Chile - ConstructionChile - Construction
In contrast to Chile’s economic slowdown in recent years, the construction sector grew by 4% in 2018, with imports of construction machinery and equipment reaching $900.3 million during the same period. Sector investment is projected to grow by 4.5% during 2019 according to the Chilean Chamber of Construction, CCHC (Cámara Chilena de la Construcción), recovering after three consecutive yearly negative growth figures, a dramatical decline from 11% growth in 2012. President Sebastián Piñera’s administration is keen on boosting construction, especially related to infrastructure, and the sector should continue to grow during the next years through private and public investment, reaching a total of $ 160 billion (2019-2027), covering three main areas:
- Base Infrastructure: Water resources; Energy; Telecommunications
- Logistics Infrastructure: Inter-urban roads; Urban roads; Airports; Ports; Railway roads; Logistics
- Social Use Infrastructure: Public Spaces; Hospitals; Jails; Education
All the above mentioned will require intense use of construction machinery & equipment.
Infrastructure projects are financed with direct state investment as well as public/private partnership resources. The country has a large portfolio of pending infrastructure projects related to transportation since there is a need in several areas such as ports, airports and highways. Among the areas with major investment requirements for the 2019-2027 period are urban roads and highways, totaling $60 billion; telecommunication infrastructure (expansion of fiber optics, and coverage of remote areas) for $25.3 billion; and water infrastructure (transportation and storage), for $18.3 billion. A parallel road to the country’s main highway Ruta 5, which runs north/south, is projected to begin construction by 2022.
The importation of construction machinery and equipment decreased by 2% between 2016 and 2017, but grew by 25% between 2017-2018, and is expected to continue growing during 2019. The U.S. is the single largest supplier of machinery and equipment, mostly with heavy machinery, high-tech building materials and capital equipment, followed by Germany, China, and Italy.
Building materials from the U.S. have a high reputation, and are in demand, but U.S. companies must be aware that the market is small and very competitive. Construction standards continue to be improved, especially related to regulations covering insulation, energy efficiency, doors/windows, sustainability, and ‘green’ construction. The high cost of energy (the highest in Latin America), fosters the need to use energy efficient materials incorporated in projects design.
Arcadis’ Sustainable Cities Index ranks Santiago number one as the most sustainable city in Latin America. According to Chile Green Building Council, GBC Chile, Chile has 197 LEED certified buildings, and 438 total LEED activities (including certified and ongoing projects). The public consciousness of sustainable practices and support for investment in green infrastructure, engineering and construction is high. In 2016, Chile started its “National Program for Sustainable Production and Consumption”, which includes sustainable construction. The program involves the Ministries of Public Works, Housing & Urban Development, Energy, Environment, Mining, Health, Economy, Finance, and Agriculture to jointly incorporate and design the local concept of sustainable construction, production and consumption to achieve an overall sustainable environment. A cooperation agreement between the U.S. GBC and the Chile GBC was signed in February 2018.
(total market size = (total local production + imports) - exports)
Leading Sub-Sectors
Chile manufactures very limited and basic types of construction equipment, mostly mining related. Most of the equipment is imported, and U.S.-made products are highly regarded by Chilean buyers. Imports from the U.S. account for 26% of the market, followed by Germany: 11.5%, and China: 9.5%. Chinese equipment continues to increase its presence in Chile.
Energy Efficiency
The best opportunities for U.S. exports are for those products that offer high levels of efficiency and that can work on reduced operational costs, replacing expensive labor. Since the cost of energy in Chile is very high, energy efficient machinery is an excellent sales advantage. The most promising are in areas such as earth moving equipment, concrete technology for high-rise building construction (scaffolding, concrete pumps), and supplies and consumables that accelerate the building process.
Building Materials
Building materials used in green building are good prospects, especially those that add points for LEED and other certification. ‘Green’ and ‘sustainable’ are key words within the Chilean construction sector. Renewable energy equipment related to construction (commercial, industrial and housing), insulation products, heating systems and air conditioning systems are important considerations in current construction projects. The local market is open to new and high-tech products; however, it is a small and very competitive marketplace.
Opportunities
Public Works, Infrastructure: urban and inter-urban roads and highways, airports, ports, hospitals, jails, etc.
Mining, energy & general industry related construction
Private sector buildings (offices, hotels, first & second homes, mountain, country, lake and beach resorts)
Retail, especially shopping malls
Educational and private health facilities
Industrial facilities
EXPO EDIFICA / CONEXPO Latin America / Expo Hormigón will take place in Espacio Riesco, October 2021
The local trade shows Expo Edifica (main local construction show) and Expo Hormigón (Cement Construction Show), will collocate with AEM’s Conexpo Latin America for the second time in Chile. This even is the most important in the construction industry sector and brings together exhibitors and visitors from Chile, Latin America, North America, Asia, and Europe.
Web Resources
Ministry of Public Works, Ministerio de Obras Públicas, MOP
Ministry of Housing and Urbanism, Ministerio de Vivienda y Urbanismo, MINVU
Chile GreenBuild Council (Chile Chapter), Chile GBC
Chilean Chamber of Construction, Cámara Chilena de la Construcción, CCHC
Technology Development Corporation (part of CCHC), Corporación de Desarrollo Tecnológico, CDT
Institute of Cement and Concrete, Instituto del Cemento y del Hormigón, ICH
Association of Engineering Consultants, Asociación de Empresas Consultoras de Ingeniería, AIC
Association of Architecture Firms, Asociación de Oficinas de Arquitectura, AOA
For additional information, please contact CS Chile Commercial Specialist, Mary L. Lathrop, Mary.Lathrop@trade.gov.
Prepared by our U.S. Embassies abroad. With its network of 108 offices across the United States and in more than 75 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.
- Base Infrastructure: Water resources; Energy; Telecommunications
- Logistics Infrastructure: Inter-urban roads; Urban roads; Airports; Ports; Railway roads; Logistics
- Social Use Infrastructure: Public Spaces; Hospitals; Jails; Education
All the above mentioned will require intense use of construction machinery & equipment.
Infrastructure projects are financed with direct state investment as well as public/private partnership resources. The country has a large portfolio of pending infrastructure projects related to transportation since there is a need in several areas such as ports, airports and highways. Among the areas with major investment requirements for the 2019-2027 period are urban roads and highways, totaling $60 billion; telecommunication infrastructure (expansion of fiber optics, and coverage of remote areas) for $25.3 billion; and water infrastructure (transportation and storage), for $18.3 billion. A parallel road to the country’s main highway Ruta 5, which runs north/south, is projected to begin construction by 2022.
The importation of construction machinery and equipment decreased by 2% between 2016 and 2017, but grew by 25% between 2017-2018, and is expected to continue growing during 2019. The U.S. is the single largest supplier of machinery and equipment, mostly with heavy machinery, high-tech building materials and capital equipment, followed by Germany, China, and Italy.
Building materials from the U.S. have a high reputation, and are in demand, but U.S. companies must be aware that the market is small and very competitive. Construction standards continue to be improved, especially related to regulations covering insulation, energy efficiency, doors/windows, sustainability, and ‘green’ construction. The high cost of energy (the highest in Latin America), fosters the need to use energy efficient materials incorporated in projects design.
Arcadis’ Sustainable Cities Index ranks Santiago number one as the most sustainable city in Latin America. According to Chile Green Building Council, GBC Chile, Chile has 197 LEED certified buildings, and 438 total LEED activities (including certified and ongoing projects). The public consciousness of sustainable practices and support for investment in green infrastructure, engineering and construction is high. In 2016, Chile started its “National Program for Sustainable Production and Consumption”, which includes sustainable construction. The program involves the Ministries of Public Works, Housing & Urban Development, Energy, Environment, Mining, Health, Economy, Finance, and Agriculture to jointly incorporate and design the local concept of sustainable construction, production and consumption to achieve an overall sustainable environment. A cooperation agreement between the U.S. GBC and the Chile GBC was signed in February 2018.
| 2016 | 2017 | 2018 | 2019 (Estimated) | |
| Total Local Production | 110.0 | 110.0 | 110.0 | 115.0 |
| Total Exports | 92.3 | 72.8 | 58.6 | 83 |
| Total Imports | 685.5 | 671.8 | 900.3 | 920 |
| Imports from the US | 170.3 | 196.8 | 234.3 | 250 |
| Total Market Size | 703.2 | 709.0 | 951.7 | 952 |
| Exchange Rates | 680 | 649 | 641 | 676 |
Leading Sub-Sectors
Chile manufactures very limited and basic types of construction equipment, mostly mining related. Most of the equipment is imported, and U.S.-made products are highly regarded by Chilean buyers. Imports from the U.S. account for 26% of the market, followed by Germany: 11.5%, and China: 9.5%. Chinese equipment continues to increase its presence in Chile.
Energy Efficiency
The best opportunities for U.S. exports are for those products that offer high levels of efficiency and that can work on reduced operational costs, replacing expensive labor. Since the cost of energy in Chile is very high, energy efficient machinery is an excellent sales advantage. The most promising are in areas such as earth moving equipment, concrete technology for high-rise building construction (scaffolding, concrete pumps), and supplies and consumables that accelerate the building process.
Building Materials
Building materials used in green building are good prospects, especially those that add points for LEED and other certification. ‘Green’ and ‘sustainable’ are key words within the Chilean construction sector. Renewable energy equipment related to construction (commercial, industrial and housing), insulation products, heating systems and air conditioning systems are important considerations in current construction projects. The local market is open to new and high-tech products; however, it is a small and very competitive marketplace.
Opportunities
Public Works, Infrastructure: urban and inter-urban roads and highways, airports, ports, hospitals, jails, etc.
Mining, energy & general industry related construction
Private sector buildings (offices, hotels, first & second homes, mountain, country, lake and beach resorts)
Retail, especially shopping malls
Educational and private health facilities
Industrial facilities
EXPO EDIFICA / CONEXPO Latin America / Expo Hormigón will take place in Espacio Riesco, October 2021
The local trade shows Expo Edifica (main local construction show) and Expo Hormigón (Cement Construction Show), will collocate with AEM’s Conexpo Latin America for the second time in Chile. This even is the most important in the construction industry sector and brings together exhibitors and visitors from Chile, Latin America, North America, Asia, and Europe.
Web Resources
Ministry of Public Works, Ministerio de Obras Públicas, MOP
Ministry of Housing and Urbanism, Ministerio de Vivienda y Urbanismo, MINVU
Chile GreenBuild Council (Chile Chapter), Chile GBC
Chilean Chamber of Construction, Cámara Chilena de la Construcción, CCHC
Technology Development Corporation (part of CCHC), Corporación de Desarrollo Tecnológico, CDT
Institute of Cement and Concrete, Instituto del Cemento y del Hormigón, ICH
Association of Engineering Consultants, Asociación de Empresas Consultoras de Ingeniería, AIC
Association of Architecture Firms, Asociación de Oficinas de Arquitectura, AOA
For additional information, please contact CS Chile Commercial Specialist, Mary L. Lathrop, Mary.Lathrop@trade.gov.