CHAPTER X
COMMERCE
Home Factories.—Chilean Market Needs.—Sales to Foreign Countries.—Foreign Firms in Chile.—Trade-marks.
The position of commerce in Chile is better understood when it is realised that the country has no tropical products for sale. Apart from the extreme north, where rills of precious water redeem the preponderant desert, and where varying quantities of cotton, sugar and peppers are grown, farming is on a par with the farming of western or southwestern Europe, or the temperate regions of Mexico. Chile has a surplus of wheat, cattle and sheep; a large production of grapes and wine; and, in the mineral field, offers her unique supplies of nitrate as well as about 6 per cent of the world’s supply of copper. Timber from her southerly forests is chiefly used at home for house and ship building; Chilean coal finds its market in the Chilean factory regions or bunkering ports. Whatever the country has to spare of her cereals, fruit (fresh or canned) and other farm produce finds a ready sale in Peru and Bolivia; the copper is practically all ear-marked for the United States. Thus Chile’s offering to the world outside the Americas is not large aside from her immense and greatly needed output of nitrate of soda.
The establishment of four packing-houses (frigorificos) in Magellanic territory, with another recently constructed at Puerto Montt, follows and encourages the big development of the sheep-raising industry, with a view not only to supplying the non-pastoral north, but selling a surplus abroad. The wool produced, and formerly exported, is likely to be entirely absorbed by home weaving factories, to which an important addition has been recently made at Valparaiso.
Of great help in Chilean industrial development is the Sociedad de Fomento Fabril, and the work of three Government industrial schools, at Santiago, Chillan and Temuco, turning out electricians, chemists, blacksmiths, carpenters and other technically trained students.
A country with a temperate climate, hardy population, possessing plenty of fuel and offering securities to foreign capitalists and business firms, is likely to prove an inviting ground for the creation of factories; certain parts of Chile, in consequence, are developing home industries in a manner comparable to that of South Brazil.
A good start had been made before the European War, but as in many other South American regions the pressure of necessity brought about a remarkable and speedy industrial growth. Deprived of big quantities of manufactured goods, Chile increased or built national mills, and can today produce a remarkably long list of the goods she needs. Home utilization of raw materials of course tends to limit Chile’s export lists and, diminishing her income from overseas, narrows her capacity for purchases in foreign countries, rendering her still more dependent upon nitrate exports for national revenues.
Chile’s beds of good coal, with the addition of immense forestal areas offering lumber, and, also in the south, considerable water-power resources, form a sound basis for manufacturing. Below the river Aconcagua factories are thickly dotted, and south of the Maule is a 600-mile stretch of country where new industrial towns lie like beads on a string, following the railroad track. Altogether, the large and small factories of Chile number twenty-seven hundred, counting every industry from Tacna to the Straits of Magellan; the group of important establishments employs 70,000 people, of whom 40,000 are men, over 17,000 are women, and over 5000 are children less than fourteen years old. Another 8000 people are employed by little industries. The value of the merchandise produced by these factories increased by nearly 50 per cent between 1915 and 1919, the latter year registering the manufacture of goods worth more than 765,000,000 pesos, Chilean paper. At an exchange value of twelve pence, this is equal to over £38,000,000. Santiago province topped the list with manufactured produce worth 280,000,000 pesos, Valparaiso following with 163,000,000 and Concepción coming third with 68,000,000 pesos.
Included in this output are metal goods, furniture, dried and tinned fruit, wines, beer, mineral waters, butter and cheese, lard, candles, soap, boots and shoes, wheat flour, Quaker oats, woven woollen and cotton cloths, pottery, chemicals, brown paper, bottles and other glass utensils, sugar and tobacco. Factories manipulating the two last-named commodities do not draw supplies of raw materials from Chilean soil but depend upon importations, chiefly from Peru. There are two sugar works, both Chilean-owned and operated; one is situated at Valparaiso and another at Penco (near Concepción City), where soft brown crystallised sugar is brought in sacks, and, after undergoing a series of new processes, including bleaching, is distributed to local firms in the form of soft white or cube sugar. The Chilean market rejects all sugars presenting any hue but that of pure white, I was informed when enquiring at Penco why at least a proportion of the excellent brown sugar imported could not be distributed in that condition, and at considerably lower cost to the consumer. When the refinery was erected it was hoped that it could be exclusively supplied with raw material from local sugar-beet farms, and the failure as yet to produce these crops in quantity is emphasised by the retail price of sugar in Chile—fifteen pence per pound in 1920.
