SANTIAGO, May 13, 2010 (Dow Jones Commodities News via Comtex) -- The chief executive of Chilean state copper giant Corporacion Nacional del Cobre (CODELCO.YY) on Thursday allayed jitters that the labor unrest seen at the Collahuasi mine could spread to the state miner.

Contract workers seeking better labor conditions and production bonuses went on strike last week at the privately owned Collahuasi, bringing production there to a standstill.

CEO Jose Pablo Arellano, whose term ends Tuesday, said there weren't any signs of labor unrest at any of Codelco's divisions.

"I don't have any indication of such a problem," he told reporters.

In 2008, contract workers at Codelco, employed by different mining services providers, went on a 21-day strike as they sought production bonuses and better working conditions.

Since then, Codelco revamped the tender rules for its contracted service providers, ensuring that norms are met, Arellano said.

"The model that Codelco developed is very clear. The relationship is between the worker and his employee and we only act to make sure that labor standards are met," Arellano said.

He noted the copper giant had set up a specialized enforcement team that monitors contract service providers.

As to the copper market, Arellano said he remains optimistic that demand in Asia, especially in China and India, will continue to fuel copper prices.

He said the recent events in the euro zone and the concerns raised by its debt show that the global recovery could be slower than originally anticipated.

"We will continue to see difficulties like the ones we've seen in Europe. While this won't necessarily hurt copper, it could hurt other Chilean exports," he said.

In addition to producing and exporting over a third of the world's copper, Chile also exports molybdenum, iodine, fertilizers, wood pulp, wines, fresh fruit and other agricultural products.