Financial services could play part in Chile's diversification

Financial services should be a key part of future efforts to diversify the Chilean economy, said BBVA Chile chief economist Jorge Selaive.

Chile continues to be heavily dependent on its mining sector and does not benefit from having diversified mining exports like several other Latin American countries, said Selaive at a presentation on the Chilean economy.

Instead, Chile has become even more reliant on copper exports, which have grown to more than 50% of its total exports from about 40% in 2007, he said.

Copper export dependence has left Chile vulnerable to China's copper demand, which is now slowing, said Selaive.

Chile should implement measures to diversify the economy, with financial services representing a good opportunity, he said.

A big obstacle for turning Chile into an attractive financial services hub is the country's human capital deficit, particularly its poor English skills, said Selaive.

A study by global recruiting firm Hays found that only 5% of Chilean professionals have a good command of English, a "very low" level even by Latin American standards.

Selaive said that the government's planned education reform could eventually reduce this deficit. He suggested the government focus resources on early education to prepare "future university students."