Chilean Patagonia, on the southwest coast of South America, is one of the most spectacular and remotest places on earth. It is an intricate maze of 3,000 islands, steep-sided fiords, stunning blue-tinted glaciers, protected waterways, remote anchorages, active volcanoes, virgin jungles, fish-laden rivers and an incredible abundance of sea life from penguins to blue whales. At Patagonia's southern extreme lies barren, windswept Cape Horn and, just beyond, frigid Antarctica.
Despite benefiting from an impressive seven percent annual increase in tourism, Chilean Patagonia's marine infrastructure is unable to fully utilise the region's marine ecotourism potential. To address this, the Chilean Government is offering excellent financial incentives to encourage foreign investment and partnerships.
I recently spent ten days exploring the coast of Chile with a group of commercial marine and tourism operators. We were invited by CORFO, the country's economic development arm, to look at the many investment opportunities. We met with boatbuilders, shipyards and marina owners and tourism operators. We travelled by ship, tour boat, zodiac, plane and bus from Puerto Montt in the north to Punta Arenas near the country's southern tip.
Patagonian marine infrastructure
Chile's Patagonian coastline stretches for more than 2,000km yet its marine infrastructure is poorly developed. Most boats are still made of wood using traditional methods and materials. While Chile has a number of large-scale shipyards (Asenav, Asmar and Marco) the country has very few, small coastal shipyards/repair facilities and they are widely scattered.
The largest fibreglass boats we saw being built were less than ten metres in length, though there is reportedly a company based in Valdivia that builds 17-metre catamarans.
There are only a handful of marinas or breakwaters along the Patagonian coastline and most local workboats either moor out or are beached when not in use.
Chile's recreational boating industry is very small with only about 1,000 resident private yachts and about 50 visiting foreign yachts each year. Part of the reason is the remoteness of Chile (unless you're sailing around Cape Horn) and the lack of facilities to attract boat owners.
However, while people may not be bringing their own boats to Chile, the country offers one of the last unspoiled and beautiful cruising areas of the world and its attraction is bound to grow as adventure tourists seek out vacations in the remotest corners of the world.
Growing demand and opportunity
Unfortunately current laws prevent bare-boat chartering (regulations which may be changed in the near future) and the crewed charter boats we visited were better suited to backpackers than luxury- and/or privacy-seeking guests. Even so, most of the charter fleet is regularly booked up for the season.
But the fact remains, there are simply not enough charter boats (and Chilean captains) and attractive facilities to meet the growing demand. This inability to expand is largely due to a lack of capital and expertise among existing operators. There is a strong need for newly-formed companies, or partnerships with existing Chilean companies, for the building of modern vessels such as kayaks and rigid-hull inflatables for marine ecotours.
There is a need for larger, more comfortable charter yachts—whether built locally or imported. There is a need for mooring buoys and shoreside stern tie-up rings in areas where depths are too great for anchoring or where holding is poor. There is a need for numerous breakwaters and marinas. There is also a need for tour boats that can take 300 to 400 cruise ship passengers on day trips to visit attractions such as penguin colonies.
There are many opportunities to develop small waterfront lodges (floating structures are the most practical). Due to Patagonia's vast coastline and lack of road access to some areas there is also a real need for float-plane service to cut down travel time for visitors and to open up new areas. However, Chile is not looking for massive five-star resorts. The country would prefer to promote smaller, sustainable, low-impact businesses and/or partnerships with existing operators.
Incentives
As these are all businesses that are well established in other parts of the world, there is a huge potential for companies to make money in a country where there is little competition. To add to this, Chile has a strong and stable economy and offers a good climate for investment.
To move forward, the Chilean Government, through CORFO, is offering significant financial incentives for foreign investors (minimum investment $100,000). They include help with business planning, feasibility studies, legal paperwork, capital costs, wage subsidies, tax breaks and more that can save investors 20 percent of their costs. Other government funding agencies can contribute as well, with a combined potential for 50 percent savings on investment.
Of course, there are downsides to investing in a foreign country – cultural, language and legal differences – but Chile has the most stable government in South America (despite the recent earthquakes and a change in government). Agencies such as CORFO and a handful of consulting companies such as InvestInChile (owned in part by one of Chile's largest tourism operators, Matthias Holzmann) can help navigate the intricacies of foreign investment.
Peter A. Robson
For further information:
