• Chilean President José Antonio Kast is pursuing a market-oriented critical minerals policy, breaking with former President Gabriel Boric’s state-led lithium strategy. 
• Kast has merged the economy and mining ministries and signed his first Special Lithium Operation Contract (CEOL) with a private company, but the mining code and permit reforms remain pending.
• Minerals are central to Chile’s revenue, and Kast must align with Washington while keeping China, one of the biggest buyers of Chile’s minerals, on side.

Why is Kast MILD?

Answer: Although some measures of Kast’s critical minerals policy have been implemented, key structural reforms remain pending, limiting progress towards his objectives.

José Antonio Kast became president of Chile on 11 March 2026, leading the most conservative presidency since Chile’s return to democracy. His critical minerals policy matters because these resources are central to Chile’s economy: Chile is the world’s largest copper producer and the second-largest lithium producer. Kast favours a more market-oriented approach to lithium than Boric, whose 2023 National Lithium Strategy strengthened the state’s role in the sector. 

As president-elect, Kast announced the merger of the Ministries of Economy and Mining into a single ministry, led by Daniel Mas. In August, his government signed a CEOL with Quiborax, a private company, to produce lithium in the Arica and Parinacota Region. 

The Reconstruction and Economic Development (RED) Bill, also known as “Megarreforma”, was submitted in April and was enacted in October 2026, after several months of legislative processes. The mining code simplification, introduced by Kast in May, has not yet been approved by the Chamber of Deputies.  

The president has set a clear direction, but its effects on investment and permitting cannot yet be measured, leaving him MILD.

What is changing Kast’s heat level?

Answer: While institutional constraints have not completely prevented Kast’s agenda from progressing, public response to specific parts of his agenda shows some discontent.

The biggest delay to the government’s agenda came from the Constitutional Tribunal. On 13 August 2026, the Tribunal declared Articles 12 and 13 of the RED bill unconstitutional in their entirety, after opposition parties brought challenges to the Tribunal. These articles would have given investors a right to compensation if a court annulled a project’s environmental permit.

The ruling also triggered a revision of the RED Bill, which ended on 6 October 2026 and further delayed its implementation. The bill has since been enacted, showing that the setback slowed the reform rather than stopped it.

Public opinion is a second constraint. The president’s approval fell to 35% in September, the lowest since he took office, according to Cadem, though there is no clear link between this figure and his critical minerals policy. Views on specific objectives are mixed: 79% of Chileans view alliances between Codelco and private companies favourably.

Environmental rules are a harder sell. Most respondents oppose relaxing environmental procedures or accept it only if protection is not weakened, and 16% support lowering requirements to stimulate the economy. With the least public backing for this part of his agenda, Kast remains MILD.

What is driving Kast?

Answer: Kast’s critical minerals policy is driven by his desire to change the state’s role in mining and by his ideological affinity with other right-wing governments, such as the Trump administration.

Kast has long argued that state-owned companies lack the expertise to extract lithium and that private investors are better placed to do it. This fits the pro-market positions of the right-wing government he leads, and it explains why he is reversing Boric’s state-led approach. Through this conviction and ideological affinity, Kast has also signalled the desire to strengthen ties with the US. 

In March 2026, before beginning his term, he attended the Shield of the Americas Summit, which launched a US-led coalition to improve regional security and combat drug cartels in Latin America. Right after the Summit, on 12 March 2026, Kast signed a  joint declaration with the US, establishing a consultation mechanism on critical minerals and rare earths. This was followed by the signing of two Memoranda of Understanding between Chile and the US, which provide for technical consultations and cooperation on copper, lithium and rare earths, including technology exchange and processing, but impose no export obligations. 

Despite the rapid alignment with the US, China remains one of the biggest buyers of Chile’s critical minerals, as well as a major investor. Kast is therefore bound as much by the need to keep Beijing close as by his alignment with Washington.

What does this mean for you?

Answer: Kast’s critical minerals policy could raise Chile’s leverage as a supplier both regionally and to the US and China, but only if agreements become more concrete.

On 28 August 2026, Chile, Argentina, Bolivia and Peru signed a joint declaration in Santiago to deepen cooperation on strategic minerals, coordinate investment, seek multilateral financing and exchange information, aiming to present South America as a reliable supplier. Kast could use Chile’s position, and his hosting of the signing, to raise its regional leverage, since a coordinated bloc would be stronger in the critical minerals market than four separate producers. However, Chile’s weight would rise only if coordination moved into joint processing, shared infrastructure or some form of common standards. 

Kast also faces a strategic balancing challenge between the US and China. In March 2026, Kast himself stated that it would be possible for Chile to remain on good terms with both China and the US.  His actions have thus far matched his words: closer ties with Washington, a meeting with China’s ambassador in July 2026 and his planned trip to the APEC summit in China in November. Hedging between the two protects both markets, but it will raise Chile’s leverage only when it is backed by concrete commitments from each side.