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WT/TPR/M/315 8 September 2015 (15-4605) Page WT/TPR/M/315 8 September 2015 (15-4605) Page: 1/52 Trade Policy Review Body 23 and 25 June 2015 TRADE POLICY REVIEW CHILE MINUTES OF THE MEETING Chairperson: H.E. M. Atanas Atanassov Paparizov (Bulgaria) CONTENTS 1 INTRODUCTORY REMARKS BY THE CHAIRPERSON ....................................................... 2 2 OPENING STATEMENT BY THE REPRESENTATIVE OF CHILE.......................................... 4 3 STATEMENT BY THE DISCUSSANT ................................................................................ 7 4 STATEMENTS BY MEMBERS ........................................................................................ 11 5 REPLIES BY THE REPRESENTATIVE OF CHILE AND ADDITIONAL COMMENTS ............. 43 6 CONCLUDING REMARKS BY THE CHAIRPERSON ......................................................... 50 Note: Advance written questions and additional questions by WTO Members, and the replies provided by Chile are reproduced in document WT/TPR/M/315/Add.1 and will be available online at http://www.wto.org/english/tratop_e/tpr_e/tp_rep_e.htm. WT/TPR/M/315 • Chile - 2 - 1 INTRODUCTORY REMARKS BY THE CHAIRPERSON 1.1. The fifth Trade Policy Review of Chile was held on 23 and 25 June 2015. The Chairperson H.E. Mr Atanas Atanassov Paparizov (Bulgaria) welcomed the delegation of Chile headed by Mr Andrés Rebolledo, Director General of International Economic Relations at the Ministry of Foreign Affairs; the rest of the delegation, including H.E. Ambassador Héctor Casanueva, Permanent Representative of Chile to the WTO; other colleagues from the Mission in Geneva; and the discussant, H.E. Ambassador Irene Young (Hong Kong, China). 1.2. The Chairperson recalled the purpose of the Trade Policy Reviews and the main elements of the procedures for the meeting. The report by Chile was contained in document WT/TPR/G/315 and that of the WTO Secretariat in WT/TPR/S/315. 1.3. Chile adopted the alternative time-frame for its TPR. The following delegations submitted questions one week before the meeting and had been transmitted to the delegation of Chile: Malaysia; Australia; Switzerland; Brazil; Singapore; Hong Kong, China; Peru; China; the Plurinational State of Bolivia; the United States; Canada; Chinese Taipei; Mexico; and the Republic of Korea. The following delegations submitted written questions after the deadline and had also been transmitted to the delegation of Chile: New Zealand; the European Union; Japan; Norway; Guatemala; Turkey; the Dominican Republic; Trinidad and Tobago; Ecuador and Thailand. 1.4. At the time of the previous review in 2009, Members had commended Chile's open, transparent and predictable trade regime. It had been noted that Chile had attained one of the highest income and social development indicators in Latin America, and Chile had been referred to as a model for others to follow. Despite this very positive assessment, a few areas for improvement had been identified. For instance, a number of Members had questioned Chile's price band system, and had sought clarification on the steps being taken to bring it into compliance with WTO obligations. Some concerns had been expressed regarding customs appeal procedures and Chile had been also asked to reconsider its import regime for used goods. 1.5. Now turning to the current fifth review, the Chairperson was pleased to note that the Chilean economy had weathered successfully the global crisis, supported by high commodity prices and the implementation of prudent macroeconomic policies. Although structural reforms had been implemented in several areas, Chile's economy continued to be heavily dependent on copper and agricultural exports. As a consequence of this dependency, but also of high energy costs and low productivity growth, GDP growth had decelerated since 2012 as copper prices had fallen and investment in mining had decreased. GDP growth for 2014 was estimated at 1.9% reflecting declining investment and an appreciating currency; however, more recent estimates indicated higher growth for 2015 albeit still below Chile's potential. The authorities had reacted to lower growth by easing the monetary stance so as to lower interest rates, which had resulted in a depreciation of the peso. Chile had also reformed its tax system to improve tax collection. The reform was expected to increase revenue by 3% of GDP by 2018 allowing Chile to return to a situation of fiscal surplus and to finance the reform of the educational system and other social policies. 1.6. Chile's trade and investment regime continued to be, on the whole, open, transparent and predictable. As a result of its accession to the OECD, Chile had undergone regulatory and institutional reform in several areas. In addition, an Energy Agenda had been established to serve as a roadmap for formulating and implementing a long-term energy policy, and a Productivity, Innovation and Growth Agenda had been launched. These and other reforms had been conducted in consultation with the private sector, which supported the Government's main policy thrust. Chile considered foreign investment as an essential engine of growth, and an integral part of its open economic policy. Investment flows had been substantial during most of the period under review (2009-2014), particularly in the area of mining. Chile was in the process of reviewing its foreign investment regime, and several Members had raised questions on the impact that the new regime would have on existing and future investment flows. 1.7. Chile considered bilateral agreements as a key instrument to improve market access for its products. Reflecting this, Regional Trade Agreements (RTAs) had continued to play a central role in Chile's trade strategy. Since 2009, Chile had concluded several RTAs; in 2013, these had covered WT/TPR/M/315 • Chile - 3 - some 98% of Chile's trade. At the same time, Chile remained strongly committed to the multilateral trading system, in which it participated actively. 1.8. Chile was in the process of implementing measures to facilitate customs procedures. A Single Window for export procedures was in place and full implementation of the Single Window for imports was envisaged for January 2017 at the latest. Chile had also pursued unilateral trade liberalization during the period reviewed, including the elimination in 2012 of its highest tariff rate of 12.5% which had applied to some animal products. Currently, Chile's MFN tariff consisted of two rates: 0% and 6%, with exceptions for some agricultural products which were subject to the price band system. The price band system remained unchanged since 2009 and applied to: wheat, wheat flour and sugar. In the course of this review, Chile had noted that during 2009-2014 the applied tariff rate for these products had been 0%. 1.9. Chile managed several incentive programmes to promote exports, including drawback, export credits and guarantees. Other incentive schemes were implemented to promote regional development, SMEs and technological innovation. The effect of these programmes had never been evaluated and there were no estimates of revenue foregone due to their application. Some Members had raised questions with respect to these regimes and their WTO status. 1.10. Chile had continued to strengthen its legal and institutional frameworks in the areas of TBT and SPS, government procurement, competition policy and intellectual property rights. With respect to SPS, Chile had passed legislation to strengthen SPS requirements for aquaculture and fisheries products after facing a sanitary crisis in 2009. Draft legislation on competition to make mandatory the notification of mergers and acquisitions above a certain threshold, to increase penalties for breaches of the competition law, and to enhance the investigative and enforcement powers of the Competition Authority had been submitted to Congress. In government procurement, open tendering was mostly used, and no preference margins were granted to domestic suppliers. 1.11. These were only a few of the topics that have been touched upon in the over 320 questions raised by Members. Other issues highlighted by Members included: export promotion, financing and support; incentives; State-owned enterprises; fisheries legislation; competition in the telecommunications market; and national treatment issues in maritime transport, among others. 1.12. The Chairperson was sure that these topics and themes, and many more, would be touched upon in greater detail at the deliberations on the first and second day of the meeting. 1.13. The Chairperson closed his introductory remarks by wishing Chile a very successful fifth Trade Policy Review. He looked forward to its active engagement in this TPR. 1.14. He also noted that a podcast would be made of the meeting which could be accessed on the Members' website. WT/TPR/M/315 • Chile - 4 - 2 OPENING STATEMENT BY THE REPRESENTATIVE OF CHILE (MR ANDRÉS REBOLLEDO) 2.1. I should first like to express my gratitude for the introduction made by the Chairperson of the Trade Policy Review Mechanism, Ambassador Paparizov, and to all delegations that have helped to make this review a success. I am also grateful for the work done by the Secretariat to deliver a full report, which has been of great utility in this exercise. Our gratitude and appreciation go also to the Permanent Representative of Hong Kong, China, Ambassador Irene Young, for serving as discussant in this review. For Chile, this is a very important opportunity in its trade policy as regards its growing international role in recent years. We are here with a sizeable
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