Chile


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Chile is the largest copper producer in the world, with 5.5 million tons produced in 2010. Mineral exports accounted for nearly two thirds of total exports and forty percent of gross domestic product in 2011.


Chile's Performance on the Resource Governance Index

Chile ranks 8th out of 58 countries and received a score of 75 indicating a "satisfactory" level of governance. Very strong performance on the Enabling Environment, complemented by satisfactory scores on the Institutional & Legal Setting and Reporting Practices, offset the relatively weaker assessment of Chile's Safeguards & Quality Controls.

Rank
(out of 58)
Score
(out of 100)
8 Composite Score 75
14 Institutional & Legal Setting 77
Freedom of information law 67
Comprehensive sector legislation 100
EITI participation 0
Independent licensing process 100
Environmental and social impact assessments required 50
Clarity in revenue collection 100
Comprehensive public sector balance 78
SOC financial reports required 100
Fund rules defined in law 100
Subnational transfer rules defined in law N/A
10 Reporting Practices 74
Licensing process 67
Contracts 0
Environmental and social impact assessments 50
Exploration data 50
Production volumes 100
Production value 100
Primary sources of revenue 67
Secondary sources of revenue 25
Subsidies 0
Operating company names 100
Comprehensive SOC reports 100
SOC production data 100
SOC revenue data 93
SOC quasi fiscal activities 100
SOC board of directors 100
Fund rules 100
Comprehensive fund reports 100
Subnational transfer rules N/A
Comprehensive subnational transfer reports N/A
Subnational reporting of transfers N/A
21 Safeguards & Quality Controls 65
Checks on licensing process 67
Checks on budgetary process 56
Quality of government reports 67
Government disclosure of conflicts of interest 0
Quality of SOC reports 50
SOC reports audited 100
SOC use of international accounting standards 100
SOC disclosure of conflicts of interest 0
Quality of fund reports 100
Fund reports audited 100
Government follows fund rules 100
Checks on fund spending 100
Fund disclosure of conflicts of interest 0
Quality of subnational transfer reports N/A
Government follows subnational transfer rules N/A
6 Enabling Environment 87
Corruption (TI Corruption Perceptions Index & WGI control of corruption) 90
Open Budget (IBP Index) 93
Accountability & democracy (EIU Democracy Index & WGI voice and accountability) 81
Government effectiveness (WGI) 84
Rule of law (WGI) 88
Satisfactory Weak
Partial Failing
To explore all data and compare
scores, use the RGI Data Tool.

Institutional & Legal Setting (Rank: 14th/58, Score: 77/100) learn more

Chile's laws and systems generally encourage integrity and openness, resulting in a "satisfactory" score of 77. The licensing process is clearly defined in the Mining Code and concessions are granted by court resolution on a first-come, first-served basis. The Mining Ministry regulates the sector, while the Finance Ministry collects payments from companies and deposits all revenues in the national treasury.

Environmental impact assessments are required. In 2008 Chile adopted a Transparency and Access to Public Information Law for all public agencies. However, the law does not cover mining companies.

Reporting Practices (Rank: 10th/58, Score: 74/100) learn more

Chile earns a "satisfactory" score by providing access to comprehensive information about its extractive operations and revenue. The Finance Ministry regularly publishes information on production volumes, prices, mineral export values, royalties and special taxes. The Mining Ministry publishes information on mineral reserves, production volumes, prices and mineral export values, but provides no data on revenues. The Chilean commission on copper publishes information on reserves, production volumes, prices, value of mineral exports, production costs, companies operating in the country, production data by company, production stream values, special taxes and dividends.

While licensing petitions and environmental impact assessments are published, contracts with mining companies are not.

Safeguards & Quality Controls (Rank: 21st/58, Score: 65/100) learn more

Chile's "partial" score of 65 can be explained by three factors. First, a legislative commission comments on mining laws but does not review contracts or oversee the licensing process. Second, Finance Ministry statements are audited by the Comptroller General, who reports to the legislature, but lawmakers do not conduct comprehensive reviews of resource revenues. Third, government officials with a role in overseeing the mining sector are not required to disclose their financial interest in extractive activities.

Enabling Environment (Rank: 6th/58, Score: 87/100) learn more

Chile rates very high on corruption control, budget transparency, government effectiveness, voice and democratic accountability, and the rule of law. The key complementary measures needed to achieve good resource governance are in place.


State-Owned Companies (Rank: 10th/45, Score: 84/100) learn more

Owned by the government, the national copper corporation, CODELCO, produces more copper than any other company in the world. It publishes audited financial statements and annual reports with information on reserves, production volumes, prices, value of exports, investments in exploration, production costs, operating companies names, production data by company, quasi-fiscal activities, production stream values, special taxes, dividends, bonuses, acreage fees and its board of directors.

Natural Resource Funds (Rank: 4th/23, Score: 88/100) learn more

In 2007 the government replaced the Copper Stabilization Fund with an Economic and Social Stabilization Fund designed to insulate the national economy from global market fluctuations by accumulating excess revenues during times of high copper prices. The Finance Ministry manages the fund and regularly publishes information on its assets, transactions and investments. The ministry also publishes rules governing deposits and withdrawals, along with audited financial statements.

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