381. Editorial Note
On May 5, the new Chilean copper law entered into effect. A detailed analysis of it is in Current Economic Developments, Issue No. 468, May 24, 1955, pages 13–18. “Climaxing more than a year of legislative effort and political and economic controversy,” the report noted in part, “this new measure makes a fundamental change in the statutory and administrative provisions applicable to the copper industry, which constitutes the basis of Chile’s economy. To the large American copper companies operating in Chile and producing the bulk of its foreign exchange, the law affords necessary financial relief and purports to restore control over sales of their product. By improving the treatment of invested capital and the general climate for new investments, the law provides encouragement for the modernization and expansion of the nation’s leading industry.
“Coming at a time when the competitive status of Chilean copper has been threatened, the new law holds promise of correcting this situation and safeguarding Chile’s share of world markets. Although an item of domestic legislation, the copper bill has been a matter of importance in US-Chilean relations over the past year. Its enactment into law represents a satisfactory conclusion from the point of view of the US interests concerned. The net reaction of the American copper companies is favorable; while the new law is not everything that might have been desired, it is probably as good as could have been obtained within the limitations of existing conditions. An evaluation of the practical effects of the law must await its [Page 793] application, since the degree to which its intentions are implemented in operative regulations will be the significant factor. However, the law seems to have inspired confidence on the part of the foreign copper companies, for shortly after it was signed they announced plans to spend a total of $7 million in immediate expansion and in opening up new mines. The law is representative of slow but encouraging progress on the part of Chile toward a more rational utilization of the economic resources with which it has been endowed.” (Department of State, Current Economic Developments: Lot 70 D 467)
Current Economic Developments was a semimonthly classified periodical prepared by the Bureau of Economic Affairs in the Department of State for internal use as a background and policy guidance report for policy-level officers of the United States Government serving in the United States and abroad.