Economy & Business - July 2021

CHILE | Positive economic indicators despite pandemic. Despite having one of the most efficient vaccine rollouts in the world, Chile has also suffered a surge in coronavirus (Covid-19) cases this year which forced the government to reinstate lockdowns and cast doubt over the domestic economy’s incipient recovery [EB-21-06]. However, a series of economic indicators for the month of May point towards a solid performance despite the ever-present virus. On 1 July, Chile’s central bank (BCCh) released the latest figures for the index of economic activity (Imacec), which exhibited 2.6% growth month-on-month and a strong 18.1% expansion year-on-year in May. The previous day, data released by the national statistics institute (INE) showed that the unemployment rate is improving, falling to 10% in the March-May rolling quarter, down from 11.2% a year earlier and 10.2% in the December 2020-February 2021 rolling quarter. Meanwhile, other data released by INE show a strong year-on-year performance in the industrial sector, with industrial production growing 3.5% in May, and in the retail sector, with the index for commercial activity growing 47.6% year-on-year that month. This strong year-on-year performance across different sectors and indicators is in part due to the low basis of comparison, resulting from the economic shutdown in place in May 2020 as a result of the Covid-19 pandemic, as well as the better adaptation of households and businesses to the effects of the public health crisis.

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