MSG086G/01E CHILE-TRADE: Surplus Nearly Doubles in Two Weeks

• by IPS Correspondents (santiago)
• Thursday, December 08, 1994
• Inter Press Service

SANTIAGO, Dic 08 (IPS) - Rising copper prices have caused Chile's trade surplus to nearly double in two weeks, going from 327.9 million dollars in the first 10 months of 1994 to 632.6 million by Nov. 15, according to Central Bank figures released Thursday.

Chile's copper exports for those two weeks totalled 401 million dollars.

Last year, the South American nation sustained a trade deficit of 978.6 million dollars, and the Central Bank initially foresaw a deficit only slightly lower for 1994.

The recuperation of exports, especially in the mining sector, led officials to adjust their outlook at midyear, predicting a relative balance between import expenses and export profits.

However, as the prices of copper and other exports continued to rise, the possibility of a trade surplus of some 300 million dollars began to emerge, and recent figures indicate a still more favourable balance of trade.

Copper made up more than 40 percent of the country's exports in 1993, with an average price of 0.86 dollars for the year.

The price of the metal began a spectacular recuperation in May, now averaging 1.02 dollars a pound for the year to date. Prices rose 10 percent last month alone, ending the month nearly 72 percent above November 1993 prices.

During the first two weeks of November, Chile's total exports were worth 772.1 million dollars, with 467.4 million in imports. Meanwhile, 1994 exports through Nov. 15 totalled just over 10 billion dollars, with some 9.4 billion in imports.

The recovery of exports and income from foreign investments has generated a glut of dollars in Chile, causing the local currency to appreciate in late November.

According to the Central Bank's most recent report, Chile's net foreign currency reserves have increased to some 12.7 billion dollars, equivalent to about 14 months' worth of imports.

The rising reserves are due in part to the Central Bank's purchase of dollars on the local exchange market in recent weeks to keep the exchange rate from rising too sharply.

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