Before departing on this trip, I thought of entrepreneurship much like I would imagine many of my fellow millennials do. I imagined technology startups in Silicon Valley, trendy logos on repurposed buildings in Austin, and Magnolia Farms-adjacent restaurants that charge far too much for avocado toast. Of course in my mind, I know that entrepreneurship not only expands beyond the common millennial examples, but also entrepreneurship is not limited to the creation of an enterprise. It is a mindset that can be honed, perhaps like a science, but also it is an art, sometimes perplexing to the brightest of minds. In Chile, I was able to witness a business environment that was at times just like comparable cities in the United States, while also in a different place all at the same time. Almost more European in nature in some barrios, Santiago and the surrounding areas offered beauty and economic vibrancy that surprised me, while the rural areas still presented a lifestyle that seemed to be yearning for an economic boom—but perhaps limited by the context it exists in.
One of the characteristics of Chile that we learned on the way in was that Chile, alongside Uruguay, has a reputation of low corruption, particularly in comparison to Latin American peers (The Santiago Times, 2018). Additionally, despite Brazil’s economic strength in GDP gained by its sheer size, Chile has the highest per capita GDP in South America (World Atlas, 2018). Like many, if not most, countries around the world, mobile phone usage and network coverage was ubiquitous in Chile. For many of the students on the trip, this meant a certain sense of comfort, although perhaps at slower speeds, as well as safety, stuck with them throughout the experience. For residents of Chile, this means access to essentially every online resource that we have here in the States. I definitely discovered that the level of adoption in-country varied by product. Instagram, for example, was widely used, as was Yelp and Google Maps. Etsy, though, a strong tool for entrepreneurially (and craftily) minded Americans, was largely unknown to many of the entrepreneurs we consulted with in Santiago. As is common worldwide, there was a regional alternative to Etsy, but it was nothing near the service that Etsy is, and it was not largely in use.
Though the Chilean government and economic system is stable and fairly capitalistic, there are challenges with economic inequality. I remember standing at the feet of the Virgin Mary statue in Santiago, and on one side of the large hill, I looked out at the tallest building in South America, the Gran Torre Santiago. On the other side of the hill, in the shadow of the statue, I saw what we might call a slum. Our hosts warned us to avoid those neighborhoods. Even in rural areas, the economic and structural stability appeared greater than that of countries such as Nicaragua, Honduras, Mexico, and Guyana, which I’ve visited in recent years. In some locations, both urban and rural, without the Spanish “hint,” you might suppose you are in the U.S. or Western Europe. It was hard to judge if the barrios peligrosos were nearer to the favelas in Brazil or a “bad neighborhood” in Houston. We did not explore such risks to find out. Nonetheless, there are many in Chile aspiring for a way into the middle class or upward. Like the current situation in the U.S., where the middle class may be shrinking with capital absorption into the upper class, Chile struggles to overcome the “two Chiles” situation, where some prosper, while the rest live like the rest of Latin America, just perhaps in a more temperate climate (COHA, 2011). The question then is whether the presiding class care. One could argue that, like the capitalistic “Chicago Boys,” whose transferred knowledge from the States brought a certain sense of economic opportunity to Chile, Chile’s current leadership embraces the notion that fertile soil for business is fertile soil for the people. In providing significant economic benefits to entrepreneurs abroad, through initiatives like Startup Chile, the government invites innovation and business opportunity to its shores, but whether the capital remains in Chile (or creates opportunity for those without), is of course up to the fundamental debates of capitalism and mixed economies. One of the challenging aspects of advising the local entrepreneurs was running up against laws that governed the entrepreneurial actions of many of the aspiring businesspersons we met. Even a man who sought to follow our advice and list some craft items on Etsy worried that he would essentially operating outside the law, as the Chilean government asks any business owner, however they so define it, to go through the appropriate processes. What the U.S. might treat as a hobby or self-employment, the Chilean government seems to have interest in at least mildly regulating through certain barriers to entry. This created limitations for local entrepreneurs who were not postsecondary educated on the facets of enterprise. For younger, tech-savvy entrepreneurs at the startups, and for both domestic and international college students and graduates, I could imagine the system, particularly through various state-sponsored grants, competitions, and incentives, was favorable for business opportunity.
Copper is Chile’s largest export, but recent volatility after a period of growth preceding the Great Recession has given Chile’s business and government leaders reason to find additional stability in other markets (InfoMine, 2019). Even in early 2019, Chile has found a downturn in copper exports due to varying demand worldwide (Trading Economics, 2019). The government has invested largely in other markets, such as salmon production, to avoid challenges that other mineral-dependent countries, such as Zambia, also largely reliant on copper production, have found. But like the UAE, looking forward towards an eventual future where oil reserves are not as plentiful, Chile looks towards tourism as another source of additional economic production. Chile, its beef-famous neighbor Argentina, and Uruguay have all seen recent boosts in tourism, as European and American travelers, along with wealthier Latin American sojourners, realize that the southern part of South America offers diverse landscapes, European architecture, fine cuisine, and a sort of safety and stability, particularly in Chile and Uruguay, that are not usually, in fairness or otherwise, associated with Latin America. In Santiago, we witnessed signs of the booming tourism, with a clearly present dining infrastructure, from fast food to tapas and fine dining, as well as a modern public transportation system, conveniently synced up with Google Maps. In more rural areas, particularly south of Santiago, the beauty and boutique infrastructure exists for increased traffic, but the names and attractions are not household in the English-speaking world, so some sectors rely on wealthy Latin Americans, versus those from beyond the continent. With countless camping spots, breweries, distilleries, bakeries, and antique shops, the more rural parts of southern Chile would largely satisfy Romance-speaking tourists from Western Europe, though English availability varied outside Santiago. Even still, with a growingly affluent Latino population in the U.S. and rising wealth in some areas of Mexico, Panama, and other places, Chile has an opportunity to set itself apart as the Spanish-speaking brother to Canada, New Zealand, and Norway, known worldwide for their mountainous scenery at the edges of the world.
Back in Santiago, and in the nearby arid areas, Chilean wines offered a particular quality (that did not particularly continue with U.S.-bought products of Chilean origin) that adds to its both export and tourism prospects. With unique varieties of wine grapes thought once to be lost, the climate and volcanic-rich soil offer growth opportunity for the Chilean wineries that have long played second-fiddle to their neighbors to the east in Argentina. In visiting Concha y Toro, our group experienced a wine tour that was professional, beautiful, and entertaining. Though not distributed in the U.S. as a particularly prestige wine, their large-scale operation should be a pillar of any group trip to the Santiago area.
Chile has the tall buildings, the historic architecture, the education infrastructure, the public transportation, the widely available internet access, relative safety and stability—what, then, separates Chile from its next step in growth? One economic example can be found in the services of Uber in Santiago. Uber sits in a semi-legal state, somewhat akin to the U.S. legal battles over cannabis, often in some states decriminalized or tolerated but still not federally legal. Uber is widely used in Santiago, with thousands of reviews for some drivers, but still it is not technically legal. Locals told of taxis luring Uber drivers to places and beating them. Some police officers allegedly lured Ubers to offer citations. Though New York City has seen some aggressive situations between taxi drivers and their opponents, the stories seemed more in line with other tales in less stable countries such as Brazil or Mexico. Does the government actually want to acknowledge Uber? I took one taxi in Santiago, and I paid so much for such a short ride that it was no wonder that Uber maintains its grey-area-supremacy. I would argue that Uber can continue to exist in its liminal status, and, except perhaps for some tax revenue, the government avoids offending taxi drivers, who seem to fend for themselves, and the city’s modern populace and increasing tourists can still access one of the world’s growingly ubiquitous transportation services. I believe anytime someone from the U.S. steps into a different context where people look and speak differently, particularly in the “post-Taken” world, there is a fear that the next Uber-ride or the next flight or the next (fill in the blank) is going to be the perilous one. But while in-country, I only witnessed highly vetted drivers with hundreds of reviews carrying out generally positive service.
Chile is in a political and economic position to take leadership in the Spanish-speaking-West, both in terms of economic growth and visual presence. The country is beautiful, diverse, and littered with natural resources. Many of the challenges that hold back larger players, such as Brazil, or even rival-Argentina, seem absent or less in degree in Chile. Their economy once almost looked like modern China—controlled by militaristic rule, but in most senses capitalistic. Now the country has pivoted to something more American. Trickle-down economics are adopted in a certain sense. Positive business environments and opportunities for direct government investment in enterprises and individuals makes Chile a promising starting point for new businesses. I believe the challenge for Chile is to its future advantage. Chile, for all its cultural diversity and fluency, is largely Hispanic in its orientation. Spanish is the language of choice. For now, English is the dominating language of world business, and perhaps it will remain so, but Spanish is a growing player or world linguistics. Mandarin Chinese and Hindi-Urdu represent huge population growths, but when looking at business-use feasibility and cross-national relationships, besides English, and ahead of French, Spanish is surely an important piece of the near-future of Western business growth. Chile has that certain consumer confidence, relative transparency, and free-market opportunity to lead now and in the near future. With violence in Mexico and growing pains elsewhere in Latin America, Chile’s stability and its slow growth from quasi-capitalistic dictatorship to democracy positions it as a real economic and entrepreneurial player for the next decades. Whether agua con gas will spread as a trend to places like the U.S., that remains to be seen, but Topo Chico would assuredly love the opportunity.
Chile drops two spots in corruption index. 2nd most transparent in Latin America. (2018). The Santiago Times. https://santiagotimes.cl/2018/02/22/chile-drops-two-spots-in-corruption-index-2nd-most-transparent-in-latin-america/
Historical copper prices and price chart. (2019). http://www.infomine.com/investment/metal-prices/copper/all/
The inequality behind Chile’s prosperity. (2011). COHA. http://www.coha.org/the-inequality-behind-chiles-prosperity/
The richest countries in South America. (2018). World Atlas. https://www.worldatlas.com/articles/the-richest-countries-in-south-america.html
Chile exports. (2019). https://tradingeconomics.com/chile/exports