As part of a restructuting process that was started in 1998, shoe company Bata Chile will import 90% of the shoes it sells in the domestic market from Brazil and China. In January, the company reduced the workforce in Chile by 327 workers at its Peñaflor Catecu factory, this equates to approximately 50% of its Chilean labour force. However, Gonzalo Landaeta, general manager at Bata Chile, gave assurances that there would be no more redundancies.

Following an increasingly widespread trend in the local shoe sector, Bata Chile has stopped production in the country to become an importer. Mr. Landaeta explained that by importing footwear rather than manufacturing it domestically, the company will be able to reduce costs by almost 50%. "Market prices have dropped 30% and together with other factors have led us to make these sad decisions," he said. He added that the company has also allocated funds to train the dismissed workers in order to help them find work in other sectors.

Since 2004, Bata Chile has dismissed 705 workers and in 2005 it closed down its Melipilla factory.

Bata will keep its Peñaflor unit open to produce safety shoes, at a rate of 1.5 million pairs per year. This operation will remain in Chile because safety footwear has to comply with certain standards and the Peñaflor factory is certified accordingly.

Bata’s footwear imports into Chile are expected to reach 5.5 million pairs in 2006, an increase of 1.5 million pairs compared with figures for 2005. Sales in 2006 are expected to reach CLP85,000 million ($163 million).