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DAVID KRUSE

By Staff | Jan 4, 2013

I, like most other Americans, had limited knowledge of Chile before visiting the country. I was impressed with the state of economic development and the attitude of the people in general.

I was told that Chile was no longer a developing nation, but an emerging nation by Chileans expressing great pride in their country.

Their president intends for Chile to reach developed status early in the next decade and I believe that they will achieve that or there will be a good reason why they fall short.

They are all about improving things, they appear to have a good sense of right and wrong that is lacking in Argentina, and they don’t look to grow off the sweat and equity of others.

They appear to lack some of the Latin resistance to investment in the future. Private home ownership is encouraged and subsidized by the government.

What they say is lacking is good education and health care systems.

The students and teachers have been on a prolonged strike in Chile demanding quality education. Their last president left office as her term expired with an 87 percent approval rating. The current president is a billionaire businessman who is also popular. There is no corruption by comparison to Argentina and it is much safer to walk the streets of Santiago than Buenos Aires.

A business acquaintance had to spend several weeks in Santiago and at the time I felt sorry for him. Boy, was I misinformed. He was living large.

Santiago subway and tunnels all have withstood the test of major earthquakes. Santiago is a modern growing city with the construction cranes swinging that you did not see in Argentina. Chile’s peso is a strong one.

Santiago is settled in a large valley with ski resorts 1 1/2 hours into the Andes and beaches 1 1/2 hours way in the other direction on the coast. They will take American Express and pretty much every other form of currency – except Argentine pesos.

Inflation in Chile is officially under 2 percent, but unofficially may be twice that. They have had a strong 5 to 7 percent growth rate. They don’t confiscate wealth. There are still some wounds left from the Pinochet fascists, but they are healing. They do not color their history or deal in illusion.

Chile is long and narrow country and there is no major connective highway running the length of the country.

If you want to go to Santiago from Punta Arenas in the south you must drive through Argentina. Chile is about adapting.

When the Panama Canal opened, ships no longer transited the Magellan Strait needing to be supplied. Chile is the world’s second largest exporter of salmon behind Norway and one of the world’s largest exporters of fruit, some of which seasonally reaches local stores in Iowa.

While extremely environmentally conscience, mining is a huge economic sector there and they have the lithium for our batteries.

Southern Chile has plains of Cerrado not unlike what exists in Brazil, but cold and unimprovable, utilized for grazing sheep at one lamb per 2.5 hectares.

This is year-around grazing representing conditions for organic production. The organic lamb goes to Europe. As I mentioned, the climate has warmed so that cattle have joined sheep. Hereford is the primary breed using year-around grazing with no harvesting of supplemental hay. The ranges are privately owned.

There is risk. Several years ago they experienced what they described as a “snow earthquake” receiving 6 to 9 meters of snow in one major event. That is meters not feet or inches. 90 percent of some herds of sheep were lost. When we hear of Patagonia, most Americans think of Argentina.

However, 70 percent of the Patagonian glaciers are in Chile.

One of the best kept secrets is the Chilean National Park called Torres Del Paine. Glacier National Park in the U.S. is likely the closest comparison, but Glacier doesn’t have much for glaciers anymore. Only 150,000 people a year visit Torres. In my opinion, it is right up there with Glacier or Yellowstone without the crowd.

I was told that Germans top the nationality of tourists there. Americans are missing something. Visitors are international. Amusingly, our tour guide said that he has to be careful who he matches together. He can’t put Germans who operate on German time with Brazilians who have never been on time to anything in their lives.

Instead of lions and tigers and bears, “oh my,” Chile has llamas and condors and penguins, “oh boy.”

As I have traveled the world, the real test is after visiting someplace, do you want to go back? In Europe the only place I would want to go back to is Scotland, specifically the Isle of Skye.

I would go back to Chile. I never would have guessed that before now.

David Kruse is president of CommStock Investments Inc., author and producer of The CommStock Report, an ag commentary and market analysis available daily by radio and by subscription on DTN/FarmDayta and the Internet.