Chile’s Elections and the Mining Sector
-
2025年11月26日
-
On December 14, Chileans will choose the country’s next president – and the direction of its mining industry.1 The candidates’ views on mining do not fully align with the contours of a left-right runoff. Jeanette Jara (“Jara”), current President Gabriel Boric’s former Minister of Labor and Social Provision and a lifelong member of the Communist Party,2 has acknowledged mining’s crucial role in Chile’s economy and aims to increase copper production by 10%.3 José Antonio Kast (“Kast”), the far-right frontrunner and founder of the Republican Party,4 includes water and biodiversity protection in his government plan.5 To prepare, companies are conducting scenario planning and risk monitoring to capitalize on an expected mining boom while traversing the political and regulatory uncertainty ahead.
The Communist Party’s perhaps unexpected support for mining ultimately reflects the sector’s critical importance to Chile’s economy.6 Over the past decade, the extractive industry’s share of national GDP has quadrupled, now accounting for around 15%.7 Chile is the world’s leading copper producer – at a moment when global demand is surging due to the energy transition and projected to increase by over 40% by 2040.8,9
With this backdrop, one key question looming over the elections is the future of Codelco (Corporación Nacional del Cobre de Chile). The state-owned company, responsible for roughly 10% of global copper output and 10% of the national budget,10 faces mounting pressures: a debt crisis (with maturities of around USD 1.4 billion next year),11 aging infrastructure,12 and a slow recovery following its lowest production level in 25 years in 2022.13 The presidential candidates have opposing visions: while Kast supports partial privatization to improve efficiency, Jara pushes for greater public control.
A similar dynamic plays out in lithium – another cornerstone mineral for the energy transition, in which Chile is a dominant player as part of the ‘lithium triangle’ and the world’s second-largest supplier.14 Jara proposes creating a new state-owned enterprise (the National Lithium Company) and expanding public-private partnerships to double production over the next decade. 15 Kast seeks to open lithium to private investment.16 As such, the outcome of this election carries implications beyond Chile’s mining sector, potentially shaping the global energy transition and the future supply of critical minerals.
Geopolitical Landscape
The presidential runoff occurs within an intricate geopolitical context. China and the United States are Chile’s two largest trading partners, with China serving as the principal buyer of Chilean copper.17 Chile was China’s first ally in South America, and its influence continues to expand:18 it controls roughly two-thirds of Chile’s energy sector and accounted for 40% of Chilean exports in 2023, nearly three-quarters of which were minerals.19 Relations with Washington have been pragmatic, though they were strained by the July 2025 threat of 50% tariffs on copper20 (which ultimately did not affect Chile). Both Kast and Jara are likely to pursue diversification and broaden Chile’s economic partnerships. Opportunities include deepening engagement with regional partners such as Argentina, Brazil, and Paraguay,21 as well as Asian countries including Japan, South Korea, Indonesia, and India.,22,23 However, such collaboration with other producers may be tempered by rising competition – particularly from Argentina, which is pursuing an aggressive mining expansion under President Milei.24
The current geopolitical climate presents a broad array of risks, ranging from sanctions exposure to the potential economic slowdown of key export markets.25 More specific uncertainties have emerged:
- The shifting U.S. anti-corruption framework has raised questions over the predictability of enforcement: the pause in FCPA (Foreign Corrupt Practices Act) actions from February to June 2025 signaled an “America First” approach less focused on overseas compliance,26 yet the subsequent launch of the cross-agency Trade Fraud Task Force in August (alongside the expanding designation of Latin American armed groups as Foreign Terrorist Organizations) has heightened scrutiny of importers and the potential for penalties.27,28
- ESG expectations are increasingly inconsistent. While demand for strong ESG performance grows among investors and regulators in Chile,29 a global backlash against ESG has led to regulatory rollbacks in several jurisdictions, creating the possibility of being penalized both for taking and for not taking non-financial ESG-driven decisions.30
Key Risks and Opportunities
Closer to home, companies face domestic structural risks such as rising insecurity and gang violence,31 bureaucratic bottlenecks,32 permitting delays,33 higher operating costs,34 labor shortages,35 and declining production.36 Environmental pressures are acute: for example, the Atacama Desert – one of the world’s driest regions and a critical mining hub – suffers from severe aquifer overexploitation and water scarcity, which has led to significant production cuts.37 These pressures fuel community tensions, triggering protests and land disputes.38 The election outcome will shape how these issues are managed. Kast has taken the most combative stance toward Indigenous communities, labelling violence by some groups as “terrorism” and pledging to restore full state control over territories;39 if he wins, expect heightened conflict. Jara, by contrast, has centered her platform on the climate crisis, protected areas, and formal recognition of Indigenous territories, proposing a National Council of Indigenous Peoples to guide development policy.40 Under Jara, expect stringent environmental requirements, longer consultation processes, and increased scrutiny of ESG performance.
Despite these risks, the upside potential is immense. The country has a long mining tradition, with mature regulatory frameworks, well-established operations, a stable economy, and strong institutions.41 Sustainability standards continue to strengthen, permitting processes are being modernized,42 and the country is at the forefront of innovation – from AI and automation to desalination and closed-loop water systems.43,44 In many respects, the operating environment carries fewer risks than other major copper producers such as Peru or the Democratic Republic of the Congo.45 According to the latest Mining Risk Index, Chile has been the most welcoming jurisdiction for miners in Latin America.46
For any mining company entering Chile, the horizon is long term. Over a 30-year lifecycle, much can change. Organizations that build strong monitoring, governance, and risk management mechanisms will be best positioned to capture the opportunity while minimizing exposure. FTI Consulting supports clients across these dimensions, offering enterprise risk management to mitigate threats and identify value. Our work spans market and risk assessments, site-level audits, due diligence, compliance and security programs, community engagement strategies, sustainability procedures, and risk mitigation plans, as well as support in litigation and disputes. We provide end-to-end guidance throughout the mining lifecycle. For more information, please reach out to our experts.
Footnotes:
1: Prensa CTMIN, “Ctmin: lo que está en juego para las y los trabajadores mineros con las propuestas de Jara y Kast,” CTMIN (November 19, 2025),
2: Pardo, Daniel, “Jeannette Jara, la comunista pragmática de origen popular que busca defender el poder de la izquierda en Chile,” BBC News (November 17, 2025)
3: Radwin, Maxwell, “What’s at stake for the environment in Chile’s upcoming election?”, Mongabay (November 13, 2025)
4: Ulloa, Christopher, “¿Quién es José Antonio Kast, el ultraderechista que busca ganar la segunda vuelta de las elecciones presidenciales en Chile?” CNN Latinoamérica (November 16, 2025)
5: Homepage, KAST Presidente
6: “Jeannette Jara: Programa Presidencial 2025,” CeCo Chile (September 24, 2025)
7: Ahmed, Usman, “Latin America’s Mining Boom: Opportunities and Obstacles,” AZO Mining (September 9, 2024)
8: Solomon, Daina Beth & Fabian Cambero, “World’s top copper producer Chile in wait-and-see mode after Trump tariff bombshell,” Reuters (July 8, 2025)
9: “Global Trade Update (May 2025): Focus on critical minerals – copper in the new green and digital economy,” Unctad (May 2025)
10: Hidayat, Muflih, “Chile Mine Collapse Investigation: What Happened at El Teniente,” Discovery Alert (October 8, 2025)
11: Bloomberg, “Codelco regresa al mercado de deuda global ante el repunte del precio del cobre,” La Republica (September 29, 2025)
12: De Vicente, Agustin, “Elecciones 2025 en Chile ponen en juego el futuro del sector minero,” Reporte Minero y Energético (August 1, 2025)
13: “Chile’s Codelco to meet obligations as financials deteriorate -JPMorgan,” Reuters (September 26, 2025)
14: Solomon, Daina Beth & Fabian Cambero “Chile has 28% more lithium than previous estimates, studies find,” Reuters (April 7, 2025)
15: “Two government initiatives for Chile and a mining industry that is reconsidering the tax burden,” bnamericas (November 18, 2025)
16: Harrison, Crayton, “Para Kast, el plan de Boric para el litio atentaría contra el liderazgo chileno,” Bloomberg (June 22, 2023)
17: “Chile’s Top Trading Partners: Export and Import,” Pangea by panco (accessed November 24, 2025)
18: Bartlett, John, “Copper, Pragmatism, and Going Green: A History of Chile-China Relations,” China Global South Project (March 13, 2024)
19: Brown, Martin, “One Belt, One Road, One Chilean Headache,” The Diplomat (August 15, 2025)
20: Breuninger, Kevin, “Trump slaps universal 50% tariff on copper imports; metal’s price plunges,” CNBC (July 30, 2025),
21: “How to address mining operational risk and costs in 2026: Keys for Chilean and Latam companies,” bnamercias (October 22, 2025),
22: Otero Fuentes, Marcela, “Chile en el Asia Pacífico Comercio e Integración”, FunPacifico (accessed November 24, 2025)
23: Sen, Amiti, “India’s FTA talks in Chile, Peru focus on securing supplies of critical mineral: Sources,” The Hindu businessline (October 31, 2025)
24: Dubé, Ryan, “Milei Wants to Turn Argentina Into a Mining Powerhouse,” The Wall Street Journal (November 11, 2025)
25: Chia, Osmond, “China’s economic growth slows as trade tensions with US flare up,” BBC (October 20, 2025)
26: Office of the Deputy Attorney General, “Guidelines for Investigations and Enforcement of the Foreign Corrupt Practices Act (FCPA)”, U.S Department of Justice (June 9, 2025)
27: “Departments of Justice and Homeland Security Partnering on Cross-Agency Trade Fraud Task Force,” U.S Department of Justice Office of Public Affairs (August 29, 2025)
28: “The Foreign Terrorist Organization (FTO) List,” Congressional Research Service (September 11, 2025)
29: Cardenas, Ian, “Chile’s Sustainability Shift: Unlocking New Investment Opportunities,” Harris Gomez Group (accessed November 24, 2025),
30: Ioannou, Ioannis, “What the ESG backlash reveals,” London Business School (March 31, 2025)
31: Venezuela Investigative Unit, “Safe Chile Meets Extreme Gang Violence,” Insight Crime (August 17, 2025)
32: Benitez Urrutia, Enrique, “Chile offers economic stability and clear legal framework,” China Business Law Journal (July 11, 2011)
33: Ibid.
34: “How to address mining operational risk and costs in 2026: Keys for Chilean and Latam companies,” bnamercias (October 22, 2025),
35: “Chile’s mining sector needs 34,000 new professionals by 2032 – report,” Mining.Com (February 4, 2024)
36: “How Chile’s mining industry impacts historical copper prices,” bnamericas (October 31, 2025)
37: Gonzalez, Alejandro, “Why Chile’s mines are turning to the sea,” Mining Technology (May 29, 2025)
38: Comunicaciones OPSAL, “Atacameño Communities Maintain Protest Camps in the Atacama Salt Flat and Raise Awareness about out the Environmental Impacts of Lithium Mining,” Observatorio Plurinacional de Salares Andinos (January 29, 2024)
39: Radwin, Maxwell, “What’s at stake for the environment in Chile’s upcoming election?” Mongabay (November 13, 2025)
40: Ibid.
41: Benitez Urrutia, supra note 32.
42: Jamasmie, Cecilia, “Chile cuts mining permitting times by up to 70%,” Mining.Com (July 2, 2025)
43: de Vicente, Agustin, “Chile proyecta aumentar en un 15% su PIB minero con exploración acelerada de minerales críticos,” Reporte Minero y Energético (September 25, 2025)
44: Vella, Heidi, “Innovation comes to tailings management,” Mine NRI Digital (accessed November 24, 2025),
45: Ibarra, Valeria, “Congo alcanza a Perú como segundo productor mundial de cobre y Chile mantiene primer lugar,” Diario Financiero (November 29, 2023)
46: “The 2022 Latin America Mining Risk Index”, Americas Market Intelligence (2022)
相关服务
发布于
2025年11月26日
主要联络人
Senior Managing Director, Leader of Asia and Latin America Forensic & Litigation Consulting
Associate Director