European Union External Action

Chile and the EU

Political and economic relations between the European Union and Chile are defined by their Association Agreement, which has been in force since 2003. This Agreement covers the main aspects of bilateral relations: political dialogue, trade and cooperation.

Chile is a key partner of the EU with which the EU shares fundamental values concerning freedom, democracy and the defence of human rights. We are partners in the support of the multilateral system and we work together in the fight against climate change, to preserve our Ocean and towards the fulfillment of the sustainable development Agenda. Chile attracts substantial European investment and maintains strong cultural and historical links with Europe.

The excellent relationship between the European Union and Chile covers a wide range of contacts, coordination and dialogue in the areas of politics, trade and cooperation, which were strengthened by the bilateral Association Agreement signed in 2002.

Meetings concerning political dialogue at all levels are held regularly within the context of Association Councils and Association Committees. There is also a regular dialogue between Parliamentarians on both sides via the EU-Chile Joint Parliamentary Committee. In 2016 the institutional set-up of the Association Agreement was completed with the setting up of the EU-Chile Joint Consultative Committee.

In 2013 Chile proposed to modernise the AA. To this effect, an EU-Chile Joint Working Group on the modernisation of the Agreement was set up and completed its reflections in January 2017. On the basis of the conclusions of the Joint Working Group, the EU is preparing negotiating directives in order to negotiate a modernised Agreement with Chile.

The EU and Chile have signed a Framework Participation Agreement in January2014 institutionalising the participation of Chile in EU crisis Management Operation. Chile participates in the EU Crisis Management ALTHEA in Bosnia and Herzegovina.

Economic relations between the EU and Chile have become stronger since the signing of the 2002 Association Agreement, which represented a milestone in their international economic relations, as it was one of the most extensive, detailed and modern bilateral agreements of its time.

The flow of investments from the EU into Chile almost doubled in the first 10 years of the implementation of the agreement. The EU is also the largest foreign direct investor in Chile. Total EU FDI flows in 2015 stood at €2.3 billion, and EU FDI stocks stood at €42.8 billion. Per capita, investments from the EU into Chile are higher than in Brazil, Mexico and China combined.

In addition, in September 2002 the EU and Chile signed an agreement on scientific and technological cooperation, and in June 2005 the EU entered into a horizontal agreement with Chile concerning air transportation.

All of these agreements had positive knock-on effects in terms of innovation, technology transfer and competitiveness, among others.

The EU and Chile share a vision of the crucial role SMEs play for economic growth, job creation and innovation. Our trade reflects this: 40% of Chilean companies that export to the EU are SMEs (more than to other major trading partners).

Thanks to the Association Agreement, the EU maintains a special trade relation with Chile, which includes the liberalisation of trade in goods and services, legislation that regulates rights of establishment (investments) and mutual access to public procurements. In addition, other important issues of the trade part of the agreement include intellectual property, legislation concerning the technical obstacles to trade, as well as a chapter on customs cooperation and trade facilitation. Finally, very important are the agreements regarding sanitary and phytosanitary measures and wines and alcoholic beverages.

Since the entry into force of the Agreement between Chile and the EU in February 2003, bilateral trade has grown by 100 %. The EU was the third largest trading partner of Chile in 2016, its second largest destination for exports (after China) and the third largest origin of imports (after the United States and China).

Trade in goods

  • In 2016, the EU exported to Chile: €8.6 billion
  • In 2016, the EU imported from Chile: €7.4 billion

Exports from the EU to Chile mainly consist of industrial products such as machinery and transport equipment and other manufactured goods such as chemicals. The EU imports agriculture products such as fruit, copper and other metals and industrial products such as food, wine and cellulose from Chile.

Trade in services

  • In 2015, the EU exported to Chile: €3.8 billion
  • In 2015, the EU imported from Chile: €2.0 billion

Foreign direct investments (FDI)

  • FDI stock of the EU in Chile in 2015: €42.8 billion
  • FDI stock of Chile in the EU in 2015: €280 million

The source for all of the aforementioned figures is EUROSTAT: http://ec.europa.eu/eurostat

 

The EU and Chile have a shared interest in meeting a number of challenges both globally and regionally to ensure greater social cohesion, better opportunities and quality of life for their people and to improve integration in both regions. Chile is considered a ‘graduated’ country for the EU and a partner with a common commitment to attain the SDGs under Agenda 2030.

Potential fields of cooperation include security and defense, science and technology, research, innovation, energy, education, employment, corporate social responsibility, SMEs and their groupings, regional policy, climate change and sustainable development

Chile is starting to benefit from new cooperation instruments, such as as the Partnership Instrument (IP), established by the EU to focus on areas of strategic interest, in particular to share European expertise and to support policy dialogues.

It also benefits from the Regional Facility for International Cooperation, standing as provider and recipient in four international cooperation actions with other Latin American countries.

In the framework of the AA, a Memorandum of Understanding has been signed   to build a more strategic cooperation and differentiated partnerships with and within the region. 

Chile continues implementing thematic and regional cooperation actions in the following fields:

1. The promotion of human rights, democracy, the rule of law and good governance

In order to tackle  EU priorities and guidelines stated in the EIDHR as well as the EU Human Rights strategy in Chile, particular  emphasis will be  given to Economic, social and Cultural Rights and business  and inclusion and non- discrimination. Women and girls ´rights and gender equality will also be a priority, particularly with regard to a life free from violence and the strengthening of a culture free from gender  stereotypes. In addition, economic empowerment for women as well as political participation will also be covered.

2. Promotion of an inclusive and sustainable growth:

Social cohesion and good governance support at the regional level will be given via the EU programme Eurosocial. In the field of higher education for Chilean students, teachers and Institutions, Chile has taken good advantage from its participation in ERASMUS +. In terms of cooperation and drug prevention Chile participates in the EU regional program COPOLAD

 

The European Union in Chile maintains a strong dialogue with civil society on a broad number of issues including via the EU-Chile Joint Consultative Committee which is part of the institutional structure that oversees the implementation of the Association Agreement as well as on key areas of work such as human rights, gender equality, inclusion and non-discrimination.  The participation of civil society in the design of public policies and the respect of cultural, economic, social rights and the role of business are also priority areas for work with CSOs.

Chile is a partner in the region in the fight against climate change and benefits from, EUROCLIMA+, along with 17 other countries from Central and South America, with the objective of facilitating the design of strategies and policies for climate change adaptation and the reduction of emissions.

Complementing the work achieved by Euroclima and the launch of the EU-Chile Dialogue on Environment and Circular Economy, the EU will support 5 actions in distinct regions in Chile aimed at preventing and mitigating the effects of Climate Change (from 2017 to 2020) as well as the collaboration between mayors and their associations via the Partnership Instrument programme - the International urban Cooperation: sustainable and innovative cities and regions regional programmes.

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