Development Corporation (CORFO)

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Development Corporation (CORFO)

This Chilean development agency was begun as a government entity to supervise the reconstruction of Chile's south following a disastrous 1939 earthquake that inflicted enormous damage and took approximately 30,000 lives. The Pedro Aguirre Cerda regime (1938–1941) subsequently gave Corporación de Fomento (CORFO) the task of developing the Chilean economy, particularly by increasing the country's power supplies and creating basic industries. Funded initially by special taxes, particularly on largely U.S.-owned copper mines, and by foreign loans, this government agency grew. CORFO has also financed private ventures, as well as state enterprises, if they seemed to lead to import substitution and to produce products that might improve the nation's standard of living.

As one of its many achievements, CORFO succeeded in developing hydroelectric projects as well as a state-owned steel mill, and in discovering petroleum in Magallanes. CORFO often acted as a minority stockholder in privately owned corporations. During the Salvador Allende regime (1970–1973), CORFO received additional funds which it used to purchase shares of public corporations, in effect transferring them from the private to the public sector. Then, consistent with its economic philosophy, the Augusto Pinochet administration (1973–1990) sold many of CORFO's assets to private individuals. In the twenty-first century, CORFO has given new attention to market changes, diversification, and expansion of Chi-lean businesses in all regions of the country. It plays an important role in offering credit and resources to small and medium-size enterprises (pequeñas y medianas empresas. CORFO not only has provided significant assistance to Chile's industrial sector but also has demonstrated the role of the state in fostering economic development.

See alsoAguirre Cerda, Pedro; Pinochet Ugarte, Augusto.


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                                          William F. Sater

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Development Corporation (CORFO)

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Development Corporation (CORFO)