Mining companies to benefit from updated FTA between Canada and Chile

Canadian Prime Minister Stephen Harper and Chilean President Sebastian Piñera signed yesterday an agreement to upgrade the free trade deal between their two nations, which will benefit several miners with presence or planning to explore in the South American country.

In a news release published after the meeting between Harper and Piñera, the Chilean government said that the Canada-Chile Free Trade Agreement (CFTA), in place since 1997, would now include a financial services chapter that will help give Canadian financial institutions preferential access to the Chilean market. The clause would also benefit mining companies with investments in the country.

Canada is already the world’s largest investor in Chile’s mining sector and the two leaders said they welcome a growing diversification of investment in other sectors beyond mining, including financial services, energy and infrastructure.

According to the Chilean-Canadian Chamber of Commerce, Canadian investment in the South American country reached $13.3 billion in 2010 and two-way trade was estimated at $2.7 billion in 2011.

An earlier study published by the same organism says that in 2002 Canadian mining companies operating in Chile generated over 22,000 jobs in mining operations and nearly 20,000 industry related positions.

Some of Canada’s biggest mining companies have operations in the South American country, including Teck Resources Ltd. (TCK.B) Barrick Gold Corp. (ABX) Kinross Gold Corp. (K), Quadra Mining Ltd. (QUA) Yamana Gold Inc. (YRI) and geothermal power producer Magma Energy Corp. (MXY-T).

Harper also secured Chile’s support for Canada’s bid to enter negotiations for the Trans-Pacific Partnership trade agreement, as Chile is one of the nine countries involved in the trade agreement with the U.S, Peru, Australia, Malaysia, Brunei, New Zealand, Vietnam and Singapore, currently being negotiated.

(Photo courtesy of the Government of Chile’s Press Office)