Claudia Ramírez Bulos
OECD
Aida Caldera Sánchez
OECD
Claudia Ramírez Bulos
OECD
Aida Caldera Sánchez
OECD
Over the last decade, Chile’s potential growth has decelerated, partly due to declining total factor productivity. To further reap the benefits of the digital transformation and to leverage new tools such as artificial intelligence to boost productivity and growth, Chile needs to improve enabling factors including digital infrastructure and connectivity, pro-competition regulatory settings, skills and a more inclusive digital diffusion.
Over the last decade, Chile’s potential growth has decelerated, productivity has been stagnant or even decreasing and the contributions of employment and capital to potential growth have declined (Figure 3.1). A rapid process of population ageing will reduce Chile’s labour force over the next years, and with that the economy’s growth potential. Despite some expected beneficial effects from recent immigration, the ratio of working age population to people over 65 in Chile will be 2.3 times in 2050 compared to 5.3 times in 2022, while in Latin America and the OECD, this rate will decrease from 8.4 and 3.6 in 2022 to 4 and 2.2 in 2050, respectively (OECD/The World Bank, 2023[1]). Therefore, potential growth and Chile’s long-term growth will likely decline unless productivity and investment increase. Chile can leverage the digital transformation to lift productivity across industries and promote the diffusion of knowledge across firms taking advantage of its good digital connectivity, its attractiveness to digital investors, and new technologies like artificial intelligence (AI). A more dynamic innovation environment could help address productivity and environmental challenges and leverage the opportunities created by the green transition, including the development of the lithium and hydrogen industry (Chapter 4).
Decomposition of potential output per capita growth, percentage points
Chile has progressed in several digital aspects over the past decade. Mobile broadband penetration and fibre optic deployment have increased significantly since 2010, and so has the use of digital tools among enterprises (Cámara de Comercio de Santiago, 2023[2]). Some policies since 2022 aim at improving digital skills and promoting financial and electronic payments (Table 3.1). Chile has also become one of the main hubs for data centres in Latin America, with the potential to keep growing (InvestChile, 2023[3]). The government is developing a National Data Centre Plan (2024-2030) that aims at creating public-private partnership agreements to deploy new data technologies, such as artificial intelligence, and to set guidelines and measures to create favourable investment conditions.
Several challenges remain, however, as Chile’s overall digital development remains below the OECD average (Figure 3.2). Even though internet access has improved over the years, getting closer to the OECD average, some gaps persist (Figure 3.2). Internet access is lower among households living in rural areas (85%) than among households in urban ones (95%). A similar divide exists between low income (89.6%) and high-income households (99.8%) (CADEM, 2023[4]), although more low-income households have internet access compared to the OECD average. The use of digital tools is low among small firms, business innovation remains low and digital skills gaps are significant. There are also persistent productivity gaps between a very small number of large and productive firms and a long tail of small and midsize less productive firms (OECD, 2022[5]), while the uptake of digital government services is relatively low (Figure 3.2).
To further reap the benefits of the digital transformation and to leverage new tools such as AI to boost productivity and growth, Chile needs to further improve its digital enabling factors including infrastructure, connectivity, pro-competition regulatory settings, adequate population skills, and foster a dynamic innovation environment. Further actions are also needed to improve government digital services, policies to boost adoption and diffusion of digital tools to drive productivity growth in firms, especially SMEs, and set a secure digital environment. This chapter identifies key priorities for action and recommendations across these areas, building on the OECD’s Going Digital project (OECD, 2024[6]), the OECD Artificial Intelligence Policy Observatory (OECD, 2024[7]), and past OECD Economic Surveys of Chile (OECD, 2021[8]).
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Past recommendations |
Actions taken since the 2022 Survey |
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Streamline permits and their process by implementing a zero-licensing procedure to encourage investment and simplify regulations for SMEs. |
A law bill to reform regulatory procedures and make them more expedite is under discussion in Congress, including a one-stop-shop for all sectoral authorisation requests. |
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Boost public support to SMEs, in cooperation with the private sector, through targeted programmes to facilitate the adoption of digital tools. |
Courses for workers and small enterprise owners have been created to increase the adoption and usage of the digital tools, especially in management and productivity. |
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Ensure low barriers to entry to the communication sector by replacing the existing regulation for concessions. |
The approval of the Law of Internet as a Public Service allows providers to use concessions for services different than the originally specified, granting more flexibility and lowering entry barriers. |
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Monitor closely the competition in the financial and electronic payment sector and take further actions if needed. |
A new FinTech and open banking law, published in 2023, established a regulatory and legal framework for FinTech companies to operate in Chilean financial markets. |
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Promote ICT programmes for the high-skilled jobs involving the private sector in the design of curricula and needs. |
Public-private partnerships that promote ICT programmes like the Training Service from the Ministry of Labour and Social Security (Sence) and Fundacion Chile have expanded. |
Chile has one of the highest internet penetration rates in the Latin American region (OECD, 2024[9]) even if it still lags behind the OECD average (Figure 3.3). Speed connectivity has also increased with around 69% of fixed broadband connections being fibre optic connections in 2023, above the OECD average of 41% (OECD, 2024[9]). Investments in connectivity, storage, and safe data transmission have also increased since 2016 (InvestChile, 2023[3]). Moreover, its technological infrastructure has expanded, including the installation of the first underwater fibre optic cable that connects California with Valparaíso in 2019, a cable that connects the US and Chile through Central America, and the start of the installation of the Humboldt Trans-Oceanic Cable, in 2023.
The government has launched a “2022-2025 zero digital gap” plan to further close connectivity gaps among regions. The goal is that fibre optic deployment reaches 100% of communes by 2025. A new law approved in July 2024, classifies internet as a public service, grants subsidies to the most vulnerable families to pay their internet bills and develops a connectivity registry to identify the connectivity status of households to facilitate internet provision. To narrow the gaps between urban and rural areas, licence obligations in the latest 5G bidding contest required to meet strict coverage conditions in rural areas. Despite these efforts and requirements to expand connectivity in rural areas, implementation remains burdensome and lengthy, particularly at the municipal level (CNEP, 2024[10]). Chile has continued the bidding for 5G Spectrum (band 3.5 GHz) in 2023 and 2024.
To further promote the deployment of infrastructure for fixed and mobile communications, important barriers to entry in the telecommunication sector need to be lowered (Figure 3.4). These barriers occur because of the existence of various cumbersome regulations which make it difficult for operators, especially incoming ones, to deploy their infrastructure and networks. The existing regulation for concessions, needs to be eliminated, as recommended in previous Economic Surveys of Chile (OECD, 2021[8]). Adopting a single licencing regime that authorizes operators to provide all communication services throughout the entire Chilean territory (OECD, 2021[8]), would facilitate potential new operators to enter the market and incumbent operators to engage in new communication services.
Barriers to entry in network sectors, index scale from 0 (least complex regulatory procedures) to 6 (most complex regulatory procedures), 2023
Note: LAC is a simple average of Colombia, Costa Rica, Mexico, Brazil and Peru.
Source: OECD 2023-2024 PMR database.
Taking full advantage of the digital transformation requires that individuals have good foundational skills, the ability to navigate technology-rich environments and to use internet in a variety of ways. Complementary skills, such as communication, creativity, or working with others are also relevant for the digital transformation (OECD, 2024[11]). Many Chileans lack the necessary skills to succeed in a digital world in 2023, with only 11.7% of adults proficient at problem solving in technology rich environments, well below the OECD average of 32.3%, and 41% of the employed adults who consider themselves as under-qualified for their job report inadequate proficiency in computer or software skills, close to the OECD average of 42% (OECD, 2024[12]). Even though internet use is high, it is mostly for recreational purposes. Productive use of the internet is low, 86.4% of users use it to obtain information, the most basic digital skill, but only 34.4% of users do online transactions and online procedures, and 30.3% use the internet for educational activities (CNEP, 2023[13]).
Good foundational skills are a precondition for developing digital skills. Even though improving access to high-quality education has been a key government objective for many years, literacy and numeracy skills are low among Chilean students, even if they are above other Latin American countries (Figure 3.5) (OECD, 2023[14]). Furthermore, Chile has many initiatives to expose children to STEM-related areas, but their scope is limited (CNEP, 2023[13]). The national curriculum which already includes the teaching of computer skills is currently under revision. Within this revision, more emphasis should be placed on developing digital skills beyond the simple use of computers, such as computational thinking and coding skills.
Adults’ skills for the digital economy are low in Chile. Around 50% of workers in Chile are in jobs that have a high probability of being impacted by automation technology (OECD, 2021[8]), and many of them will need to be able to work with digital technologies. Moreover, Chile’s green transition plans require sufficiently skilled workers to set up, operate, and improve equipment based on novel technologies, some of them still in development. Several initiatives have been implemented in Chile to boost training among adults. For instance, the programme, Talento Digital para Chile (expanded in the last years), brings together companies, training institutions and the government to help the unemployed gain digital skills to find jobs and evidence suggests that it significantly increases employability among participants (Neilson, Egaña and Humphries, 2023[15]).
Mean PISA score in mathematics, reading, and science, 2022
Note: LAC is a simple average of Colombia, Costa Rica, Mexico, Argentina, Brazil, and Peru.
Source: OECD, PISA 2022 Database.
The training system is fragmented, leading to a diversity of programmes with similar purposes and target populations. Agencies lack coordination with each other, resulting in unconnected efforts among different public agencies (OECD, 2021[8]). Given the rapidly changing tech environment, Chile would benefit from consolidating current training initiatives and regularly evaluating training programmes to identify those courses that lead to an increase in wages and offer the greatest economic value, as Israel does. Also, expanding the online adult training offer and setting individual learning accounts would support better skills, for instance by making the offer more personalised and flexible so individuals face fewer barriers to training and have more incentives to participate. Chile could follow the example of France and the Netherlands to allocate training rights to individuals. Training rights, through training vouchers and individual learning accounts, can be spent freely by the employees and are portable from one job to the other (OECD, 2019[16]). Such voucher systems or individual learning accounts should be accompanied by solid career guidance and quality assurance mechanisms to help individuals make informed choices of quality training options.
Chile faces a deficit of ICT professionals and demand is likely to increase in the future, as the information technology sector keeps expanding. For instance, demand for cyber security professionals in Chile grew by 28.7% in 2022, 10 times higher than growth in other professions (OECD, 2023[17]). Despite a high share of graduates in STEM in Chile, gender gaps are among the highest in the OECD (See Chapter 2). Furthermore, Chile has significantly lower ICT graduates compared to other STEM subareas (Figure 3.6, Panel A) and companies report skill shortages and a deficit of ICT professionals (Figure 3.6, Panel B). Survey data shows that 70% of the companies surveyed find the lack of technical skills as one of the biggest challenges (SENCE, 2022[18]).
Seizing the benefits of technological change depends on the availability of ICT specialists: workers who can code, develop applications, manage networks, and manage and analyse Big Data, among other skills. To reduce skill shortages, matching ICT training programmes with expected skills needs in various industrial sectors, including the effective use and interaction with AI systems can help (OECD, 2021[8]). As recommended in previous OECD Economic Surveys of Chile, continuous updating of vocational programmes, as well as of university curricula jointly with the private sector is essential to close the gap between supply and demand in the labour market. Moreover, providing better career guidance to students and adults and integrating working experiences in vocational and university programmes, can also help to improve employability. Establishing incentives through targeted subsidies and setting up sectoral levies to share the costs of training between firms could help foster training, increasing the number of ICT specialists. Austria, Germany and Switzerland, levies are collected by sectors; while in England (United Kingdom), only large employers contribute (OECD, 2021[8]).
Note: STEM stands for science, technology, engineering (including ICT fields), and mathematics. Panel B: The value of 1 represents the largest shortage and the value of -1 the largest surplus across OECD countries, skill categories and years.
Source: OECD Education at a Glance; OECD Skills for Jobs database.
Stronger competition from their rivals can motivate firms to adopt digital technologies and improve firms’ productivity. Chile has made good progress in reducing barriers to entry in product markets, getting closer to the OECD average since 2018 (Figure 3.7, Panel A). Chile’s competition authority has contributed to foster competition by undertaking ex ante regulatory impact assessments and market concertation studies in key sectors, such as pharmaceutical, poultry farming, and notaries. Some of these studies have resulted in legislative initiatives and sanctions translating into savings of around USD 1.7 billion per year for the government and consumers, according to the competition authority estimates (FNE, 2021[19]).
Digitalisation reshapes competition dynamics creating new markets and transforming existing ones, generating new challenges for policymakers and competition authorities. In rapidly evolving markets, the competition authority must grapple with uncertainty, address new forms of misconduct, and examine markets whose precise boundaries are unclear to strengthen their technical capacity and knowledge to deal with the rise in the use of digital technology, particularly AI, to understand the competition implications of AI, as well pave the way for future legislation, investigation, and remedies.
To further strengthen Chile’s competition authority’s capacity, options beyond expanding its budget to hire additional staff, include providing in-house training or upskilling of current staff, co-operating with other government agencies, or joining efforts with international counterparts. Some OECD countries have undertaken in-house training supported by other agencies, for instance in Korea, forensic experts at the Digital Investigation and Analysis Division provided training for the Korea Fair Trade Commission employees, thereby improving its overall capability to investigate digital evidence (OECD, 2023[20]).
Digital government can enable more proactive public services, improving speed, accessibility, and easiness of services and administrative procedures, supporting the digital transformation in the private sector (OECD, 2020[21]). In 2021, the Digital Transformation Law came into force, with the objective of digitalising all administrative procedures by 2027. The Chilean government is undertaking several initiatives to advance digital government to generate more transparent and efficient administrative procedures, and to modernise public services, both at national and sub-national levels (OECD, 2021[8]; OECD, 2020[22]). The Digital Transformation of the State Act came into force in 2022, with the objective of digitalising all administrative procedures by 2027. In 2023 Chile strengthened its institutional framework with the creation of a Digital Government Secretariat that consolidates the digital governance under the Ministry of Finance. The number of digitalised government procedures has grown to 89% of total procedures as of early 2024, while the number of people using a single identification service (ClaveUnica) has grown fivefold since 2018, reaching 15.3 million people. A programme to eliminate red tape and to digitalise processes (Estado Cero Fila), has helped expedite government procedures.
Note: LAC is a simple average of Colombia, Costa Rica, Mexico, Brazil, and Peru. Panel B: The digital government index benchmarks governments’ efforts to establish the necessary foundations for the digital transformation of the public sector.
Source: OECD, PMR database; OECD Digital Government Index 2023.
Despite this progress, Chile still performs below the OECD average on digital government (Figure 3.7, Panel B). Among other factors, this is explained by the need to consolidate ongoing initiatives into a clear and articulated strategic path to enable a whole-of-government digital transformation. For example, while public institutions are restricted from requesting citizen information that they already possess, government information systems remain fragmented, and each entity has its own platforms that do not always link with one another, posing important challenges for interoperability. As recommended in past OECD Economic Surveys (OECD, 2021[8]) and digital government assessments for Chile (OECD/CAF, 2023[23]; OECD, 2019[24]), it remains a priority to establish a public sector data strategy that enables sound and secure data governance in the Chilean government, supporting the identification of public sector data assets, registries and interoperability nodes, while making public sector data open by default (OECD, 2023[25]). Similarly, further efforts are needed to strengthen the governance of digital public infrastructure, including the single identification service (ClaveUnica) by aligning its governance with the OECD Recommendation on the Governance of Digital Identity (OECD, 2023[26]). Stronger governance is key for the digital identity to be used by different service providers, including the private sector, as well as to enable trusted access to services across borders. In a welcome step, the government created the Digital Government Secretariat to strengthen digital governance and established a "Public-Private Data Governance Commission” to develop digital and data governance guidelines for a National Digital Identity.
While firms are increasingly adopting digital tools in Chile (Figure 3.8), SMEs, which represent most businesses in the country, still lag large firms (Ministerio de Economia, 2020[27]). In 2023, 35% of SMEs were at the two lowest levels of digital maturity in e-commerce, while 63% of SMEs were at the bottom two in technology and digital skills, according to data from the government programme “Digital Checkup 2023”. Moreover, in 2023 only 31% of SMEs had a digital training programme for their workers and 47% continuously take steps to digitalise their firms, as opposed to 61% and 84% in large companies, respectively (Entel Digital, 2023[28]). To help SMEs overcome barriers to the effective use of digital tools, the government has put in place several programmes, mainly through training for business services, e-commerce, or to enhance the use of digital media (Box 3.1). However, many of these programmes focus on basic digital skills, while efforts should focus on facilitating SMEs acquisition of more advanced digital skills. One way to do so is by advertising the benefits of using the free self-diagnose and public training tools for the digitalisation of SMEs called “digital checkup” and by expanding the current online training catalogue to include more advanced online courses.
“Digitaliza tu Pyme" (Digitalise your SME), led by the Ministry of Economy, Development and Tourism, coordinates, and offers resources through a dedicated platform for SMEs and entrepreneurs seeking to enhance digital capabilities.
Training Service from the Ministry of Labour and Social Security (Sence) provides grants for SMEs that require specific training.
“Ruta Digital” (Digital Route), a training platform by Sercotec (Technical Cooperation Service), offers financial support and online courses on management and collaboration, marketing, sales, inventory, finance and security, innovative business, and cybersecurity.
“Fortalece Pyme” (Strengthen SMEs) is a Corfo programme that supports SMEs adopting digital tools and technologies through grants, training, and technical assistance.
“Pymes en Línea” (SMEs Online) is a Sercotec platform for the digitalisation of SMEs and entrepreneurs, allowing them to learn about the digital world, including how to sell through the Internet.
Survey data shows that financial barriers are the most common factor hindering the technological expansion in firms, particularly SMEs (Entel Digital, 2023[28]). Chile’s economic development agency (Corfo) and Start-Up Chile’s programmes are the main instruments for SMEs capital financing. Banking financing is limited, especially for smaller firms that typically receive bank loans at less favourable conditions than larger firms (Gamboa, Ormazábal and Yáñez, 2019[29]). To support the digital expansion of SMEs, the state could continue to offer guaranteed bank credits. Additionally, the government can explore expanding subsidies to support SMEs’ digitalisation, for instance via its agency for technical cooperation (Sercotec). Before expanding this support, the government should evaluate which subsidies are successful in improving digitalisation among SMEs, expand them, and eliminate non successful ones.
Additionally, FinTech companies may help fill in the funding gap for innovative firms through financial innovation and greater competition in the financial system, harnessing opportunities to develop new financial products and services. Chile has one of the main FinTech ecosystems in the region, with 300 startups in 2023, up from 179 in 2021 (Finnovista, 2023[30]). According to InvestChile, the growing popularity of FinTechs has been driven primarily by customer demand. The 2023 Fintech Law sets a regulatory framework for companies that offer financial services but are not currently regulated or supervised by the Financial Market Commission (OECD, 2024[31]) providing more certainty for FinTech companies to fully operate in the country. It aims at bringing FinTech activities, including crypto assets and open finance, into the regulatory perimeter and to fill the regulatory gap between new entrants and incumbent financial companies.
The risk of digital security incidents grows as the digital transformation deepens. Chile ranks seven in the Global Cybersecurity Index within the Americas, below Brazil and Mexico (ITU, 2024[32]), and cyberattacks have increased between 2022 and 2023 moving Chile from the 7th to the 4th place among Latin American countries receiving more cyberattacks in the region (Entel Digital, 2024[33]). In face of these challenges, the government has established a team to respond to cybersecurity incidents and in December 2023, Congress approved the Law on Cybersecurity and Critical Information Infrastructure along with a National Cybersecurity Policy. The law regulates private and public institutions that provide “essential services” and imposes obligations resulting in sanctions for non-compliance. This legislation goes in the right direction as it focuses on prevention and increases cybersecurity awareness by developing a national cybersecurity and privacy plan to equip the entire population with basic cybersecurity knowledge and enhance cybersecurity education across all educational levels. Ensuring an adequate implementation and regular updates of the national cybersecurity policy should be a priority, as the use of data among public and private institutions is likely to increase in the future, making it necessary to maintain up-to-date policies. It will also be important that the policy outlines obligations and standards for government bodies to ensure public cybersecurity, and that it provides guidelines for adequate risk management and prevention framework.
Digital innovation is a fundamental driver of the digital transformation, giving rise to innovative products and services, creating opportunities for new business models and markets, and driving efficiencies in the public sector. However, Chile invests relatively little in R&D, at 0.3% of GDP, well below the OECD average of 2.1% in 2022, with most resources coming from the public sector (Figure 3.9, Panel A) and a pronounced gap in business R&D with OECD countries (Figure 3.9, Panel B). According to the most recent national innovation survey, the percentage of companies that introduced technological innovations was 16.7% in 2019-2020, compared to 35% in the rest of the OECD, with large firms innovating more than small ones (Ministerio de Ciencia, Tecnologia, Conocimiento e Innovación, 2023[34]). To seize the opportunities of the digital transformation, it is necessary to invest in research and development (R&D), promote innovation, facilitate access to finance and support knowledge sharing and diffusion schemes among businesses.
The main factors behind low investment in innovation in Chile are financial constraints and the cost of innovation (Zahler, Goya and Caamanio, 2018[35]). Chile has R&D tax incentives and grants to support business R&D. A tax credit of 35% of the investment in R&D (capped at USD 1 million per year), plus a tax deduction for the remaining 65%. Besides tax incentives, Chile’s economic development agency (Corfo) and other government agencies provide numerous grants including innovation vouchers, like Innova. The National Research and Development Agency and Fundación para la Innovación Agraria (FIA) also provide R&D grants for research institutions and sector- related activities.
Despite the availability of programmes to boost technological innovation, public support to firms’ R&D and innovation activity is complex with overlapping objectives and in some cases reduced accountability when run jointly by different agencies. Simplifying R&D investment programmes and increasing coherence and integration among them would improve impact and public spending efficiency. Further efforts to strengthen impact analysis of government business R&D grants would be welcome, as evidence of these grants in promoting business innovation is limited. After evaluating current R&D grants, spending on new R&D programmes could increase based on cost-benefit analysis.
Strengthening the collaboration between businesses and universities, that in Chile remains low, would also help. Less than 10% of large firms collaborate with universities, compared to 29% on average in the OECD in 2022. One way to boost collaboration is encouraging the set-up of technology incubators affiliated to universities to identify high-potential, scalable start-ups and to enable the interaction of researchers, private-sector, local governments, or non-governmental organisations to facilitate digital knowledge exchange on advanced technologies.
Note: Data for Chile refer to the year 2020. LAC is the simple average of Colombia, Costa Rica, Mexico, and Argentina.
Source: OECD Main Science and Technology indicators database.
Artificial Intelligence (AI) has the promise to foster productivity and trigger an acceleration of innovation, though estimates of its impact are subject to significant uncertainty. Studies indicate that the extent to which new technologies are widely diffused or concentrated in a few leading firms, and the extent to which AI is labour enhancing as opposed to labour replacing matters for AIs potential effect (OECD, 2024[7]). To minimise drawbacks and fully harness the economic benefits of AI, governments need to put the right policies in place regarding safety, privacy, intellectual property rights, and information integrity (OECD, 2024[7]).
The share of firms using AI has risen rapidly in Chile, mostly large companies (Figure 3.8), while the public-sector is increasingly using AI tools in the judicial, social welfare, environment, and labour sectors. Around the world, governments are starting to use AI to automate simple tasks, engage with citizens, and improve education (See Box 3.2). Chile has an AI national strategy since 2021, that, based on the OECD AI principles, emphasizes the priority to cultivate local talent, strengthen the technological infrastructure, foster the use and development of AI, and ensure it is responsibly deployed. This strategy was updated in May 2024, placing more emphasis in governance and ethics and the role of AI in improving the state’s capacity. Regular updates are welcome, as AI is further adopted, governments should remain vigilant, so AI initiatives do not outpace regulation.
Promoting a responsible AI use and ensuring that algorithms do not perpetuate and exacerbate social inequalities and divisions through algorithmic decision making is crucial for an ethical AI use. The Chilean government, jointly with a university and other international organisations, developed the Ethical Algorithms project to promote ethical data management and the responsible development and implementation of algorithms, automated decision-making systems, and artificial intelligence, both in the public and private sectors. Furthermore, Chile, as other countries in the region, has advanced in the development of an AI ethics policy. As part of these efforts, Chile developed the State Data Strategy that promotes transparency, responsibility, and innovation to guide the use of AI in the public sector. These measures are welcome, and efforts should continue to ensure an adequate implementation of the AI national strategy. Additionally, to harness the benefits of AI in government services and the procurement of AI related products and services, the government should enhance the training of some government officials by creating AI learning tracks, and invest in the development of skills of civil servants through formal structured training programmes, and informal training -coaching or mentoring schemes, learning events or job rotation programmes (Burtscher, Piano and Welby, 2024[36]).
Law enforcement and criminal justice in Colombia: The “Recurrence Risk Profile for the Request for Incarceration Measures” (Prisma) is a tool for predicting the risk of criminal recidivism in individuals. The AI system was developed to support prosecutors when requesting preventive detention in jail. It also compiles all information available about the person under investigation.
Making work processes more efficient in Argentina: The Ministry of Finance of the Province of Cordoba developed an AI tool to automate tasks in bureaucratic procedures such as the verification of retirement contributions in the Social Security National Administration.
Using chatbots in the public sector in Brazil: Jaque is a virtual clerk based on AI to guide citizens through a digital catalogue that centralises all information on public services offered by the State Government of Alagoas. The tool provides a step-by-step explanation for each service and contains information on the length, availability, requirements, and location of processes.
Improving public employment services in Belgium: The Public Employment Service of Flanders' (VDAB) Competency-Seeker platform employs AI to help both jobseekers and employers enrich and refine the skills profiles they have and are looking for.
Source: (OECD, 2022[37])The Strategic and Responsible Use of Artificial Intelligence in the Public Sector of Latin America and the Caribbean and (Burtscher, Piano and Welby, 2024[36])
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Improving connectivity |
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Chile has one of the highest internet penetration rates in the Latin American region, but still lags the OECD average. Despite progress to simplify the licensing process, barriers to entry in network sectors remain high. |
Adopt a single licensing regime that authorizes operators to provide all communication services throughout the entire Chilean territory. |
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Enhancing digital skills |
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Foundational skills are low among Chilean students. Chile has many initiatives to expose children to STEM-related areas, but their scope is limited and out of the formal education system. |
Place more emphasis on the development of computational thinking and coding skills in the national school curriculum. Promote STEM skills development at schools, including investing in teacher training and equipment. |
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Many adults lack the necessary skills to perform adequately in a digital world, with only 11.7% of adults proficient at problem solving in technology rich environments, well below the OECD average of 32.3%. Programmes like Talento Digital have helped to increase employability, but its scope remains limited. |
Expand public online training programmes to reach more adults and to include more personalised and flexible contents. |
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There is a shortage of high-skilled ICT professionals and demand for ICT workers is expected to outpace supply going forward. |
Align vocational and university curricula with current and forecasted ICT skills in partnership with the business sector. Advertise the career benefits of ICT vocational and university training and strengthen career guidance. Integrate working experience in STEM vocational and university training. |
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About 50% of workers in Chile perform routine tasks with a high risk of automation and AI is likely to automate a significant number of increasingly complex tasks. The green transition will lead to reallocation of workers. Existing programmes such as Reinvéntate, provide training opportunities. |
Ensure that lifelong learning and reskilling programmes are prepared for labour market shifts caused by AI, automation and the green transition, through alignment of training to labour market needs and flexible adult learning provision to overcome barriers to participation. |
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Sharpening incentives to take advantage of digital technologies |
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Chile has reduced barriers to entry in product markets. The competition authority has fostered competition, but with the changing digital landscape the scope and complexity of its tasks are set to increase. |
Strengthen the competition authority’s technical capacity and knowledge through in-house training, and cooperation with other government and international agencies. |
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The government has several initiatives to advance the digital transformation of the public sector, but Chile still performs below the OECD average on digital government maturity. |
Consolidate ongoing initiatives into a clear and articulated strategic path to enable a whole-of-government digital transformation. |
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SMEs, accounting for most companies in the country, still lag large firms in digital adoption. |
Ensure the online training catalogue includes more advanced and tailored digital training for SMEs. |
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Cyberattacks increased from 2022 to 2023. The 2023 Law on Cybersecurity and Critical Information Infrastructure and the National Cybersecurity Policy focus on prevention and cybersecurity awareness. Data collection among public institutions is likely to increase in the future. |
Continue efforts to enhance cybersecurity, including by adequately implementing and maintaining up to date policies that outline the obligations and standards for government bodies to ensure public cybersecurity. |
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Bolster effective adoption and use of digital technologies and innovation |
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R&D expenditure is well below the OECD average and businesses spend relatively little in R&D. Programmes to boost technological innovation and grant public support to firms’ R&D are complex and with overlapping objectives. |
Simplify public R&D grant programmes supporting technological innovation, increasing coherence and integration, and in the medium-term, increase R&D spending based on cost-benefit analysis. |
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Better harnessing the benefits of Artificial Intelligence |
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AI use has expanded, and Chile has an updated National AI strategy to foster the use and development of AI focusing on governance, ethics, and the role of AI in improving the State capacity |
Ensure a proper implementation and regular updates of the AI national strategy. |
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AI use by government officials is expected to increase, while AI expertise within government is limited, hindering the procurement of AI-related products and services. |
Create AI learning tracks for government officials. |
[36] Burtscher, M., S. Piano and B. Welby (2024), “Developing skills for digital government: A review of good practices across OECD governments”, Vol. OECD Social, Employment and Migration Working Papers, https://doi.org/10.1787/1815199X.
[4] CADEM (2023), Estudio Décima Encuesta sobre acceso, usos y usuarios de Internet en Chile, Subtel, https://www.subtel.gob.cl/wp-content/uploads/2024/03/Presentacion_Subtel_Acceso_y_Uso_Internet_2023.pdf.
[2] Cámara de Comercio de Santiago (2023), E-commerce Innovation Summit 2023, https://www.ecommerceccs.cl/wp-content/uploads/2023/10/glever-SUMMIT-2023-EISummit2023.pdf.
[10] CNEP (2024), Productividad en el Sector de Telecomunicaciones, https://cnep.cl/wp-content/uploads/2024/05/Telecomunicaciones.pdf.
[13] CNEP (2023), Informe Anual de Productividad 2023.
[33] Entel Digital (2024), ¿Estás preparado para los desafíos de ciberseguridad del mañana?, https://enteldigital.cl/reporte-ciberseguridad.
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