The land

The major landforms of Chile are arranged as three parallel north–south units: the Andes mountains to the east; the intermediate depression, or longitudinal valley, in the centre; and the coastal ranges to the west. These landforms extend lengthwise through the five latitudinal geographic regions into which the country is customarily subdivided. From north to south, with approximate boundaries, these are Norte Grande (extending to 27° S); the north-central region, Norte Chico (27° to 33° S); the central region, Zona Central (33° to 38° S); the south-central region, La Frontera and the Lake District (38° to 42° S); and the extreme southern region, Sur (42° S to Cape Horn).

The Chilean Andes

Extending almost the length of the country, the Chilean Andes, which form most of the border with Argentina, include the highest segment of the Andes mountain chain, which acts as both a physical and a human divide. The Chilean Andean system consists of lofty, often snow-capped mountains, deeply incised valleys, and steep slopes.

The formation of the western Andes ranges began during the Jurassic Period, some 200 million years ago. Marine and terrestrial sediments that had accumulated in the Andean geosyncline were folded and lifted as the Pacific Plate was overridden by the South American Plate. In the Cenozoic Era (beginning about 65 million years ago) active volcanism and the injection of effusive rocks laid down the paleovolcanic materials (rhyolites and dacites) that contain the rich copper, iron, silver, molybdenum, and manganese ores of Chile. Also of Cenozoic origin are the coal deposits of central Chile.

Later in the Cenozoic Era the uplift of the Andes continued, accompanied by further outbursts of volcanism. This active tectonism led to the separation of the Andes from the older coastal ranges and the formation of the intermediate depression. At the beginning of the Quaternary Period (about 2.6 million years ago) the Andes had reached a higher elevation than at present. During the global cooling that occurred from the beginning of the Quaternary, the higher summits were covered by ice masses whose glacier tongues descended into the intermediate depression. Rich sediments were washed down the glacial valleys and deposited into the longitudinal depression. The numerous lakes in the Lake District of south-central Chile are remnants of the ice melting that began some 17,000 years ago. Since the advent of the Holocene Epoch (11,700 years ago) the Chilean Andes have not changed significantly, but they still experience uplift and episodic volcanic eruptions.

The Andes of northern Chile to latitude 27° S are wide and arid, with heights generally between 16,500 and 19,500 feet (5,000 and 6,000 metres). Most of the higher summits are extinct volcanoes, such as the Llullaillaco, 22,109 feet; Licancábur, 19,409 feet; and Ojos del Salado, 22,614 feet. After the last glaciation the melting waters collected in shallow lakes in the intermediate elevated basins. Today these salt lake basins (salares), the most noted of which is the Atacama Salt Flat, are evaporating to the point of disappearing. Farther south the mountains decrease somewhat in height, but in central Chile, between latitudes 32° and 34°30′ S, they heighten again, with peaks reaching 21,555 feet at Mount Tupungato and 17,270 feet at Maipo Volcano. All of these summits are capped by eternal snow that feeds the numerous rivers of central Chile. Winter sports are pursued in the Andes near Santiago.

Most of the highest mountains between 34°30′ and 42° S are volcanoes, ranging between 8,700 and 11,500 feet. Some of them are extinct while others are still active. Among them are Copahue, Llaima, Osorno, and the highest, Mount Tronador, at an elevation of 11,453 feet. Their perfect conical shapes reflecting on the quiet waters in the Lake District provide some of the most splendid scenery in temperate South America. In southern Chile, below latitude 42° S, the Andes lose elevation and their summits become more separated as a consequence of the Quaternary glacial erosion.

Farther south is Chilean Patagonia, a loosely defined area that includes the subregion of Magallanes and sometimes Chilean Tierra del Fuego. There significant heights are still reached: Mount San Valentín is more than 12,000 feet high, and Mount Darwin in Tierra del Fuego reaches almost 8,000 feet. Reminders of the last ice age are the perfectly U-shaped glacial troughs, sharp-edged mountains, Andean lakes, and some 7,000 square miles of continental ice masses. The Southern Ice Cap, between 48°30′ and 51°30′ S, is the largest in the Southern Hemisphere, with the exception of Antarctica.

The intermediate depression

The intermediate depression between the Andes and the coastal ranges is mostly flanked by fault lines. A natural receptacle for materials coming from the Andes, the depression has been filled by alluvial, fluvioglacial, or moraine sediments, depending on the region. In northern Chile it appears as a plateau with elevations between 2,000 and 4,000 feet. Saline sediments that washed down during the Cenozoic Era created the rich nitrate deposits found in the Tamarugal Plain and Carmen Salt Flat, where the once-bustling mining towns of María Elena, Pedro de Valdivia, and Baquedano are located. In north-central Chile, extending southward out of the desert region, the depression is interrupted by east–west mountain spurs that create fertile transverse valleys. The Aconcagua River valley, a transverse valley farther south, marks the beginning of central Chile.

The alluvial deposits from the numerous Andean rivers in central Chile have provided mineral-rich soils that support the flourishing Mediterranean-type agriculture of the Central Valley of the intermediate depression. These soils and abundant water resources, along with a temperate climate, make the Central Valley the most populated and productive area in Chile. In south-central Chile the intermediate depression is formed by mixtures of fluvial and alluvial depositions, making this region suitable for growing grain and for pastures that support an important dairy industry.

South of the Bío-Bío Biobío River dense forests replace open scrub woodland moraines and lakes are common, and the intermediate depression descends to sea level at Puerto Montt. In the extreme south only the Andes and the summits of the coastal ranges are visible because the intermediate depression submerges or is replaced by intracoastal channels and fjords.

The coastal cordilleras

In most of northern and central Chile coastal ranges form a ridge between the intermediate depression and the Pacific coast. These mountains, which are seldom higher than 6,500 feet, display smooth forms or flattened summits, since they are considerably older than the Andes. In north-central and central Chile the coastal ranges are built of granites and metamorphic rocks of the Mesozoic and Paleozoic eras (i.e., about 65 to 540 million years old) that were uplifted during the Andean folding phase. In south-central and southern Chile the coastal ranges consist of early Paleozoic metamorphic and igneous rocks, which is evidence of an even earlier folding phase. The coastal ranges were never glaciated, and their former dense vegetation has been destroyed by humans. In places where intensive agriculture has been practiced, the soil is severely eroded and has been depleted of organic and mineral nutrients. Only in the evergreen forests in the Cordillera de Nahuelbuta south of Concepción and the coastal ranges south of Valdivia are the soils well preserved.

On the western margins of the coastal ranges, sea advances during the early to middle Cenozoic Era deposited thick sediments. During the late Cenozoic, sea level changes and continued continental uplift created several coastal terraces in the Cenozoic layers, and wave erosion shaped Chile’s abrupt coastline, which has few good natural harbours.


Most of Chile’s rivers originate in the Andes and flow westward to the Pacific Ocean, draining the intermediate depression and the coastal ranges. They are therefore quite short. While their steep gradients and turbulent flow make them unsuitable for navigation—the lower courses of the south-central rivers are an exception—they are particularly useful for hydroelectric power. In areas where water flow is subjected to seasonal variations that hamper agricultural development, dams have been built in order to regulate the rivers and to establish hydroelectric plants.

The rivers of Chile have differing physical characteristics that are related to the climatic region in which they are located. In the parched northern region they are fed by the summer rains that fall on the Chilean-Bolivian Altiplano; their volumes are so small that they are either absorbed by the soil or evaporate before reaching the sea. Only the Loa River, the longest Chilean river at some 275 miles, empties into the Pacific Ocean.

The rivers of central Chile have more regular flows and volumes. During the winter months (May–August) they are fed by heavy frontal rains, resulting in frequent flooding of the riverine communities. In late spring (October–November) the rivers receive the runoff from the snow that has accumulated during the winter in the high Andes. This runoff proves quite beneficial for commercial and subsistence crop irrigation. In south-central Chile south of the Bío-Bío Biobío River, the steady flow is maintained by constant rains, although there is a slack in discharge during the summer months (December–March). In Chilean Patagonia and Tierra del Fuego intense year-round rains and snowstorms combine to keep the rivers well fed, but their extremely steep drainage into the Pacific renders them totally unusable for commercial purposes.


The geologic variety and diverse origin of surface sediments cause the soils of Chile to vary greatly in character from north to south. In the northern desert region saline soils, made up of gravel and sand cemented with calcium sulfate, alternate with alkali-rich soils, which are difficult to cultivate even with irrigation because of their surface salt accumulations. In river oases salinity also becomes a limiting factor for agriculture. In the transverse valleys of north-central Chile, fertile alluvial soils have developed on fluvial deposits, while between the rivers soils are dry and infertile. Within the Central Valley the alluvial soils have developed over fluviovolcanic deposits, which is the reason for their mineral and organic richness. In areas of widespread recent volcanic activity, andosol soils (nutrient-rich soils that develop over volcanic ash) are common. Under good aeration these soils of the Central Valley have excellent agricultural potential, but if the volcanic soils are too permeable, they can be used only for coniferous plantations. In the Lake District the extreme impermeability of the soils leads to the formation of humid soils (trumaos). In the southernmost Andes, under conditions of permanent rainfall and cold temperatures, lithosols covered by a thin layer of andosols are the rule: only rain forests grow on such soils. On the archipelagos of Chilean Patagonia and Tierra del Fuego, the low terrain is carpeted by moorland soils that support only low shrubs and bog plants of no economic value or potential. Soils at high elevation are characterized by rankers (thin organic soils overlying a rocky substratum) supporting growths of Antarctic beeches.


The extension of Chile across some 38 degrees of latitude encompasses nearly all climates, with the exception of the humid tropics. The Pacific Ocean, the cold Peru (Humboldt) Current, the South Pacific anticyclone winds, and the Andes Mountains constitute the major climatic controls.

The permanent chilling effect of the Peru Current and the constantly blowing southwesterlies emanating from the South Pacific anticyclone determine a temperate climate for most of northern and central Chile. Only the extreme south, unaffected by these controls, is characterized by a cold and humid climate. Temperatures drop in a regular pattern from north to south; the principal cities average the following annual mean temperatures: Arica 64 °F (18 °C), Antofagasta 61 °F (16 °C), Santiago 57 °F (14 °C), Puerto Montt 52 °F (11 °C), and Punta Arenas 43 °F (6 °C). During winter, when the polar front advances northward, temperatures drop, though not drastically, owing to the temperate action of the ocean. If snow falls in central Chile, it does not stay on the ground for more than a few hours. During summer, cooling sea winds keep temperatures down and there are no heat waves. The highest monthly means register in the northern desert.

Annual precipitation differs remarkably from the dry extreme north to the very humid extreme south. North of 27° S latitude there is practically no rainfall. In the north-central region frontal rains in winter account for increasing precipitation: the annual rainfall in Copiapó is less than one inch (21 mm). In Santiago the annual rainfall is 13 inches, and along the Central Valley it increases gradually southward until it reaches 73 inches in Puerto Montt, where precipitation occurs throughout the year. The coast of central and south-central Chile is more humid than the Central Valley. In Valparaíso annual precipitation amounts to 15 inches, rising to 52 inches in Concepción and reaching about 90 inches in Valdivia. Farther south, where the westerlies reach their maximum intensity and the polar front is always present, precipitation highs unequaled by any other nontropical region in the world have been recorded; there, San Pedro Point, at latitude 48° S, receives about 160 inches annually. Still farther south, in the rain shadow that occurs on the eastern slopes of the southern Andes, precipitation diminishes drastically, occurring mostly as snow during winter. Punta Arenas, in Chilean Patagonia, receives only 18 inches annually.

Considering all climatic factors and meteorological characteristics, three large climatic regions may be distinguished in Chile: the northern desert, the central Mediterranean zone, and the humid-cool southern region.

The northern desert

This region experiences an aridity that is primarily caused by the dry subsidence created by the South Pacific high pressure cell and the stabilizing action of the cold Peru Current. Although the air along the coast is abnormally humid, it never reaches saturation point; at most, there is a development of coastal fogs (garúa or camanchaca). Besides the lack of rain, drainage systems, and permanent vegetation, the Chilean desert is characterized by relatively moderate daytime temperatures, the variations in which are dependent upon the direct heat of the Sun; during the night, temperatures may approach the freezing point. In the piedmont oasis of Los Canchones the daily temperature fluctuates up to 47 °F (26 °C). The interior of the Atacama Desert, which makes up a large portion of the southern part of the desert region, is reported to receive the highest solar radiation in the world.

Mediterranean central Chile

The climate of central Chile is characteristic of mid-latitudinal temperate areas. The seasons are well accentuated. Winters are cool and humid as a consequence of continuous passages of fronts and depressions; cloudy days are common. In spring, when there are fewer fronts and the depressions vanish, steady southwest winds and clear skies dominate. During summer, when anticyclonic conditions are established, the days are warm, though not stifling, and without rain. These weather conditions are ideal for the Mediterranean agricultural products that grow so well in central Chile, such as grapes, peaches, plums, honeydew melons, and apricots. Autumn is still sunny and dry, suitable for the ripening of grains, mainly wheat, and vegetables. With the onset of winter, the fronts and depressions return and the accompanying rains last from May to August.

Southern Chile

The southern segments of Chile are always under the influence of the polar front and of cyclonic depressions. In addition, the permanently blowing westerlies batter the margins of the continent with oceanic air masses that lower temperatures and cause heavy rainfall along the Pacific coast. Around Cape Horn the westerlies reach their maximum intensity and storms abound. Before the era of steam power, the passage from the Atlantic to the Pacific via Cape Horn was a most feared venture.

Plant and animal life

The vegetation of Chile, like the climate and soils, is arranged in latitudinal belts. Only in the Andes is altitude a determining factor. In the northern desert region the vegetation has adapted to the lack of rain and to the salinity of the soils. The tamarugo, a spiny acacia tree, does well in the dry interior desert. Near the coast, and kept alive by the coastal fogs, varieties of cacti as well as shrubs and spiny brambles occur. In the high plateaus of northern Chile hardy species, such as llareta, and grasses, such as ichu and tola, support the Indian population and their llama herds. In semiarid north-central Chile some of the cacti continue, and hardwoods, such as the espino or algarrobo, and shrubs, such as Adesmia, become more common. In the more humid and temperate region of central Chile grows a particular vegetal formation called matorral, in which hardwoods, shrubs, cacti, and green grass are mixed. Most of this dense growth is disappearing because of the rural population’s overexploitation of it for firewood. South of the Bío-Bío Biobío River, mixed deciduous forest and evergreen trees are common. Many unique species are found in these humid forests, the most conspicuous being the rauli, or southern cedar, the roble beech, the ulmo (an evergreen shrub), and the evergreen laurel. On the western slopes of the Andes the magnificent monkey puzzle tree, or Chile pine, forms dense stands. A dense rain forest, rich in timber species, grows in the humid Lake District and extends southward. The Antarctic beech, the Chilean cedar, and the giant alerce dominate these often impenetrable southern woods. On the rainy islands of Chilean Patagonia and Tierra del Fuego, the growth of large trees is inhibited by the constant winds and low temperatures. There, only dwarf versions of southern beech and hard grasses are found. In eastern Chilean Patagonia the cold steppes are primarily composed of grasses and herbs that provide grazing for livestock.

The animal life of Chile lacks the diversity of other countries in South America. The barrier of the Andes has restricted animal migrations, and the northern desert has proved a formidable obstacle to the southward migration of tropical Andean fauna. Among the terrestrial animals, the most abundant and varied are the rodents. The chinchilla, the degu, and the mountain viscacha are Andean rodents famed for their fine furs. Monito de monte, a marsupial, lives in the deciduous forests and rain forests of the south. The nutria, or coypu (coipo) is a water rodent common in the streams of Chile. Among the ruminants are the guanaco, the only survivor of the Paleocamelides (ancient predecessors of the camel family), and its domesticated relatives, the llama, the alpaca, and the vicuña, the latter known for the high-quality wool produced from its silky fleece; the Indians of the Altiplano make wide use of it. Guanacos are still found from northern Chile to Chilean Patagonia. Two members of the deer family are the huemul, a rarely seen inhabitant of the southern Andes that is represented on the national coat of arms, and the pudu, the smallest known deer. Carnivores are not in great abundance. The puma is the largest, and other feline predators include the guiña and the colocolo. Among the canids are the Andean wolf and the long-tailed fox. The avian fauna is relatively more diverse, the country being host to wintering migratory birds. Some exotic birds like parrots and flamingos appear over northern and central Chile. Throughout the Chilean Andes there still lives, though reduced in number, the condor, a large scavenger. In Chilean Patagonia is found the carancha, a bird of prey that attacks lambs. Amphibians abound, the most curious being Darwin’s frog, discovered by Charles Darwin in south-central Chile. Chile’s geographic isolation accounts for the absence of poisonous reptiles and spiders.

Settlement patterns

Climatic characteristics and historic events have strongly influenced settlement patterns and population distribution in Chile. The early settlement by Spaniards occurred in the temperate part of the country, known as the Central Nucleus, or Zona Central, where the agriculture, industry, and main population centres developed. The area’s traditional agriculture developed on the basis of large landed estates, the haciendas, which covered about three-fourths of Chile’s arable land. The agrarian reform initiated by the Christian Democratic president Eduardo Frei Montalva in 1965, and continued by the Socialist president Salvador Allende Gossens into the early 1970s, resulted in a redistribution of the land. Agrarian productivity to boost exports was accentuated.

In the Central Nucleus are the major cities of Chile. Santiago was founded there and grew into the country’s major metropolis. Seventy miles west of Santiago is the port city of Valparaíso and the neighbouring resort city of Viña del Mar, which form the second largest population centre of Chile. In the Central Valley, south of the Santiago basin, stretches a series of secondary cities, the development of which has been tied to the agricultural success of central Chile. Among them are Rancagua, Curicó, Talca, Chillán, and Los Angeles. All of these cities are connected by rail and the Pan-American Highway.

Most of Chile’s cities were founded during the colonial era, and they were arranged around a central square (plaza de armas). The original buildings were made of adobe (sun-dried brick) and wood, materials that would deteriorate or burn. Most of the colonial buildings fell prey to earthquakes and fires; much rebuilding took place and the cities of central Chile have become showcases of modern urbanization, high population density, and bustling commercial and industrial activities. On the coast of the southern Central Nucleus lies Concepción and its port city of Talcahuano, both industrial centres.

Norte Chico, the semiarid north-central part of Chile, developed in close association with the Central Nucleus. Agricultural production and mining characterize this region, of which La Serena, near the coast, and the port of Coquimbo are the major centres. The population is primarily concentrated in the irrigated valleys of the Copiapó, Huasco, Elqui, and Limarí rivers or else dispersed in the mountains, where there are mining activities. The main cities, somewhat smaller than those of central Chile, are located in the valleys: they include Copiapó, in the valley of that name, the most important mining centre of the country during the 19th century; Vallenar, Ovalle, and Vicuña. Agriculture, goat raising, and iron and copper mining are the main economic activities. From this region come the famous pisco (a white brandy distilled from sun-dried grapes), fine wines, and high-quality fruits for export.

During colonial times, the fringe of territory at the southern extreme of the Central Nucleus was bitterly contested by Spaniards and Araucanians, the original Indian population, which gave the northern part of south-central Chile its name, La Frontera (“The Border”). After the pacification of the Araucanians in the 1880s, the area was gradually settled by Chileans and by European colonists who had already begun immigrating there in the 1850s. It developed in modern times as a region of grain growing and commercial pine forestry for cellulose manufacture. The regional capital is Temuco, and in the surrounding countryside still live—in rather precarious conditions—a concentration of Araucanians, locally called Mapuche.

Colonization of the Lake District, located south of La Frontera, began after 1850 with immigrants from Germany, Switzerland, and Belgium. Homesteads, rather than large haciendas as in the Central Nucleus, became the pattern of rural settlement. Although the land has been consolidated in recent times, land fragmentation is still visible. The largest city of this region is Valdivia, founded in early colonial times. This once active industrial centre for footwear, textiles, brewing, and shipbuilding declined after most of its manufacturing installations were destroyed by a 1960 earthquake. Osorno and Puerto Montt are other regional centres, specializing in dairy and flour production. The scenic piedmont lakes and the snow-capped volcanoes attract a steady flow of tourists.

The extreme north and the extreme south could be considered the population and resource frontiers. Both are sparsely populated and rich in natural resources. Settlement of the arid Norte Grande in northernmost Chile began in the middle of the 19th century in response to the exploitation of minerals in the interior. A string of coastal cities emerged as export centres for nitrates, borax, and copper. Iquique, once an exporter of nitrates, has become the capital of Chile’s fish meal industry. Antofagasta, the railroad terminus to Oruro, Bolivia, is an active administrative and trading centre and an export facility for the Chuquicamata copper mine. Arica, which acts as a port for Bolivia at the end of the railroad to La Paz, supports fish meal plants and oversees the agricultural production of the Azapa Valley. Once the automobile assembly centre of Chile, Arica has lost its prominence as an industrial city. The only city of significance in the interior of the Norte Grande is Calama, adjacent to the Chuquicamata copper mine, the world’s largest open-pit mine. Still, the rest of the area remains picturesque. Old Indian towns, scattered oases, and spectacular desert scenery attract tourists. At the Shrine of La Tirana, on the Tamarugal Plain, Indian and mestizo pilgrims from northern Chile, Bolivia, and southern Peru gather for a colourful festival each July.

The extreme south encompasses three natural units: the Chiloé island group, the Channels region, and Chilean Patagonia and Tierra del Fuego. Chiloé and its neighbouring islands are among the most undeveloped regions of the country; rudimentary agriculture and algae (used in making confectionary products) and shellfish gathering are the main activities. The small towns of Castro and Ancud are the main population centres of the mostly rural habitat. The Channels region is characterized by islands, separated by glacially carved channels, where colonization has been unsuccessfully attempted since the 1920s. Outlying towns such Puerto Aisén and Coihaique are the only population centres. The region of Magallanes, hinged on the Strait of Magellan, is the most developed area of Chilean Patagonia and Tierra del Fuego. Sheep raising estancias (ranches), which have exported wool since the late 19th century, and oil and natural gas, which have been exploited since 1945, are the pillars of its economy. These activities, combined with meat-packing plants and the trading functions of Punta Arenas, have made this one of the more modernized parts of Chile.

The economy

The Chilean economy is based on the exploitation of agricultural, fishing, forest, and mining resources. Chile developed historically on the basis of a few agricultural and mineral exports, as was common in Latin America. Many manufactured products had to be imported, and land, wealth, and power were concentrated in the hands of a small aristocracy. Although there were land reforms and development of manufacturing, many of Chile’s economic problems in the 20th century were related to the country’s early economic structure.

During the 19th century the Chilean economy grew on the basis of exported agricultural products, copper, and nitrates. After the nitrate market dropped during World War I, Chile’s economy took a sharp downturn, intensifying the effect on the country of the Great Depression. These events turned Chile toward more socialistic programs that featured strong government control of the economy. An attempt was made to develop import substitution industries so as to lessen dependence on imported products. Industrial growth was placed in the hands of the Corporación de Fomento de la Producción (Corfo; the Development Corporation). Agrarian reforms were instituted, and the government assumed greater control of industry, especially during the administrations of Pedro Aquirre Cerda (1938–41) and Salvador Allende Gossens (1970–73), when many banks, copper mines, and business firms were nationalized. The economy at first improved under these policies, inflation going down and the gross domestic product increasing. The government, however, was unable to establish a sound tax base to match the expanding economy; by 1973 conditions were deteriorating rapidly and a military coup overthrew the government. The new regime instituted more conservative, free-market programs and reversed many of the previous governments’ acts. The country faced severe economic problems, reflected in periodic high inflation, fluctuating trade policies, unemployment, and heavy dependence on a single major export, copper, in an unstable market. The development of a broader export economy improved economic growth and reduced inflation in Chile by the 1990s. The country also entered into many bilateral and regional trade agreements, which further increased direct foreign investment in Chilean industry. By the early 21st century, Chile had one of the most successful economies in South America.


A geographically varied country, Chile is rich in mineral deposits, natural forests, sea resources, and energy sources.

Mineral resources, noncarboniferous

Mining, historically the mainstay of the Chilean economy, has been a catalyst for both external commerce and domestic industrial development. Copper, molybdenum, iron, nitrates, and other concentrated minerals make up a large part of the total value of national exports.

Metals account for the highest percentage of mining exports, copper being primary. Chile is the world’s largest producer and exporter of copper. Copper mines are located in northern Chile (Chuquicamata and El Salvador) and along the Andes of north-central Chile (especially El Teniente and Andina). Small-scale extractions are carried out by individuals, or pirquineros, who operate in the uplands of north-central Chile and in the coastal ranges of central Chile. Medium-sized activity is conducted by companies with larger investment capacities and with their own treatment plants. Large-scale mining was developed with U.S. capital at the beginning of the 20th century.

Copper plays the role in the Chilean economy that was occupied by nitrates prior to World War I. The large U.S. corporations were tranformed into mixed-ownership enterprises during the late 1960s and totally nationalized during the early 1970s, when mining and sales were turned over to the Corporación Nacional del Cobre de Chile (Codelco). A drop in world market prices influenced production and sales and created financial hardship. During the 1990s the government enacted new laws to open up the industry to private companies, but the majority of copper mines in Chile are still controlled by the state (Codelco). By the early 21st century, demand for copper had risen, and copper accounted for about two-fifths of export income.

Iron-ore mining in El Tofo and El Romeral, both in north-central Chile, is significant, and manganese, silver and gold, and molybdenum (a metal derived from the large copper deposits) are also mined. Among nonmetallic minerals, sulfur, gypsum, lithium, and limestone are moderately exploited. Nitrate deposits occur in the northern interior desert. Their economic value, so important during the 19th century, has decreased, but the production of iodine, a by-product of nitrate, is of major importance.

Energy resources

Hydroelectric potential and installed capabilities, as well as coal and moderate oil and natural gas reserves, furnish Chile with good energy resources. The steady flow of the Andean rivers has been used by the Empresa Nacional de Electricidad (ENDESA; National Electric Company) to produce electricity. Hydroelectric development has been extended to the coastal mountain ranges. Prior to the installation of Chile’s huge hydroelectric system, most of the country’s energy was obtained from soft coal, mined since the 19th century in the Gulf of Arauco, south of Concepción. Oil and natural gas are extracted on Tierra del Fuego and along the northern shore of the Strait of Magellan and are shipped to refineries in central Chile. Production, however, meets only about half of the country’s oil needs.

Forestry resources

South of the Bío-Bío Biobío river, climatic conditions favour the growth of natural forests. The primary species used for lumber and paneling are the coigue, oak, rauli, ulmo, tepa (laurel tree), and monkey puzzle tree. Pine for the manufacture of paper and pulp is taken from forests in central Chile and the Bío-Bío Biobío region.

Fishing resources

Since 1974, after the collapse of the Peruvian fishing industry, Chile has become the chief fishery of South America, and it is one of the foremost fishing countries of the world. Sardines, jack mackerel, chub mackerel, hake, and anchovy constitute most of the catch. The principal products are fish meal and fish oil, which are shipped to Europe and the United States for the production of animal feed and industrial oil. The fish-processing plants—all privately owned—are mainly located in the northern cities of Iquique, Arica, and Antofagasta.


While good climatic conditions and abundant water resources favour Chile’s agriculture, outdated land-tenure patterns, managerial ineptitude, and inadequate price policies have combined to make agriculture one of the most inefficient sectors of the economy. Employing approximately one-sixth of the labour force, agriculture generates less than one-tenth of the gross domestic product. To meet expenditures and credit payments abroad, the military government that took over in 1973 strongly encouraged exports of agricultural commodities by private national and international companies. Within the framework of this policy, Chile increased remarkably the export of fresh fruit, canned vegetables, and wines.

In temperate central Chile the primary crops are cereals (chiefly wheat), followed by grapes, potatoes, corn (maize), apples, beans, rice, and a variety of vegetables. Industrial crops, such as sugar beets and sunflower seeds for cooking oil, are also common.

Stock raising has been one of the most underdeveloped activities in rural areas, partly because of poor technology and inefficient breeding. Cattle are the major livestock. There has been, however, some expansion in poultry, lamb, and pork production, as well as that of beef.


An estimated one-seventh of the economically active population is employed in manufacturing, which accounts for about one-sixth of the gross domestic product. Factories are concentrated in the principal urban centres—Santiago, Valparaíso, and Concepción. Light industries produce appliances, chemical products, food products, textiles and clothing, and construction materials.

Larger industrial complexes are located at the San Vicente harbour of Concepción; they include the Huachipato iron and steel mill, fish-processing factories, and a petroleum refinery associated with a petrochemical complex. Another such refinery is situated in Concón, at the mouth of the Aconcagua River. Pulp and paper mills thrive in the vicinities of the Bío-Bío Biobío and Laja rivers.

Trade and finance

Chile’s principal markets for mining and agricultural commodities are the European Union, the United States, and Asia. Most imports are from Argentina, the United States, Brazil, China, and Germany. The balance of payments, generally unfavourable since the 1950s because of increased foreign expenditures and payment of external loans, showed occasional improvement after 1976 but with considerable fluctuation. In the early 2000s Chile signed many free-trade agreements, including one with the United States that was implemented in 2004. Nontraditional exports (seafood, fruit, wine, wood products, foodstuffs) also contributed to economic growth in the early 21st century.

The peso is the national currency of Chile. The Central Bank of Chile, established in 1925, is the official bank of the country; it implements the internal banking policies of the government and also conducts foreign trade. In 1989 the bank became an autonomous institution entirely responsible for the country’s financial and exchange-rate policies. The State Bank of Chile is also a state entity, but it functions as a private commercial bank. National private banks as well as international banks from Europe, the United States, and Asia operate freely in the country.

Within the Chilean economic system there is collaboration between the private and public sectors, with the private sector contributing an increasing percentage of the total annual investment. Private businesses are generally organized as joint-stock companies (similar to U.S. corporations) that participate in all areas of economic activity.


The country’s length and physical barriers constrain communication and traffic flow. Only the sea offers an expeditious means of transportation, which was taken advantage of during the 19th century when Chile owned one of the largest merchant fleets in Latin America. Chile’s overall economic decline during the early 20th century and the supplanting of maritime transport with overland means resulted in the reduction of the fleet. Eventually only international transport was conducted by ship. The main port of entry is Valparaíso. San Antonio, the port for Santiago, exports copper and agricultural commodities. Other ports, such as Antofagasta and Arica, serve the trade with Bolivia. Chañaral, Huasco, Guayacán, and Tocopilla export minerals. The port of Talcahuano serves the industrial complex of Concepción.

The development of an overland transportation system began with two railway systems initiated about the turn of the 20th century: the northern network, between La Calera (near Valparaíso) and Iquique, now in disuse, and the southern network, between La Calera and Puerto Montt. The most traveled sections connect Santiago with Valparaíso and Santiago with Puerto Montt; both sections are electrified, making them more competitive with road transportation. The railway system is controlled by the Empresa de los Ferrocarriles del Estado (State Railway Enterprise). International railroads connect Arica and La Paz (Bolivia), Antofagasta and Oruro (Bolivia), and Los Andes and Mendoza (Argentina). A railbus transports passengers over the short route between Arica and Tacna (Peru).

Chile’s rapid motorization has brought enhanced highway transportation for passengers and goods. The backbone of the Chilean road system is the paved Pan-American Highway, which connects Arica with Puerto Montt, near Chiloé Island, a distance of more than 2,100 miles. From this main artery secondary routes connect numerous cities, including Santiago, with the ports of San Antonio and Valparaíso, Bulnes with Concepción, and Los Lagos with Valdivia. The most important international paved road connects Santiago with Mendoza (Argentina). All-weather roads connect Iquique with Oruro (Bolivia), Antofagasta with Salta (Argentina), La Serena with San Juan (Argentina), Osorno with San Carlos de Bariloche (Argentina), and Punta Arenas with Río Gallegos (Argentina).

Air transport serves mostly the cities at both extremes of the country and some towns of difficult access, such as El Salvador and Coihayque. The main airline is Línea Aérea Nacional de Chile (LAN; National Airline of Chile). A tourist service is maintained by LAN between Santiago and Easter Island, in the Pacific, with the flight continuing to Papeete, Tahiti. All major South American lines, plus others from the United States and Europe, handle the flow of international passengers to the Arturo Merino Benítez airport near Santiago. Chacalluta, northeast of Arica, is another major airport.

Precolonial period






Colonial period





Struggle for independence






Chile from 1818 to 1920



The conservative hegemony, 1830–61



Economic prosperity



Political diversification



The widening of liberal influence, 1861–91


Political factions


European influences



The War of the Pacific (1879–83)




Political development, 1891–1920


Growth of the middle and lower classes



Formation of new political parties




Decline of the ruling class



Chile after 1920
Political uncertainty, 1920–38



Effects of the world depression



Return to constitutional normality


The Radical presidencies, 1938–52


The presidencies of Aguirre Cerda and Ríos




The presidency of Gabriel González Videla




Political stagnation, 1952–64



The presidency of Jorge Alessandri Rodríguez



New political groupings



A period of change, 1964–73


The presidency of Frei Montalva



The socialist experiment




The military dictatorship, from 1973







Chile in the 21st century



