PrintSend to friend

Alfredo Ergas

It’s hardly news that the solid regulatory framework of the Chilean financial market offers a stable platform for both local and foreign investors to develop new investment projects.

This is the result of a series of reforms in capital markets over several decades, which have transformed Chile into an investment magnet in the banking, retail, telecommunications, energy and mining sectors to name a few.

But we aren’t alone as other countries have implemented similar reforms, sometimes copying or improving on Chile’s reforms, and in doing so transforming themselves into more attractive investment destinations than Chile.

To remain competitive, the financial integration of the local market with foreign markets, and especially the North American one, is important since it facilitates access by foreign investors to investment opportunities in Chile.

In September 2008, the Finance Ministry created the Capital Markets Advisory Council to promote public-private sector interaction in the development of the local financial market.

The Council brings together the experience and concerns of local actors in different areas of the financial sector. Aside from its advisory role in the Ministry, the Council proposes reforms, identifies legal obstacles, and evaluates regulatory changes in the sector.

On the sidelines, a group of council members noticed the potential for an independent organization that would group professionals from public and private entities interested in promoting the internationalization of Chilean capital markets.

With this aim, the non-profit organization InBest was born in 2009. In addition to promoting the Chilean financial market as an investment destination and a platform from which to export financial services, InBest provides a mechanism to channel the concerns and requirements of foreign investors interested in doing business in Chile.

Today, InBest has nearly 200 members from the financial sector including stockbrokers, financial managers, bankers, attorneys, consultants, pension fund managers and insurance company executives.

However, membership is on an individual basis which means anyone can participate regardless of his or her affiliation. By making InBest an open platform in this way, the aim is to maintain its independence from companies and institutions involved in the financial market.

The members are organized into 14 working groups, or subcommittees, which meet regularly. Some members participate in more than one group, but the aim is to bring together professionals who work in the same area such as the stock market, banking, derivatives or financial regulation.

Each subcommittee has one or two coordinators, usually recognized figures in their respective fields, who coordinate meetings, listen to concerns and report back to the board. Based on their findings, they are responsible for submitting a five-year plan to the board, which in turn presents a unified vision to the authorities.

By bringing the concerns of all parties to the attention of financial regulatory bodies, InBest is becoming an important link between the local financial community and foreign investors.

At the end of the day, the organization’s main goal is to help the government make financial institutions more modern and efficient. By identifying areas for improvement, InBest aims to facilitate investment and develop a local financial industry that meets world-class standards.

Showing the world a united front in this regard is imperative, which is why one of InBest’s most important activities is Chile Day. This annual two-day event, held in New York City, brings together important figures from the financial industry, capital markets and foreign investors.

The first Chile Day was held in 2000 and organized by AmCham’s ADR Issuers Committee headed by Juan Ignacio Domínguez, then CFO of Enersis Group. InBest took over organizing the event from AmCham this year and aims to continue the tradition begun a decade ago.

Led by Finance Minister Felipe Larraín and his team, Chile Day 2010 on July 15-16 was expected to be a great success with the participation of executives from the private sector, including InBest members, who planned to meet with Wall Street investors and analysts.

Most importantly, Chile Day is an outward sign that Chilean authorities and the private sector are on the same page when it comes to improving the functioning of the financial market and increasing investment.

Not everyday can be Chile Day but, at InBest, we believe that by providing an independent forum for executives and authorities to meet and discuss ideas, Chile can internationalize its capital markets and attract more investment, which is good for everyone.

Alfredo Ergas is President of InBest and Chief Financial Officer of the Enersis Group. He is also a member of the Finance Ministry’s Capital Markets Advisory Council, an advisory member of AmCham’s board and president of its Finance and Capital Markets Committee.