Chile's Arabs play key role in boosting trade talks

Santiago: Chile's Arab community is playing a vital role in the progression of trade talks between the UAE by assisting the Chilean food industry with applications for halal certification.

An estimated 800,000 Arabs live in Chile, which has long provided refuge to those caught up in conflicts in the Middle East.

Now the community is able to give something back to the South American nation through assistance in trade ties with Arab nations starting with the UAE, which has the potential to become a distribution hub for Chilean exports across the Gulf Cooperation Council (GCC).

Chile has 21 Free Trade Agreements (FTAs) with 57 countries, but to date none of these trade tie-ups are with the Arab world, despite the fact that Chile is rich in products the region depends heavily upon, such as cheap agricultural imports.

Exports to the UAE in particular exceeded $107.7 million (Dh395 million) last year, but that still ranks the UAE as 44th in Chile's list of export destinations, with tariffs of five per cent on most products deterring trade.

Agreement

Carlos Salas, Chilean trade commissioner to the UAE, said, "If we can secure an FTA with the GCC — a region not strong in food production — we can improve Chile's top global exporters ranking from 17th to 10th by 2020."

Proposals for an FTA with the GCC have already been submitted six months ago and Andres Rebolledo Smitmans, the director to bilateral economic affairs at the Chilean Foreign Ministry in Santiago, estimates the whole process will take three years.

Smitmans said: "A six month feasibility study could start as early as the first semester of 2010, with a trade negotiation phase of two-years to follow."

In the meantime, "Chile Week" a major promotional campaign showcasing Chilean products and trade opportunities took place recently.

Culinary experiences featured highly at the event with the food industry projected to experience most growth in Chile's export portfolio. Second only to copper mining (60 per cent), the food sector made up almost 20 per cent of Chile's global industrial exports last year, $12.44 billion (Dh46 billion) worth of goods ranging from fruit and seafood to meat and livestock.

By 2010 the food industry is projected to exceed 30 per cent, making it the sector most capable of growth and stability in Chile's economy.

Food

But, naturally any trade agreement with an Islamic country whereby food makes up a large and growing portion of export requires halal certification, something Chile lacks.

This is where Chile's Arab community comes in. An accredited non-profit Islamic Centre in Chile must be officially recognised by the General Secretariat of Municipalities in Dubai to issue halal certification before exports can begin.

Mohammad Said Rumie, the General Secretary of Chile's Islamic Centre in Santiago, confirmed that the centre had sent a file documenting the standards of their halal processes to the GSM and was awaiting accreditation. "The process should take just a matter of months."

A delegation of Emirati officials is likely to tour food production plants before the end of the year. Rumie added: "We don't just intend to certificate meat production plants in Chile but also propagate halal into all food exports, including fruits and vegetables from the tree to storage facilities.

Preservatives

"Halal is as much about the ‘haram' preservatives that go into our food as it is about being a specific method of slaughter. And as Dubai's halal accreditation standards are very high we are confident of achieving accreditation with other potential Arab markets."

Any profits made from the halal process go straight back into community programmes to help Palestinian refugees in Chile, 117 of whom arrived as recently as April 2008 from refugee camps on the Syria-Iraq border. Jorge Dacarrett, director of the Chilean Arab Business Council, attributes the push for better Arab trade relations to the Chilean Arab community.

"Since 2005 the Arab community here in Chile has lobbied the government and private sector to put the Arab world on the agenda."

Dacarrett added: "Five per cent of leading professionals in Chile are of Arab descent and as a community we have good relations with both candidates at the forthcoming presidential election, Sebastian Pinera and Eduardo Frei Ruiz-Tagle, so the Arab trade-pact is likely to stay on course.

"With just 0.44 per cent exports and 0.23 per cent imports, it has not been an investment relationship between Chile and the UAE."