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Miami-Chile Annual Report: No. 9 trade partner Chile posts big trade gains

July 27th, 2006

Free trade pact lifts commerce between Chile and South Florida by 23 percent.

Chile’s free trade accord with the United States had a clear and dramatic impact on South Florida in 2005 as bilateral commerce between the Miami Customs District and the South American nation leaped 23 percent.

South Florida’s trade with Chile reached $2 billion last year, up from the $1.6 billion posted in 2004. Exports exceeded imports, leaving South Florida with a $763 million surplus.

Since the U.S.-Chile Free Trade Agreement entered into force on Jan. 1, 2004, tariffs have been lifted on 90 percent of U.S. exports to Chile and 95 percent of U.S. imports from Chile. In 2005, Chile and the United States overall registered $11.9 billion in bilateral trade, an increase of more than 42 percent from a year earlier.

Among the $1.4 billion in South Florida exports to Chile, four of the top five commodities were technology-related products. The fifth was automotive parts.

Some $189 million in computers and $139 million in computer parts led the list, with the latter spiking nearly 43 percent in value when compared to 2004. Exports of transmission devices for cell phones and computer chips were also up dramatically.

Automobile parts swelled a more modest 8 percent to end the year at $54 million. And the $17 million in exports of cargo vehicles reflected a 158 percent gain from a year earlier.

Exports of tractors from South Florida more than doubled to close the year surpassing $22 million while shipments of heavy construction machinery, including bulldozers, levelers, excavators and scrapers, rose nearly 45 percent. In Miami, Chilean Trade Commissioner Cecilia Arroyo said U.S. exports of capital equipment are in demand because of infrastructure projects in the coastal cities of Concepcin and Valparaso and in farming areas.

On the import side, seafood continued to reign supreme. The Miami Customs District imported more than $424 million in fresh, frozen, salted and smoked salmon, tilapia, tuna and trout in addition to crab and other crustaceans. Salmon farms have become an important export driver in Chile and it was not a surprise that salmon made up the bulk of Miami’s fish imports; South Florida took in $329.5 million in Atlantic and Danube salmon, up 24 percent from $267 million in 2004.

Fresh fruit, the second most valuable import, totaled nearly $50 million. Floridians bought nearly $29 million-worth of cranberries, blueberries, raspberries and mulberries grown in the South American country; cranberries and blueberries accounted for the bulk of the imports, worth nearly $21million. South Florida also imported nearly $13 million worth of apricots, cherries, peaches and plums; $5.1 million in figs and avocados; and $1.4 million in strawberries. Citrus fruits, apples, pears and grapes were also among top imported commodities.

Chilean wood, used mostly for home construction and hurricane-related repairs, proved an important import. Several categories of wood products came into South Florida, together valued at $39 million.

Imports of Chilean wine increased by 21 percent to nearly $19 million. Red wine accounted for 80 percent of imports. Other important Chilean imports included corn, fruit juices, refined petroleum and men’s suits.

Arroyo said U.S. imports likely would have been higher if it weren’t for Chile’s appreciation of the peso against the U.S. dollar. The Chilean peso is currently valued at 530 pesos per dollar. Two years ago, it was 700 pesos to the dollar.

Manny Mencia, Enterprise Florida’s vice president of international trade and business development said Chile’s free trade pact reflects the benefits that both countries receive from open commercial exchange. He said Florida-origin exports to Chile have risen 45 percent since the trade agreement went into effect and that they were up 20 percent in the first quarter of 2006, compared with the first three months of 2005.

Chile is also in the process of negotiating free trade deals with China and Japan.