So, we've heard today a lot about energy

security, resilience, investment flows.

Um so, I'm looking forward to getting

into that. But, of course, just to

introduce you, I think maybe to to to

the audience, you came to office in

March

um of this year as Minister for Foreign

Affairs serving President Kast,

um who's of course seen as an important

ally of Donald Trump in Latin America.

So, later on, maybe we can talk about a

little bit about regional um politics

um and global politics. But, before all

of that, um

you're here at least partly you're going

to ASEAN after this, but you're also

here partly to bang the drum for this

idea of Choose Chile. Can you tell us a

little bit about your Choose Chile

project?

>> Okay. I mean,

one of the missions that

I have from the Foreign Ministry is to

help the country recover growth. And

this is an old idea that I I got from

President Macron when I was sitting in a

board of French company some some years

before the the pandemic. He started with

the program called Choose France. And

one of the things we need to do in in in

the in the case of Chile is to be able

to compensate what we don't get from

mining

minerals in terms of the rest of the

economy. And

the key element there is human capital.

And we need to somehow push the rest of

the economy up. And the idea that popped

in my mind was, why don't we borrow the

this this concept that the French had

had designed to invite investors and I

not only investors, but also people to

go to Chile and see whether they can

they can operate out of there either

their industrial or or businesses, but

also I mean, the the professions. So, if

we if we can we can

get people to choose Chile, uh maybe we

can compensate for what we're not

getting out of critical minerals.

Uh we have a little bit of the Dutch

disease in in in in our country for some

time. We used to grow at rates well

above the average uh, world growth

rates, 5 6, 7%. Today we are below that

and this has has been going on for 12

years. And one of the things that we we

wanted to do

coming into office was to go back to

where we used to be and

we need help. We need

human capital basically. We're going to

generate it over time through education,

but that's not enough.

That's the whole concept behind Just

Steel.

>> And just just very briefly, when people

think of Chile, they think of copper or

they think of lithium, but where are

you? What sorts of other industries are

you hoping to attract?

>> Well, we have other industries already

in in in in in in the country. We're

we're very very large food exporters,

also paper and pulp, fish,

salmon and probably sure some of the

people in the audience have tried

Chilean salmon. We compete with Norway

there.

It's a very unique thing about Chile

because not many places in the world can

do that. But still this is not enough.

And

that's why we we came up with this idea.

Uh,

uh,

we we need to

the spill overs of the industries that

we have developed are not enough for the

rest of the economy.

Uh,

just to give you an idea, I mean, the

way the mining industry works is you you

grab workers from all over the place.

You take them into Antofagasta, they fly

in. They pick up a bus, they go to the

mining camps, they stay there for 10

days and go back home

10 days later. Just to return a few I

mean

a week

uh, after that. So the the the the the

the spill over of the other industries

that have to benefit from this

development are not are not getting

enough. So what we need to do is to

bring more

talent and so that we can add

what you would say

value added to the product we're doing

downstream investments that will allow

us to not only

do what we're doing, but more.

>> Mhm.

And Japan and in Asia, Japan and China

obviously the biggest investors in in

Chile. Where do you see this extra

investment coming from other particular?

>> Well, our our

largest investor into this Canada.

Actually the number two is the US.

Japan is also very important. China is

not so not so important in terms of

investments. They're they're our biggest

trading partner. They're the most

significant importer of of our goods. So

we trade a lot with China around about

40% of our trade is with China.

But of course investments

the Canada US and

Europe come come come come first.

>> And you know as discussed copper is is

obviously your biggest export.

Which when you look at Asia which Asian

markets do you think realistically can

absorb more of your copper?

>> Now of course

copper is linked to to the energy

transition.

And also to electromobility.

So the industrial

footprint is very important. So far

probably if you if you forecast copper

going forward some people say that

three four years down the road we're

going to have scarcity of

of of this mineral. Chile is investing

heavily with with the numbers are around

about 100 billion dollars for the next

10 years.

And and of course it's highly

concentrated because we we and we need

to to expand the number of places where

there are there are buying copper from

us. For that purpose we need to move

away from from concentrate and starting

exporting refined copper. That implies

changing a little bit the footprint of

smelters in in the region not

necessarily in Chile but in other in

other markets like Europe the US or even

Latin America. And

probably China will continue to be a

very significant

client for our copper because of the

industrial footprint they have. But as

as data centers or as they call today AI

factories start to spread out around the

world well of course, the the the demand

for for copper will be more widespread.

>> And and right now, how are you seeing

the demand for copper?

>> Very strong.

>> Yeah.

>> Very very strong, yeah.

Uh

the amount of investments are going to

into AI and and

and data centers is huge. Of course,

that implies energy.

And energy has to be transported. The

electrons travel through copper. This is

the highway from from the generators to

the to the places where the

energy is consumed. And that's a very

very important thing for for our

product.

>> So, I'd like to talk a little bit about

um

Washington. So, you were recently in

Washington and

>> That was a couple of weeks ago.

>> Marco Rubio and other US officials.

Um as you partly I guess as you seek to

protect your exporters from from from

tariff measures.

But what what did you take away from

those conversations and how concerned

should Chile be about the the future

direction of trade US trade policy?

>> I think that

one of the things that is clear to me is

that after COVID, the trust in the in

the supply chain that we have built

after globalization was challenged.

Uh probably the the way

goods and services were distributed

during the the COVID period were not in

proportion to market shares of of demand

before COVID. And that generated some

anxiety and and the need or at least

the thought that at least that uh

countries needed to be more uh

self-sufficient. Uh

And that generated a shift in terms of

the of the of the production of of goods

and services around the world.

And I I think personally that this is

it's a trend that is here to stay. Uh

and uh so, the globalization will will

switch to what I call a probably

friend-shoring.

And uh what we're going to see start

seeing is probably clusters of countries

pulling together

uh free market arrangements within

themselves so that they can And then

basically compensate for the fact that

this global market that we used to have

will will

be more problematic going forward. The

last time that this happened in the

world was in the 1930s of of the of the

last century. It lasted for 40 years. So

I I don't think it's I think this time

we'll we'll we'll see this trend for a

while.

So that is why it's so important to to

travel to to visit our our trade

partners to talk to them and to see what

opportunities are there that we can

exploit so that we can compensate and

somehow

not lose the efficiencies that we were

able to to generate through trade. In

this search for for more security.

>> Mark Carney in his in his now famous

speech in Davos talked about the need

for the middle powers and perhaps also

smaller powers to find their allies and

to group together in the sort of you

know shifting

shifting world that we find ourselves

in. Who do you see as Chile's natural

partners?

>> Well, our natural we we have a free

trade agreements with 90% of world's

GDP.

Or

so we have a very large base of

partners. Now, when we look at what

we've done in the last 40 years, we

haven't changed much our matrix of

exports. 40 years ago we were exporting

basically minerals and a few other

products.

Today we're in terms of size much larger

than

in terms of what we export, but still

50% more or less the same products. What

has happened is what we have

concentrated our client base. In for 40

years ago 20% of our exports went to

Europe. Today it's less than 10.

5% China represented less than around

5%. Today it's close to 1/3.

So I so when you we we have the the the

client base there, but we haven't been

able to exploit our our our our ability

to to to sell products to them neither

in terms of the diversification of the

client base nor in the diversification

of number of products. So what we have

to concentrate now is to make sure that

we're able to

expand our our our clients and also

expand our our the pros we sell them.

And and for that we need to start moving

I mean

using our feet.

Contracts or or treaties are not enough.

They're just a starting point. So we

need to travel more, we need to invite

more

our our our friends to go visit us. We

need to see whether we can where can can

we cooperate in terms of what they do

and we do.

And that's that's a challenge today to

to be able to

do more with our with our friends.

>> When you talk with US trade officials,

obviously we are in a the Trump

administration is is very very different

to the other administrations that have

preceded especially

around trade. You were telling me before

we came on stage that you studied in you

studied in Chicago. So you are a student

of of of of of free markets. But you

know there's a lot of talk about how

aggressive this administration is and

how difficult it can be to deal with.

When you're in a room with them,

do you find that they listen

>> Yeah, they certainly listen. I mean I I

what I know about trade I learned from

them. So I mean and and basically free

trade was the name of the game if you

wanted to increase output. That's the

most efficient way to to to do things.

The cost of what you of what you produce

I mean or what you substitute is what

you you had stop doing in order to

substitute certain the things you're

importing. So it's it's come come it

comes from the in from inside. And and

so the the the normal trend is is is to

say well I'm going to specialize in the

things I do best and I'm going to import

from from from you the things that you

do best.

I mean I have a a trade deficit with my

the guy that cuts my hair.

What should I care about that?

So and the the same holds true for

because I have a surplus with others.

And I

don't and and don't start cutting my

hair to avoid a trade deficit with my

So that's the rule and everybody knows

that.

Now on the other end

there was the perception that

trade was not fair. In what sense?

You certainly

tariffs were fine. I mean

zero tariffs were perfectly but there

are other things behind the scene that

can can influence what you're able to

import or export.

And and

the the since I think the feeling was

that the world was not being fair.

And I get that the perception that the

US felt that they weren't being treated

fairly in in in in the way they were

were able to offer their products

abroad. Now whether that's true or not

it's it's hard to tell but if you look

at the the

the US economy you you know that they're

basically at full employment.

Unemployment is only 4% so whatever

they're not doing in terms of goods

they're doing in services. But

if you go back again to that's why I

think it's so important to go back to

the the COVID days. If you go back to

the COVID days probably the sensation

that was generated there is that if you

weren't able to manufacture at home what

you needed in a crisis you were

vulnerable. And and that's that's there

to stay for a while and and I think that

to some extent what we're living now is

precisely the sensation that that the

countries need to be or the countries

need to be

secure in terms of what they they can

they can produce for themselves. Now

when you have a smaller size countries

like Chile or Singapore

we can't we cannot do everything. So

this is why it's so

with the same logic it's so important to

generate the coalitions of

countries or markets that can help

themselves and can decide what are we

going to do ourselves and what are we

going where we're going to

import from you, but on one condition.

If something bad happens that we I'm

going to be I'm going to fairly sell to

you what do you have been buying from me

and you're going to supply to me what

I'm I've I've been buying from you.

You're not going to We're going to keep

the rules of the game even though we may

face a difficult time. So, I think

that's that's something that you can

work out in in in smaller groups and uh

we have of course several several trade

agreements and and within the group

within different groups of the Pacific

for example and this is something that

we have to sit down and talk so that we

can

substitute in a way what we're going to

lose by this shift away from

globalization.

>> Mhm.

>> [snorts]

>> I've got one more question for you on

your sort of discussions with with with

Washington. I mean is China are you

actively looking for exemptions or

carve-outs or broader bilateral

understanding with the with the US?

>> Well,

>> Of course, there is a close

relationship, you know, between the two

countries and the two presidents, you

know, share some well, have some

similarities in terms of

>> Well, we have a trade agreement with the

US and that as they have with others,

this thing is being renegotiated on this

new

scenario and and we have to sit down and

and

and and discuss what how we're going to

get out of this of this

uh

issue. Let me give you an example of of

of things that happen and sometimes the

devil is in the details. We export

chicken to the US, but we import chicken

from the US as well and we had a we have

a a trade a a trade equilibrium in

chicken.

Uh because they like to eat the breast

and we like to eat the

the legs.

Uh

and and more as we export to them as

many kilos of breast as we import from

them kilos of legs. I mean, what sense

does it make? We shouldn't we have zero

tariff for that? Mhm. we we And And uh

that's It's a true story, by the way.

And And this is This are kind of things

that we have to look at. Or for other

another example,

they they eat fruit and we produce

fruit, but we are we're off-season with

what they produce. Again, that's a

That's a win-win for us and for them.

So, there are lots of details that we

can we can eventually

sit down and talk about them and and and

and and make sure that we can

still benefit from trade. So, we can

continue eating the chicken legs and

they can continue eating eating the

>> I didn't I didn't expect to be talking

about chicken diplomacy here on

here on stage, but but it is what it is.

We live in strange times.

We're coming We're coming close

to the end

of our time, but you know, you mentioned

earlier China, of course, is your

biggest trading partner. You also have

this very important strategic political

relationship

with the United States.

How is Chile managing that juggling act?

And how do you plan to manage that

juggling act?

>> Well, we we have to

Again, we are

a small country. We have to export to

everybody. We trade with everybody. We

have to be friends with everybody. And

we don't have to choose. They're

complementary. And we want to continue

doing business with with both of them.

China is very important for us in terms

of exporting goods and and

minerals. They're also very important in

supplying from to us a lot of a lot of

goods that are basically very convenient

for us. The US, on the other hand, is a

very important strategic partner. We we

import from them a lot of services. We

export to them lots of goods. And

we need them both. So, that's that's

that's the way we we're going to develop

ourselves. We're going to trade with

everybody.

>> You said you don't have to choose, but

have there been any moments where you

felt like you're you're being forced to

choose or

one of

one of those powers is going going you

to choose?

>> No, no, I I don't I we haven't felt that

way. Uh and of course the other

negotiation sometimes implies that you

bluff.

Uh but

well, we we can play poker as well. So

and and and

one important thing to to to give in

mind is that negotiating is not the art

of giving arguments, but the art the art

of building up options.

>> Mhm.

>> And that's that's where it's a very

important for us to expand our client

base. As as I was telling you, if you go

40 years down the road, we're exporting

to a larger base than we are today. So

we have to expand our

our client base. That's Michael Porter

101. I mean, diversify your your your

client base.

And we're working hard to do that. And

we we were not we went to India I mean

like a month ago, we started

conversations with them. We're going to

negotiate a free trade agreement with

with India. We're talking to all of our

our neighbors to expand our to modernize

and and and expand our our our free

trade agreements with them. And but now

talking specifically about things that

can happen. And this is a very important

element so that we don't we're not

pressured to to to accept the idea that

we have to choose.

>> Mhm.

>> Uh so

the art of the the art of the deal. We

have to be there every day and and very

importantly working with our the private

sector. They come with us to the to the

trips and and they sit in the on the

table. They talk to to their their their

potential clients. So

for example,

we were in Indonesia yesterday. We went

to visit a an

salmon importer with one of the Chilean

producers. And that's the kind of thing

we're we're doing. We're using our feet

to solve the problem.

>> Salmon, chicken does more to Chile than

copper, obviously. So

>> Uh exactly. Correct. But probably the

one thing we want to do is move into the

into the digital era. AI is very

important. We're lots of

we're getting a significant investment

in in in data centers and things like

that. But but that salmon and we'll will

to be imported.

>> All right, Minister. Thank you so much

for joining us today. Thank you.

Thank you all.