Chile: Owner of the Future

Chile: Owner of the Future When the Chilean Congress unanimously passed a constitutional amendment last week nationalizing the copper mines, the whole country went on an emotional tear. Newspapers, billboards and walls blossomed with the slogan:

"Chile has put on its long pants! Finally the copper is ours."

President Salvador Allende pro claimed a Day of National Dignity and declared: "Now we will be the owners of our own future, truly the masters of our destiny." Chileans confidently predicted that under state management copper pro duction will jump to 840,000 tons this year, compared with 640,000 tons in 1970, and the projection is not considered unrealistic.

The amendment will affect three large American copper companies -- Anacon-UP, da, Kennecott and Cerro Corp. -- which have been partners with the Chilean government in the nation's five largest mines. (The government announced last week that it would also buy out the Chil ean operations of the Bank of America and the Bank of London.) Though copper nationalization was clearly a victory for Allende, one he has sought ever since he began his quest for the presidency 19 years ago, he was not altogether happy with the law as passed. The President had wanted indemnification to be paid over 30 years at 3% uncompounded interest. But Congress, narrowly controlled by the opposition, called for "no more" than 30 annual installments and "no less" than 3% interest, which leaves ample room for bitter dickering between government and the companies. The negotiations could very well send the cool relations between the U.S. and Chile to the freezing point.

Jockeying. There is already considerable disagreement over the value of the copper properties in Chile. The three companies claim that they have invested more than $1 billion; the government-controlled Chilean State Copper Corp. has set the figure at $724 million; and Allende, probably with tongue in cheek, puts it at $80 million. Obviously, some jockeying for good bargaining positions is under way.

In an emotional speech last week, Allende charged that Anaconda and Kennecott had done everything possible to damage the economy of the nation. Nonetheless, most observers believe that Allende is too pragmatic to risk the kind of bitterness that could follow if the companies are denied fair compensation, and will finally consent to a settlement approaching $1 billion. Only recently Chile negotiated agreements with four U.S. companies on terms that proved much more favorable than had been anticipated.

Economically, Allende himself has said that the nationalization may present problems for a while. But from a political standpoint, it has been a resounding success: not a single party has come out in opposition.

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