Chile’s new right-wing government said it is focused on improving the performance of state copper giant Codelco, rather than trying to introduce private capital or sell assets.
“The ownership of Codelco is established in the Constitution, and any change would require a national decision that transcends any particular government,” declared the Minister of Finance, Jorge Quiroz. “For now, we are focused on improving performance.”
Quiroz and the Minister of Economy and Mining, Daniel Mas, spoke on Monday at Codelco’s annual general meeting, the last of President Máximo Pacheco’s four-year term. Both ministers have criticized the company’s results, marked by falling production, rising debt and a fatal accident last year.
When asked about the possibility of selling assets, Mas indicated that this would be a decision of the board of directors, in accordance with corporate governance regulations, and not of the government. Subsequently, Pacheco clarified that the company’s main deposits cannot be sold or incorporated into companies, although, in principle, non-strategic assets could be subject to review.
Previously, Quiroz questioned Pacheco about what he described as a lack of self-criticism and whether the company’s prospects could be trusted after past disappointments.
Pacheco stated that the company learned from past mistakes, including overly optimistic goals, managing large projects under a centralized approach, slow decision-making and excessive dependence on outsourcing.
Production is stabilizing and the project pipeline is now more realistic after previous mistakes, Pacheco said, rejecting suggestions that the company is in crisis.
“We have learned to be humble, and it has been a hard and painful process,” the president said.
Codelco’s growing debt, which totaled $25 billion last year, reflects its role as a state company that transfers profits to the government, Pacheco said. adding that liabilities would be about a fifth of current levels if it operated as a private company.
According to him, it is likely that the company will have to continue borrowing in the coming years to finance its investments.
The government plans to announce three new members of Codelco’s board of directors in the coming days, including Pacheco’s replacement.
