Chile: the balanced view : a recopilation of articles about the Allende years and after

c) Industries which, although they are not in the two preceding categoríes, have investments at such levels that they justify being put into operation; d) Industries that relate to Chile under the activities assigned to the country in the Andean Pact, particularly when these industries complement other activitie~ within the are a , or represent capital goods for the area. Of course, to the preceding criteria others must be added, íf they correspond to condítions that have not yet been well defined within the national economy -for example, the need for construction materíals. Policies involving incentives, taxes, credits, and protection will be governed by the real rJatíonal value added and employment conditions generated per unit of investment in a given industry. Furthermore, condítions as liberal as possible will be created for foreign investment, in accordance with international agreements and national convenience. According to these general rules, some of the industries under consideration or those activities enjoying priority under the program will now be reviewed, beginning with indus– tries related to forestry, whose problems have been treated in the preceding section. l. Forest industries a) Sawmills Given the extreme age of many of the natural forests, which presents the risk of losses ih timber, and small growth or nongrowth of the forests, we propose first to triple within a short time the amount ot wood cut from natural foresIs. This would be done essentially by small, movable, modern sawmills, which would provide good employment. By tripling the amount of lumber cut from natural forests, almost 80 million inches of timber would be obtained for the following purposes: . i) more adequately supplying the demand created by the housing problem in certain areas of the country; ii) exporting an additional amount of lumber -approximately 10-12 million inches-that would bring an income of approximately $ 40 million. . Of course, it would be necessary to study the capacity of the domestic and foreign markets to absorb the increased output. (This has not yel been examined). The purchase of small or medium-sized movable sawmills, which would provide employment, would demand an investment of approximately $ 40 million. b) Short-fiber cellulose, Chilean natural forests are a source of raw materials for producing short-fiber cellu– lose, Therefore, a forestry complex is being planned in the Panguipulli area. It would produce lumber and use waste and trees not suitable for lumber to produce short-fiber cellulose. At the same time, areas that would be cut and deforested would be planted with deciduous or coniferous trees, in order to provide forest resources for the future. The tota I investment wou Id be approximately $ 90 mili ion. It wou Id take fou ryears to put the required plant into operation. By 1978 it should be producing close to 220,000 tons per year ot short-fiber cellulose. The present price of this product is approximately US$ 350 per ton -that is, the gross income in foreign currency during 1978 would be $ 77 million. The short-fiber cel! ulose enterprise wou Id be developed with foreign capital. The first contracts . have already been signed. c) Constitución Cellulose Plant. The Constitución Cellulose Plant should start production by the end of 1974. Its maximum capacity is 175,000 tons of semibleached sulfate cellulose, whose FOB plant price is currently around US$400 perton. Basing calculations on a price of US$300 perton -the figure used in the balance of trade estimates- an additional annual income of $ 52.5 miliion will be enjoyed. Approximately $ 15 mili ion still have to be invested in the Constitu- ción plant. . d) Various timber enterprises. 241