Updated April 19, 2022
Chile: An Overview
Chile, located along the Pacific coast of South America,
democracy functions in their country in nearly every
traditionally has been one of the United States’ closest
Latinobarómetro poll conducted since 1995.
partners in Latin America. The country’s transition to a
higher level of economic development has enabled it to
Social Unrest and Constitutional Reform
play a more active role in foreign affairs, often in
As the political system has proven unwilling or unable to
collaboration with the United States.
channel citizens’ preferences, Chileans have taken to the
streets in mass mobilizations. Social unrest spiraled into
Figure 1. Chile at a Glance
violence in October 2019, when protests against an increase
in transit fares in Santiago were accompanied by vandalism,
arson, and looting. President Piñera’s decision to declare a
state of emergency and deploy the military to enforce a
curfew appears to have triggered public backlash, leading
millions of Chileans across the country to join the protests.
In an effort to restore peace and respond to demands for a
new social contract, the Piñera administration and
legislators from across the political spectrum agreed to hold
a plebiscite on whether to replace the Pinochet-era
constitution. The plebiscite passed with the support of 78%
of voters, and in May 2021, Chileans elected a
constitutional convention in which predominantly left-
Sources: CRS Graphics; Instituto Nacional de Estadísticas;
leaning independents hold a plurality of seats. The
Latinobarómetro; International Monetary Fund; Trade Data Monitor;
convention may seek to increase the state’s role in social
and Ministerio de Desarrollo Social y Familia.
service provision, reduce private control over water and
other natural resources, grant autonomy to Indigenous
Political and Economic Situation
peoples, modify the legislative and executive branches, and
Chile has a long democratic tradition but experienced 17
decentralize governance, among other changes. Each
years of authoritarian rule after a 1973 military coup led by
element of the constitution requires the approval of a two-
General Augusto Pinochet deposed the democratically
thirds majority of the convention. The convention has until
elected Socialist government of President Salvador Allende
July 2022 to produce a final draft, which is to be submitted
(1970-1973). More than 3,200 people were killed or
to a national referendum for ratification in September.
“disappeared” and some 38,000 people were imprisoned
and/or tortured during the Pinochet dictatorship. Chile
Boric Administration
restored democracy in 1990, following a 1988 plebiscite.
Gabriel Boric, a 36-year-old former legislator and student
leader, was inaugurated to a four-year presidential term in
Center-left and center-right coalitions dominated Chilean
March 2022. Leading the left-wing Apruebo Dignidad
politics for three decades following the transition. Center-
coalition, he defeated right-wing populist José Antonio Kast
left coalitions held the presidency and majorities in Chile’s
with 56% of the vote in a December 2021 runoff election.
bicameral congress for most of that period, but Sebastián
Boric’s campaign platform reflected many of the demands
Piñera led his center-right coalition to power for two
articulated by protesters in 2019. Among other changes,
nonconsecutive presidential terms (2010-2014, 2018-2022).
Boric has pledged to usher in a new era of economic and
Both coalitions largely maintained the market-oriented
social inclusion by strengthening the public education and
economic framework inherited from Pinochet while
health care systems, replacing the privatized pension
implementing consensus-based reforms to gradually expand
system, improving working conditions, and advancing the
the Chilean government’s role in regulating economic
rights of historically marginalized groups. He also has
activity and providing social services.
pledged to combat climate change and foster sustainable
development. Boric plans to fund such measures by
Although Chile has experienced significant improvements
increasing government revenues by 5% of gross domestic
in living standards since 1990, many Chileans have been
product over four years.
disappointed with the results of the post-Pinochet policy
consensus. Inequality has remained high, and many
Advancing that policy agenda may prove challenging. The
Chileans still lack economic security and access to quality
congress is split nearly evenly between left-leaning and
public services. Those shortcomings have contributed to
right-leaning parties, with Boric’s coalition holding 37 of
majorities in Chile expressing dissatisfaction with how
155 seats in the Chamber of Deputies and 5 of 50 seats in
the Senate. Consequently, Boric faces the difficult task of
https://crsreports.congress.gov
Chile: An Overview
negotiating legislation with centrist legislators without
more protectionist policies. In 2017, the Trump
alienating his leftist base. Additional challenges could arise
Administration withdrew from the Trans-Pacific
from the constitutional referendum. Whereas the approval
Partnership trade agreement, which had been signed a year
of a new constitution could trigger early elections or require
earlier by the United States, Chile, and 10 other countries in
Boric to dedicate much of his term to implementation, a
the Asia-Pacific region. Chile worked with the other
rejection could spur a new cycle of social unrest.
signatories to save the agreement, helping to forge a revised
Comprehensive and Progressive Agreement for Trans-
Boric also must contend with the lingering public health
Pacific Partnership in 2018. The Chilean congress has yet to
and economic effects of the Coronavirus Disease 2019
ratify the agreement, however, and President Boric has
(COVID-19) pandemic. According to Johns Hopkins
called for the agreement to be considered within the
University, Chile has recorded more than 57,000 COVID-
framework of the new constitution, once it is finalized.
19 deaths (302 per 100,000 people) since the start of the
pandemic. The country implemented one of the world’s
The United States and Chile also have differed on relations
fastest vaccine rollouts, however, and nearly 92% of
with China, which is Chile’s top trade partner and accounts
Chileans were vaccinated as of April 19, 2022. According
for 34% of Chile’s total trade (double the U.S. share). Chile
to the International Monetary Fund (IMF), the pandemic
signed an agreement on the Belt and Road Initiative in
contributed to a 6.1% economic contraction in 2020 but
2018, upgraded its free-trade agreement with China in
significant fiscal and monetary stimulus propelled the
2019, and joined the China-backed Asian Infrastructure
Chilean economy to 11.7% growth in 2021. The IMF
Investment Bank in 2021. U.S. officials have expressed
forecasts growth will slow to 1.5% in 2022 due to the
concerns about Chile’s ties to China, warning that Chinese
withdrawal of stimulus measures, rising inflation, and
investment often fosters corruption and that using Chinese
domestic and geopolitical uncertainty.
equipment in the country’s fifth-generation (5G)
telecommunications network could compromise Chile’s
U.S.-Chile Relations
national security, intellectual property, and data privacy.
Although the United States initially supported the Pinochet
Some Chilean legislators have sought to limit the influence
dictatorship, it also helped foster the restoration of
of Chinese state-owned companies in strategic sectors, but
democracy in Chile. Since the political transition, the
Chile has yet to restrict such investments.
United States and Chile have maintained close commercial
and defense ties and worked together to promote democracy
Foreign Affairs and Defense Cooperation
and human rights throughout the region. The Biden
Chile has supported various regional peace and security
Administration also has sought to collaborate with Chile on
efforts over the past decade. It was one of the top
shared challenges, such as the COVID-19 pandemic and
contributors to the U.N. Stabilization Mission in Haiti and
recovery, climate change, and regional migration flows.
helped facilitate the peace process in Colombia. Chile also
has supported efforts to restore democracy in Venezuela
Trade and Investment Relations
and foster development in Central America. The United
U.S.-Chile trade relations have grown considerably since
States and Chile maintain a High-Level Bilateral Political
the U.S.-Chile Free Trade Agreement entered into force in
Consultative Mechanism to coordinate on security
2004 (P.L. 108-77). Total bilateral trade in goods reached
cooperation, human rights, and other topics of mutual
$32.4 billion in 2021, a 43% increase compared with 2020
concern. They also work together under the U.S.-Chile
and a 24% increase compared with 2019, according to U.S.
Trilateral Development Cooperation Initiative to jointly
Department of Commerce data. U.S. goods exports to Chile
implement foreign aid projects in other countries.
amounted to $17.3 billion in 2021, with mineral fuels,
machinery, and motor vehicles accounting for a majority;
The Biden Administration has expressed interest in
U.S. goods imports from Chile amounted to $15 billion,
collaborating with the new Chilean government on issues of
with copper, fish, and fruit accounting for a majority.
mutual concern, such as promoting an equitable recovery
from the COVID-19 pandemic and addressing climate
Chile’s open economy, well-developed institutions, and
change. The Administration also has sought to reinforce
strong rule of law have made the country an attractive
U.S.-Chilean cooperation on democracy and human rights
destination for investment. According to the U.S. Bureau of
issues and irregular migration. According to U.N. data,
Economic Analysis, the accumulated stock of U.S. foreign
approximately 448,000 Venezuelans and 237,000 Haitians
direct investment in Chile stood at $23 billion in 2020, with
have migrated to Chile over the past decade, some of whom
significant investments in the mining, manufacturing, and
subsequently have sought entry into the United States.
finance sectors. In comparison, the stock of Chilean foreign
direct investment in the United States totaled $3 billion. A
In FY2021, the United States provided $455,000 in
bilateral treaty (Treaty Doc. 112-8) designed to encourage
International Military Education and Training (IMET) aid
investment in both countries by preventing double taxation
to Chile to enhance Chile’s peacekeeping activities,
was ratified by Chile but has been awaiting the advice and
strengthen the capabilities of the Chilean armed forces, and
consent of the U.S. Senate since 2012. The Senate Foreign
improve interoperability with U.S. forces. The United
Relations Committee reported the treaty favorably with two
States also transferred two C-130 Hercules aircraft, valued
reservations and one declaration in April 2022.
at $24 million, to Chile in 2021. The Biden Administration
has requested $450,000 of IMET aid for Chile in FY2023
U.S. and Chilean trade policies have diverged somewhat
(FY2022 allocations are not yet available).
over the past five years as the United States has adopted
https://crsreports.congress.gov
Chile: An Overview
Joshua Klein, Presidential Management Fellow
IF10880
Peter J. Meyer, Specialist in Latin American and Canadian
Affairs
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