Chile’s brain exports

by Dave

This is a brilliant idea. I wish other countries in Latin America follow this example, especially Venezuela.

in an interview with Chilean Foreign Minister Alejandro Foxley, I learned about Chile’s recent decision to create a $6 billion fund to send 6,500 Chilean students a year abroad to pursue post-graduate studies in the United States, European and Australian universities. The students will receive full scholarships, paid from the new government fund’s annual interest.

For a relatively small country of 16.4 million people, it will amount to a massive export of some of its best brains in hopes of getting some of them to return home with greater technological skills, better international contacts, and new ideas to help the country diversify its exports.

Most of the scholarships will be focused on post-graduate engineering, science and technology studies, which are considered the key areas to help the country produce more sophisticated — and higher priced — export products.

“If Chile wants to grow faster, we can’t keep exporting just copper, cellulose and salmon,” Foxley said. “We need to create new products. We need to take a whole new generation of students, or as many as we can, and expose them to the global economy.” The new fund, known as Bi-Centennial Human Capital Fund, will come from Chile’s recent export surpluses from sky-high copper and other commodity prices.

It will be invested in banks abroad to keep the money from entering Chile and creating inflationary pressures at home. In addition, the new fund — first announced by President Michelle Bachelet in a May 21 state of the union address — will pay for additional scholarships to 2,000 young technicians for courses at community colleges in the United States and other industrialized countries, and for at least 100 foreign scientists to teach at regional universities in Chile’s countryside.

I asked Foxley: Aren’t you afraid of a massive brain drain? Many of the 6,500 students pursuing post-graduate degrees in the United States and Europe may not go back.

“We don’t care if they don’t return to Chile immediately,” Foxley said. “If you look at what has been happening in India, many Indian computer engineers have remained for 10 years working in the United States, and then have returned home to start up new companies. We have to think long-term.” Patricio Navia, a professor at Chile’s Diego Portales University and New York University, says the new fund is an excellent idea whose success is not guaranteed.