Chile forges closer economic relations with China. Chile's ambassador to China, Jorge Heine, expects Santiago to become the regional platform for the RMB in Latin America, following Premier Li Keqiang's visit and the currency swap agreement, signed on May 24-25.

"What Premier Li brought was the proposal that Chile becomes effectively the regional platform for the RMB in Latin America. That is obviously very significant for us, we for a long time wanted to make Santiago a financial hub of Latin America," he said.

The agreement was signed between the Ministry of Public Works of Chile and the China Development Bank. China Development Bank will be informed of all projects initiated from the Ministry, so that it can provide information to prospective bidders in China.

"Chile has a highly sophisticated PPP system of concessions, whereby infrastructure projects like roads, tunnels, bridges, ports and airports are built this way. The government is keen to have Chinese companies participate in it," added Heine.

China Construction Bank Corp (CCB), the country's second biggest lender, is set to start operations in Chile to facilitate the use of RMB in Chile. A memorandum of understanding has been signed. Chile is expecting CCB to start operations in few months and become the clearing bank for all RMB transactions in Latin America.

"CCB will be able to provide loans and credits to Chilean companies and Chinese companies that want to invest in Chile, so the second step is to increase the financial inflows to Chile and to the rest of Latin America," said Ambassador Heine.

The investment will be restricted to qualified institutional investors, such as banks, hedge funds, and insurance companies. "Chile is the first country to begin this access to the Chinese mainland financial market. This package allows a very significant step forward in financial cooperation between Chile and China," said Ambassador Heine.

Transferring Chinese copper refined capacity to Chile

Chile is looking forward to transferring Chinese copper refining capacity to Chile.

"Until now we largely exported copper concentrate which is the most basic form. We would like to add more value to our copper exports to China and to expand in the mining sector," said Ambassador Heine.

Chile has 28% of the world's total copper reserves and is the main producer and exporter of copper in the world. At the same time, China accounts for about 40% of total world copper consumption in any given year. Chile's exports to China amounted to18.8 bn USD, of those about 78%, 14.6 bn, are copper related.

"Copper is very much at the heart of our relationship", said Ambassador Heine, adding that China is looking now in so called "new norm", emphasizing light industries and services and moving away from heavy industries. "I think we can work together in joint ventures, and transferring its refined capacity that is now in China to Chile."

"But we can work together with our Chinese friends in bringing some of this technology to Chile and perhaps some joint ventures. We have a big desert; we don't have same constraints that this industry faces in some parts of China. I think it's pretty much a win-win proposition." Ambassador Heine adds that the technology transfer would bring Chinese professionals and engineers to Chile.

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