[SMM News] Chile proposes market reform to boost junior mining exploration

Chile, the world's second-largest lithium supplier, has unveiled a capital markets reform to boost early-stage mining exploration and attract foreign capital, per a government proposal. The bill, from President Jose Antonio Kast's administration, creates a dedicated investment framework for junior exploration and innovation firms, streamlining market access and cutting operating costs for early-stage lithium and mineral explorers.

Economy and Mining Minister Daniel Mas said integrating exploration into capital markets diversifies risk and draws investment funds seeking returns.

Eligible junior firms would access a simplified regime instead of listing on the national Securities Registry, operating under a designated sponsoring agent for compliance and disclosures. Incentives include capital gains tax exemptions on share sales and write offs for greenfield exploration costs.

Officials expect the framework to let private capital absorb early-stage geological risk and drive new mineral discoveries, including potential lithium finds.

Easier exploration funding could, over time, expand Chile's lithium resource base and support new project pipelines. Any output impact would take years to materialize, leaving near-term global lithium supply-demand balances, still led by Australia, China, and emerging African producers, unaffected for now.