Codelco vs. private mining: contributions to Chile’s revenues

The state-owned copper company, Codelco, is the world’s largest copper producer, as well as Chile‘s largest company.

While Codelco contributed $2.3 billion to government revenues in 2022, private mining contributed $4.6 billion in 2022.

Under Chilean law, Codelco’s net profits are subject to a 40.0% excise tax, in addition to the corporate income tax generally applied to domestic companies and paid by its private sector competitors.

Codelco

In addition, as a fully state-owned company, Codelco contributes all of its net income to the central government budget through profit transfers.

In 2018, 2019, 2020, 2021 and 2022, government revenues from copper totaled $1.7 billion, $3.7 billion, $1.3 billion, $5.8 billion and $2.2 billion, respectively.

Also, according to the Chilean government, copper exports accounted for approximately 79.1% of all Chilean mining exports in 2022.

Mining

Chile has large reserves of metallic and non-metallic mineral resources and is the world’s largest copper producer.

In 2022, Chile recorded estimated copper reserves of 190 billion metric tons, representing 21.3% of world reserves, and produced 5.2 billion metric tons of copper.

Chile also has large quantities of iodine, coal, gold, silver, nitrate, iron ore and molybdenum.

Consequently, the mining sector contributes significantly to Chile’s export sector and GDP.

While non-manufacturing mining exports are recorded in the mining sector, the mining production process is included in the manufacturing sector.

In the 1990s, the mining sector grew driven by increased investment, including the opening of new large mines.

By 2021 and 2022, this sector accounted for 14.4% and 14.2% of GDP, respectively.

Mining products in 2021 and 2022 accounted for approximately 61.4% and 57.3%, respectively, of Chile’s total exports, totaling approximately US$58.2 billion in 2021 and US$56.5 billion in 2022.