In 2016, lower production and weak copper prices dampened growth. The country traditionally depends on the primary sector, specifically the extraction of copper, which accounts for almost half the country's exports. This trend is likely to continue in 2017. Exports of copper are nonetheless likely to benefit from the expected rise in prices, but gains will be limited by weak Chinese demand (largest customer). Private business investment in the mining sector is expected to remain weak, unless demand for metals (copper, in particular) rises again, subject to the infrastructure program planned by the new US president being implemented. Investment by public-sector mining companies is likely to decline due to continued government efforts to contain the rise in spending and the priorities granted to non-mining sectors. Household consumption is nonetheless likely to remain dynamic, buoyed by the increase in social spending (housing, healthcare, education subsidies) included in the 2017 budget, despite higher unemployment. The expected fall in inflation is expected to boost household purchasing power and enable the central bank to ease its monetary policy.

In 2016, Chile's public deficit worsened, hit by weak revenues (taxes and duties) from the mining sector, while non-mining tax receipts also declined on the back of the slowdown in activity. Spending remained high, despite the government's efforts, as these were not sufficient to offset the shortfall in revenues. Although President Bachelet has postponed his objective of eliminating the public deficit by 2018, his administration seems determined to cut spending growth over the next few years. The 2017 budget also provides for a 2.7% increase in spending compared with 2016, which is the smallest increase since 2003. The major part of the budget is likely to be devoted to social spending (healthcare, education, security) to the detriment of spending on infrastructure. The government's draft budget also provides for recourse to borrowing, specifically the use of bond issues to finance the deficit in the public accounts in 2017. This will contribute to an increase in the public debt, which will nonetheless remain fairly low.

With regard to the external accounts, Chile's current account deficit is expected to remain stable. The trade balance is likely to benefit from the expected increase in copper prices, but weak Chinese demand will limit any gains. The rise in the price of imported oil, though modest, will also prevent a faster reduction in the current account deficit. Despite the tourism revenues, trade in services is likely to remain in deficit, while the transfer balance is expected to remain slightly positive, thanks to remittances from expatriate workers which are higher than remittances back home by foreigners working in Chile. Dividend repatriation by foreign companies, particularly in the extractive industries, is expected to continue, but outflows are likely to be lower, because of the drop in profitability of companies in the sector.

The next presidential and parliamentary elections will be held in November 2017. President Michelle Bachelet, previously serving as president from 2006 to 2010, and re-elected in 2013, is not likely to stand again as under Chile's constitution an outgoing president is not allowed to stand. The coalition of right-wing parties (Chile Vamos), which won the 2016 municipal elections is favorite to win, while President Bachelet's left-wing New Majority coalition (Nueva Mayoría) is losing popularity. The administration's reform priorities, including the raising of corporate tax, have hit business confidence, contributing to a fall in investment and activity, already affected by weakness in the mining sector. The corruption scandals surrounding those close to the president and arguments between some of the coalition parties and the cabinet have led to historically low approval ratings for the president.