External factors condition Chile's economic outlook

Significance

This year, Chile will face a complex mix of external factors as it seeks to reverse last year's deceleration of GDP growth. Conflicting effects on areas that include not only the trade balance but also investment, inflation and fiscal revenues make forecasts for the economy's performance this year more than usually uncertain.

Impacts

• Industry estimates suggest that up to half of Chile's 1,000 small copper mines could be forced to close.
• Because some Chilean power plants use diesel, international oil prices will have an important spin-off effect on electricity prices.
• In coming months, local growth forecasts will be particularly sensitive to news from overseas -- especially China.