LatinNews Daily - 13 September 2022

In brief: Chile’s gov’t unveils major plan to boost investment

*Chile’s leftist government led by President Gabriel Boric has unveiled a major new strategy comprising six lines of action and 28 measures, which seeks to boost investment by five percentage points over the next year. These six lines of action are: 1) fiscal stimulation for private investment through tax benefits such as a US$500m tax credit fund for green businesses with a “high multiplying effect,”, an extension of a reduced tax rate for small and medium-size firms (SMEs) and plans to exempt copper mining projects for five years from an ad-valorem component proposed in a new mining royalty, among other things. Other lines of action include: 2) improvements in access to finance; 3) improvements in public investment; 4) promotion of foreign investment, with plans to reopen foreign investment offices in Europe and North America in Q4 2022 which the government hopes will permit the materialisation of projects worth over US$1.5bn in 2023; 5) improvements in the efficiency of regulatory procedure and permits; and 6) public-private partnerships for investment, with plans to set up working groups in sectors such as construction, energy, transport and mining. In its latest monetary policy report (IPoM) released this month, Chile’s central bank (BCCh) said that it expects investment to drop 3.3% this year (up from its June forecast of -4.8%) and to drop by 4.7% in 2023, compared with its June forecast of -2.2%.

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