MercoPress. South Atlantic News Agency

Chilean Patagonia provides few bright spots of economic activity

Puerto Montt port

The southern tip of the Chilean Patagonia provided most of the few bright spots in the Chilean government’s latest Index of Regional Economic Activity (INACER), published this week by the National Statistical Institute.

The total economic activity for the first three months of 2009 in Magallanes (Region XII), Chile’s southernmost region, increased by 17.8% relative to the same period last year. Aysén (Region XI), the remote Patagonian region south of Puerto Montt, experienced an increase of 11.6%.

For many other regions, the INACER report showed economic contraction. Nine of the 14 regions examined showed a net decrease in economic activity in comparison to the first trimester of 2008.

The economic pain from an ongoing viral epidemic in Region X’s salmon-farming industry has been compounded by a drop in demand for forestry products, and the Region experienced a decline in economic activity of 16.6%.

In Arica and Parinacota (Region XV), Chile’s northernmost region, the report showed a 14.6% drop due to lower activity in fishing and manufacturing.

The commercial sector, which declined in eight of the regions examined in the report, expanded strongly in Magallanes, supporting that region’s positive figures.

Aysén, the next most successful region in the report, benefited from an expansion of the fishing and aquaculture industries.

The new figures suggest that Aysén’s gains may be coming at the expense of its northern neighbour, Los Lagos (Region X), long the centre of Chile’s aquaculture industry.

The recent effects of environmental contamination caused by the loosely regulated salmon-farming industry have made some operations move south into the cleaner waters of the Aysén region.

Across Chile, industrial manufacturing, commerce, and transport and communications were the hardest hit sectors.

By Chris Battey - Santiago Times