When one turns to the other side of the ledger, to see what Chilean merchandise is exchanged for these imports, the dangerously dominant position of nitrate becomes evident. The total exports rose from 300,000,000 pesos in 1914 progressively to nearly 764,000,000 in 1918 (subsequently suffering violent fluctuations) and of the latter amount nitrate and iodine accounted for over 532,000,000, with another 109,000,000 placed to the credit of “minerales metálicos en bruto,” of which the chief if not the sole representative was copper.
Products of livestock farming, chiefly hides and wool, have risen in export value during the last few years, and may be reckoned as worth an average of 35,000,000 pesos; vegetable products shipped out, with cereals predominating, have varied lately between 14,000,000 and 42,000,000 pesos; manufactured foodstuffs (dried or frozen meat, sugar, cheese, flour) have grown in value since 1914 from 7,000,000 to nearly 24,000,000 pesos; 1,000,000 pesos’ worth of wine is exported; some pottery, glass and leather; and an increasing quantity of unworked lumber. But none of the farming, metallic, forestal or manufactured merchandise groups show signs of growing ability to equal nitrate in export values. Fortunately, the world needs Chilean nitrate, and there is no prospect of the rise of a rival which could meet the naturally produced chemical in price if drastic and feasible cuts were made in export taxes.
Disorganization of world markets since 1914 has affected the imports of Chile not only as regards bulk but also origin of supplies. It will probably not be possible for a judgment to be formed concerning the trend of trade until after 1922, when the flow of commerce may have resettled into regular channels. The general effect of the war years was to send merchandise north and south instead of east and west: a big increase occurred in the trade relations between North and South America, while the stride in commerce between the different South American nations was perhaps even more remarkable.
Intercourse amongst the sister nations has been delayed in the past by lack of coastal shipping and international railways as much as by laws of supply and demand. It has been frequently said that the different Latin-American states have nothing to sell to each other because they all produce the same class of goods, needing similar commodities only to be obtained from the advanced manufacturing countries. The latter part of the contention has a great deal more force than the first; South America must buy certain classes of goods afield, but a careful scrutiny of production lists brought to light, after 1914, many prime materials that could be exchanged, the impetus given to a coastwise traffic (cabotaje) along both Atlantic and Pacific Coasts proving the success of the new efforts. Several Latin-American states own maritime lines, but Chile and Brazil in particular aid the new inter-American trade development with excellent steamship and sail services under national flags.
Brazil doubled her sales to Chile between 1914 and 1919; Argentina increased the value of her shipments from under 6,000,000 pesos (Chilean gold, of eighteen pence each) in 1914 to 31,000,000 four years later; Colombia and Costa Rica increased their sales of fine coffee (via Panama); Ecuador sent more cocoa and Peru more fruit and sugar—Peru’s sales, worth 14,000,000 pesos in pre-war years rising to over 32,000,000 in 1919. Mexico’s sales to Chile rose from a few thousand pesos in value to over 7,000,000, during the last six years.
Chile at the same time made big increases in her own shipments to Latin-American countries. Her sales to Argentina rose from 4,500,000 to 26,000,000 pesos at eighteen pence; to Bolivia, from 4,000,000 to 8,000,000; to Peru, from 3,000,000 to 18,000,000; to Mexico sales were doubled during war years. In some cases, as those of Uruguay and Brazil, there have been fluctuations so marked that no conclusions can be drawn: but on the whole the stimulus to inter-American trade has been well sustained.
With the United States a tremendous development of traffic took place. Exports from Chile rose from 86,000,000 pesos in 1914 to 489,000,000 in 1918; at the same time Chile’s purchases from the United States, totalling about 55,000,000 pesos in 1914, soared to more than 203,000,000 four years later. In the case of both exports and imports, values were inflated and have not been sustained, although the development of the North American mercantile marine since 1914 is likely to promote a greater share of commerce with South America than was normal before the conflict. It is interesting to note that despite the huge expansion of North American trade with Latin America during war years, inflation in all directions was so great that the proportion of business done by the United States with South America remained the same as it has been for a hundred years—5 per cent of the total exterior commerce.
A remarkable series of changes has been experienced in the export lists of Chile during her economic life. In early days one of the most important exports appeared on shipping invoices as “Bezoar stones,” those curious concretions, forming in the bodies of certain vegetable-feeding animals, which were considered medicinally potent in the Middle Ages. Faith in the Bezoar stone and supplies came from the East to Europe, but after the discovery of the Americas it was found that the llama and guanaco also formed the precious object, and trade grew brisk.
Once upon a time Chile shipped the bulk of her copper to India, taking Oriental cottons and other merchandise in exchange; this trade has long been discontinued, although Hindu as well as Japanese retailers are reviving business with Chile. Up to 1887 Chile was still exporting the skins of vicuña, now vanished from her confines, and the beautiful chinchilla, also practically extinct in Chilean uplands.
The trade with the eastern side of the Andes in Yerba Maté received a blow when with Independence it was possible for freer commerce to offer Indian and China teas to the former colonies of Spain; but the peasant classes of Chile are still faithful to the maté and the bombilla, and a decreased but steady import continues.