Chilean industry hit by crisis

The international economic crisis, which has forced giant conglomerates to put some of their most prized projects on ice, has also driven some of Chile’s best known corporate names into bankruptcy. Las Últimas Noticias reports that the number of compan

Fernando Sánchez

The global economic crisis has halted work on the Costanera Centre.

Work on the US$500 million Costanera Centre project in Santiago, with its showcase shopping mall and Latin America’s tallest skyscraper, has been halted because of the economic crisis.

SANTIAGO, Chile - The international economic crisis, which has forced giant conglomerates to put some of their most prized projects on ice, has also driven some of Chile's best known corporate names into bankruptcy. Las Últimas Noticias reports that the number of companies going bust in the first quarter of this year was 70 percent higher than a year ago.

Rodrigo Albornoz, the superintendent of bankruptcies, told Radio Cooperativa that his office and the Chilean and Santiago chambers of commerce will be exploring ways in which existing laws might be changed to slow down this alarming rise.

The global recession has forced giant retailer Cencosud to halt construction work on its US$500 million Costanera Centre project in Santiago. Cencosud also has operations in Argentina, Peru, Colombia, and Brazil. The president of Cencosud, Chilean businessman Horst Paulmann, decided to put the project on hold until the economic uncertainty has been left behind.

In October last year, the company saved itself $200 million by postponing the building of an office block and a five-star hotel. The project includes a shopping mall, four buildings, the Gran Torre Costanera (at 300 metres tall, when completed, will be Latin America's tallest skyscraper), and a smaller office block.

Las Últimas Noticias also reported the bankruptcy of two of Chile's best-known companies - car dealer Persico Brothers and drapery chain Inaudito. The former was unable to meet payments on its $9.8 million in bank loans, while Inaudito, according to Radio Infinita, was priced out of the market by cheaper competitors and has filed for bankruptcy with debts of $6.7 million.

Persico Brothers, one of Chile's longest-established car dealers, has been selling Peugeot cars since 1968. Inaudito, too, had been a familiar name on the country's high streets for more than 40 years.