Business Environment Snapshot for Chile - Highlights

HighlightsRankingsQuantitative DataLegislationAnalytical WorkProject Portfolio

Region: Latin America & Caribbean
Income category: Upper middle income
Population: 16,594,596
GNI per capita (US$): 8350

Below are select highlights for the data included in the profile.

Chile ranks well above the regional and income group averages in all seven global rankings.
According to the World Economic Forum's Global Competitiveness Report for 2006-07, the three most problematic factors for doing business are restrictive labor regulations, inadequately educated workforce, and inefficient government bureaucracy.
The only subcategory - indicator? of Doing Business in which Chile ranks outside of the top 70 is Closing a Business, in which it ranks 98th. The primary reason is the number of years it takes to close a business, in which Chile ranks in the bottom 30% of countries.

View global rankings on the business environment. See the underlying scores, the trend indicator, and a radar chart with regional and income group comparisons.

View Comparison Chart

#	Indicator	Source	Rank			Scale	Score						Trend over past year¹
#	Indicator	Source	2008	2007	2006	Scale	2008	2007	2006	2005	2004	2003	Trend over past year¹
1	Business Environment Index	EIU - Global Outlook Report		19 (82)	20 (82)	1-10		7.8	7.6	7.6	7.5	7.4
2	Control of Corruption Indicator	World Bank Group	21 (201)	21 (201)	21 (200)	-2.5-2.5	1.4	1.3	1.4	1.4	1.2	1.5
3	Country Credit Rating	Institutional Investor	33 (174)	29 (174)	30 (173)	0-100	77.4	76.4	73.6	70.0	67.2	64.7
4	Index of Economic Freedom	The Heritage Foundation and the Wall Street Journal	8 (157)	8 (157)	8 (157)	0-100	79.8	79.0	79.3	79.1	76.9	76.0
5	Political Risk Rating (ICRG)	PRS Group	32 (140)	24 (140)	22 (140)	0-100	78.5	81.0	82.5	81.0	78.0	77.0
6	Doing Business Ranking	World Bank Group	40 (181)	36 (181)		1-181²
7	Quality of National Business Environment Ranking	World Economic Forum - Global Competitiveness Report		30 (127)	29 (111)	1-127²

View Comparison Chart

Notes:

Please Note: As each of these rankings is collected and published on a different schedule, we associate the data with the year it was published. For Doing Business, the data is also associated for the year it was published (not the year of the report). For example, the data for 2007 was published in 2007 (yet from the Doing Business 2008 report).

¹An up/down rating requires a change within the last 2 years with available data of at least 1%
²These two sources only provide rankings, not an underlying score. We do not report trends for these two, as trends on rankings cannot be compared with the trends on scores.

View more detailed data from Doing Business and the Enterprise Surveys, two flagship data products of the World Bank Group focusing on private sector development. View key economic and private sector development indicators.

Doing Business

Source: Doing Business Website

Ease of...	2008 rank	2007 rank	Change in rank
Doing Business	40	36	-4
Starting a Business	55	42	-13
Dealing with Construction Permits	62	60	-2
Employing Workers	74	73	-1
Registering Property	39	35	-4
Getting Credit	68	61	-7
Protecting Investors	38	33	-5
Paying Taxes	41	37	-4
Trading Across Borders	53	44	-9
Enforcing Contracts	65	66	1
Closing a Business	112	101	-11

Three Well Performing Indicators	Percentile Rank¹	Indicator Value²	Compare with Income Group Average	Compare with Region Average
Starting a Business: Paid in Min. Capital (% of GNI per capita)	99.4	0.0	53.0	22.6
Getting Credit: Public registry coverage (% adults)	93.9	28.1	13.2	17.6
Paying Taxes: Total tax rate (% profit)	88.4	25.9	45.0	48.9

Three Potential Indicators for Reform	Percentile Rank¹	Indicator Value²	Compare with Income Group Average	Compare with Region Average
Employing Workers: Firing costs (weeks of salary)	36.5	52.0	42.9	57.1
Paying Taxes: Time (hours)	30.4	316.0	271.7	397.8
Closing a Business: Time (years)	27.6	4.5	2.9	3.2

¹A percentile rank of 1 reflects a country ranked for that variable in the bottom 1 % of countries. Conversely, a percentile rank of 100 reflects a country ranked for that variable in the top 1% of countries.
²The value shown in this column is the specific value for the indicator. For example, if there is a value of 9.8 for Starting a Business: Duration (Days), that means that for the particular country it takes 9.8 days to Start a Business.

See Full Indicator List

Enterprise Surveys

Source: Enterprise Surveys Website

Top 10 Constraints to Firm Investment in Chile

Senior Management Time Spent in Dealing with Requirements of Government Regulation (%)

% of Firms Expected to Pay Informal Payment (to get things done)

% of Firms Using Banks to Finance Investments

% of Firms With ISO certification ownership (%)

Time spent in meetings with tax officials (days)

Average Time to Clear Direct Exports Through Customs (days)

Note: These graphs compare the relevant country to the best and worst countries within the region and the world.

Time Series Data

Source: WDI, ILO, S&P

	2002	2003	2004	2005	2006	2007
Macro Indicators
GDP growth (annual %)	2.2	3.9	6.0	5.6	4.3	5.1
Inflation, consumer prices (annual %)	2.5	2.8	1.1	3.1	3.4	4.4
Total Returns Index (IFCGTRUS)	5095.3	4576.5	8540.6	10504.9	13467.0
Financial & Private Sector Development Indicators
FDI Net Inflows , (% of GDP)	3.8	5.8	7.5	5.6	5.4
Gross Fixed Capital Formation, private sector (% of GDP)
Tax revenue (% of GDP)	16.8	16.3	17.0	18.7	20.6
Exports of goods and services (% of GDP)	34.0	36.5	40.7	41.3	45.2	47.6
Imports of goods and services (% of GDP)	31.6	32.4	31.6	32.7	30.7	33.6
Private Credit to GDP	69.9	71.4	71.0	62.4
Private Credit to Total Domestic Credit	0.9	0.9	0.9	1.0
Total Financial System Deposits to GDP	35.6	34.0	32.2	47.0
Bank nonperfoming loans to total (%)	1.8	1.6	1.2	0.9	0.9
Lending Spread	3.8	3.4	3.1	2.6
Private Sector Employment as a % of Total Employment	83.7
Business Entry Rate (new registrations as % of total)			16.6	16.8	17.4	18.2

Title	Author/Contact	Source	Date
Chile Doing Business profile		Doing Business database	09/08
Chile : a strategy to promote innovative small and medium enterprises	Goldberg, Mike and Eric Palladini	WPS 4518	02/08
Doing Business 2008 Chile : comparing regulation in 178 economies			06/07
Do workers in Chile choose informal employment? A dynamic analysis of sector choice	Packard, Truman G.	WPS 4232	05/07
Relying on expert panels to help settle regulatory disputes : lessons from Chilean experience	Jadresic, Alejandro, Lorenzo Bertolini	Gridlines. -- No. 22 (May 2007)	05/07
Chile - Country Partnership Strategy			04/07
Chile - Investment Climate Assessment (Vol. 1 of 2) : Executive summary and policy recommendations			04/07
Chile - Investment Climate Assessment (Vol. 2 of 2) : Background chapters			04/07
Contagion and firms' internationalization in Latin America : evidence from Mexico, Brazil, and Chile	Sakho, Yaye Seynabou	Policy Research Working Paper 4076	12/06
Access and risk - friends or foes? Lessons from Chile	Uribe, Myriam, Giovanni Majnoni, Osvaldo Adasme	WPS 4003	09/06
Chile - Development Policy Review			06/06
Access to finance by Chilean corporations	Sirtaine, Sophie	WPS 3845	02/06
Chile - Report on the Observance of Standards and Codes : insolvency and creditor rights systems			06/04
Chile - New economy study (Vol. 1 of 2) : Executive summary and policy recommendations			02/04
Chile - New economy study (Vol. 2 of 2) : Background documents			02/04
Chile - Report on the Observance of Standards and Codes (ROSC) : corporate governance country assessment			05/03
Chile : accelerating e-business for small business innovation and growth	James Hanna	En breve. -- No. 21 (March 2003)	03/03

Project	Total Project Amount (US $ millions)	Contact
World Bank
No Data
IFC
No Data

Notes:

Doing Business

Enterprise Surveys

Time Series Data

Banking and Credit Laws (Getting Credit, Protecting Investors)

Bankruptcy and Collateral Laws (Closing a Business, Getting Credit - Legal Rights)

Civil Codes (Starting a Business, Registering Property)

Civil Procedure Codes (Enforcing Contracts, Closing a Business, Protecting Investors)

Commercial and Company Laws (Starting a Business, Protecting Investors, Closing a Business)

Constitutions (Starting a Business, Employing Workers, Registering Property, Enforcing Contracts)

Labor Laws (Employing Workers)

Privacy Laws (Getting Credit - Private/Public Credit Bureaus)

Securities Laws (Protecting Investors)

Tax Laws (Paying Taxes)