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Chile, Latin America's Rising Star

Chile, although a smaller overall economy than Brazil, is growing quickly in South America and should not be overlooked.

Chile has shown tremendous progress since the financial crash of 2008. Overall GDP has grown by nearly 50% over the last five years. Unemployment peaked at just under 11% in 2009 and has steadily improved to 6.1% in April, even lower than 2012's 6.5%. In addition, wages per hour are up over 20% from 2009 levels.

Higher unemployment and stronger wages have boosted the Chilean consumer. Chile's retail sales grew by 10.8% during April from a year earlier after expanding by 10.2% from a year earlier in March. And overall Chilean consumer spending is also up nearly 50% since the financial crisis.

As Chile's economy has grown, it has diversified away from being a commodity-dependent economy, and invested more in technology, financial services and agribusiness. However, a portion of this growth has been fueled by government investment in infrastructure and technology. Total Chilean government debt is alarmingly up from 3% to 12% of GDP over the past five years. 

Yet, Government debt is still rated "stable" with a AA rating. Chile now has the highest GDP per capita in Latin America and the World Bank has also ranked its global competitiveness the highest in Latin America. With a GDP at 10% of Brazil’s size, there is still a lot of room for Chile to grow. Alexander Fleiss serves as Chairman and Chief Investment Officer of Rebellion Research Partners LP, a Global Macro hedge fund and financial advisory that invests across all asset classes and is based in New York. Mr. Fleiss also oversees the firm's institutional research ... View Full Bio

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