Flag description:

two equal horizontal bands of white (top) and red; a blue square the
same height as the white band at the hoist-side end of the white
band; the square bears a white five-pointed star in the center
representing a guide to progress and honor; blue symbolizes the sky,
white is for the snow-covered Andes, and red represents the blood
spilled to achieve independence
note: design was influenced by the US flag

Economy
Chile

Economy - overview:

Chile has a market-oriented economy characterized by a high level of
foreign trade. During the early 1990s, Chile's reputation as a role
model for economic reform was strengthened when the democratic
government of Patricio AYLWIN - which took over from the military in
1990 - deepened the economic reform initiated by the military
government. Growth in real GDP averaged 8% during 1991-97, but fell
to half that level in 1998 because of tight monetary policies
implemented to keep the current account deficit in check and because
of lower export earnings - the latter a product of the global
financial crisis. A severe drought exacerbated the recession in
1999, reducing crop yields and causing hydroelectric shortfalls and
electricity rationing, and Chile experienced negative economic
growth for the first time in more than 15 years. Despite the effects
of the recession, Chile maintained its reputation for strong
financial institutions and sound policy that have given it the
strongest sovereign bond rating in South America. Between 2000 and
2007 growth ranged between 2%-6%. Throughout these years Chile
maintained a low rate of inflation with GDP growth coming from high
copper prices, solid export earnings (particularly forestry,
fishing, and mining), and growing domestic consumption. President
BACHELET in 2006 established an Economic and Social Stabilization
Fund to hold excess copper revenues so that social spending can be
maintained during periods of copper shortfalls. This fund probably
surpassed $20 billion at the end of 2007. Chile continues to attract
foreign direct investment, but most foreign investment goes into
gas, water, electricity and mining. Unemployment has exhibited a
downward trend over the past two years, dropping to 7.8% and 7.0% at
the end of 2006 and 2007, respectively. Chile deepened its
longstanding commitment to trade liberalization with the signing of
a free trade agreement with the US, which took effect on 1 January
2004. Chile cl