No, it is not a typo. I know the mainstream press cannot get enough of Brazil. I too have sung (still sining) the praises of the future host of the Olympics. On the other side of the continent from Brazil is a sliver of a country that boasts an impressive economy. With 16 million people this country has weathered the financial better than most countries.
Not just good wine
Chile has gone through significant change in the last two decades. Today, Chile has a national debt of only 4% of GDP. Thanks to the boom in copper prices and other commodities Chile has a large sovereign wealth fund ($22 billion). Copper alone provides 1/3 of government revenue. Chile is also a large exporter of fish, grapes, apples, wheat and beef. During the 80’s Chile reduced poverty by half and in the 90’s sound economic policies helped lead the economy to 8% + annual growth rates. Chileans have been very good about saving for a rainy day as well. The privatized national pension system in place is not perfect but has contributed to a very high domestic savings rate over 20% of GDP
Trade Happy
Chile claims to have more bilateral or regional trade agreements than any other country with 57. These agreements cover countries like China, European Union, India, South Korea, Japan, U.S., and Canada. With desirable exports, strong savings and a population getting used to prosperity there is much room for growth.
The ETF Play
The iShares MSCI Chilean Investable Market Index (ticker ECH) is up 75% ytd and is well above its 50 and 200 day ema. The main industries represented are utilities and materials with a total of 34 holdings.
Chart courtesy of StockCharts.com
Disclosure Statement: ETFGPS is a blog that Navigates The World of ETFs. Sustainable Investment Strategies LLC is a Registered Investment Adviser in the State of Maryland, and does hold positions in the EPP ETF at the time of writing. Investors who are interested in money management services may visit the Sustainable Investment StrategiesLLC web site.
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