Panama to Patagonia

by Charles M. Pepper

The duty on the raw sugar is 6.50 pesos, or Chilean dollars, per 100 kilograms, equal to nearly one cent per pound in gold. The duty on refined sugar is about two cents per pound. The output of the refinery at Viña del Mar is 53,000,000 to 54,000,000 pounds, much of which is exported. This refinery, with a capital of $1,500,000 gold, through a period of ten years, paid annual dividends of 10½ per cent.

Agricultural exports, in the decade from 1893 to 1902, ranged from $2,000,000 to $4,500,000 annually. The latter sum seems likely to prove the minimum basis for the future.

The industrial resources of Chile are mirrored, though not with completeness, in the Permanent Industrial Exhibition which was opened in 1904. This covers not only the products of the soil, but also the home manufactures that are fabricated either from imported raw material or from half-manufactured products brought in to encourage the home industries. The Chilean policy is protective both by bounties and by duties. The sugar refineries, which import the raw cane sugar from Peru, are among the most stable of the industries. The flour-mills are also profitable enterprises. They grind the native wheat, and have a market for the flour for export in Bolivia and Peru, as well as farther up the coast.

The country has about 8,000 industrial establishments. Among these are 400 engaged in tanning and curing hides, 430 in various kinds of wood-working, 308 in metallurgy, 268 in chemical products, 560 in ceramics or pottery, 1,900 in food products, 1,920 in cloth manufacture and tailoring, 700 in building, and so on. Car-shops are maintained in connection with the State railways. A disposition on the part of foreign capital to engage in textile manufactures has received encouragement, and woollen and cotton mills may result. The native labor, judged by the experiments, is competent.

The public works policy has become the programme of all political groups, though the Congress sometimes is laggard in voting the appropriations recommended by the Executive. Railways are its most important feature. No chapter in Chile’s history is more creditable to her people than the sacrifices made for building railways, and nothing shows the national instinct better than the perception that was demonstrated of the part which railroads play in both the industrial and the political development of a nation. In 1905, 3,100 miles were in operation, with many new lines under way. The majority of the lines are owned by the government, with the exception of the nitrate roads and the Chilean section of the Antofagasta and Bolivian Railway.

This State ownership is at once an advantage and a drawback. The policy of government proprietorship has made possible the building of links that have been of great value in internal development, and that will be of greater value when they become joined together as parts of one system. The disadvantage is in operation. When a Buenos Ayres railroad president was considering the extension of the Southern Railway of Argentina through the lower Andes to a junction with the Chilean roads,—all of which will come some day,—he made inquiries about the earnings of the Chilean system under government control. He was told that they had amounted to $18,000,000. That was very good indeed, considering the mileage and rolling-stock. “And how much did it cost to operate them last year?” he inquired. “$20,000,000,” was the reply. This meant that under State management roads which would have paid dividends showed a healthy deficit. The deficit is not invariable, for in 1903 the government railways showed a surplus of $1,360,000 Chilean currency.

This government administration illustrates the evils of the use of patronage. The management is expensive; there is favoritism, discrimination, losses, unnecessary employees by the hundred. When the national policy is matured, and the country has the railways which are necessary and which would not have been constructed except by the government, the political evils can be overcome easily. The lines can be leased to private companies under a rental which will insure profit to the lessees and a steady revenue to the government. The State railways have an annual traffic of 3,000,000 to 3,500,000 tons of freight, and carry from 7,000,000 to 7,500,000 passengers.

The Chilean aspiration has been shown very clearly in the dogged determination with which the longitudinal line paralleling the coast and the Cordilleras has been carried forward. This policy already has given a section of the central valley the benefits of railway transportation, and in a few years undoubtedly the gaps will be closed so that the through journey can be taken from Santiago to Puerto Montt at the entrance of the Chiloe Archipelago. Also it will bring Iquique and the nitrate provinces of the North into through railway communication with the capital and the South. These northern links will be of marked value in reviving copper and silver mining.

The trans-Andine road, completing the gap from Los Andes through the Uspallata Pass to the Argentine boundary, when completed, will open a new chapter of intercontinental transportation. Promise is held out that the line may be in operation by the end of 1907, but the great spiral tunnel, which is the engineering device for breaking the back of the Cordilleras, may require a longer time. The important fact is that after delays of forty years the Chilean government guaranteed capital to the amount of $7,500,000 an annual return of 5 per cent for twenty years, and let the contract. A colossal bronze statue, resting on a granite column, the Christ of the Andes, at the very pinnacle of the Cordilleras, is a striking monument along this railway line. It is just on the boundary between Chile and Argentina, and commemorates the peace treaty without which the railroad systems of the two Republics would not have been joined. The idea of the commemorative statue was due to Señora Angela de Costa, of Buenos Ayres. The influence of this trans-Andine railway on the mutual commerce of Chile and Argentina by establishing through communication between Valparaiso and Buenos Ayres will be considerable, but it promises to be even more beneficial in bringing the western pampas of Argentina to the Pacific and to Panama.