of how energy projects can work harmoniously with local communities. Furthermore, Chile’s renewable energy projects are excellent for three reasons. First, the Atacama Desert receives a lot of sun, but also experiences low temperatures for such an arid region. This allows for very cheap generation of energy, less expensive than gas or coal. Second, Chile’s political scenario compared to other Latin American countries is very stable and allows for long-term financing and lowered development costs.

Finally, the country has 18 gigawatts of installed capacity, and needs to develop and additional 500 megawatts per year to continue growing. Because of this, there’s a lot of interest from private sector investors, allowing for a broad and diversified energy sector to come into play.

Watch a video of the panel: