In view of the above, we have implemented a Global Accounts Department, in order to fulfill this growing market’s requirements.

We have also continued to improve the Customer Service teams, for which a Seminar was organized in Chile allowing CSAV representatives to meet with CSAV commercial agents in South America and the United States, in order to standardize work processes and procedures.

In accordance with our customers’ requirements, we have continued to improve our page on Internet, making it easier for users to obtain access to our services. At the present time, information can be obtained such as: Vessel Itineraries, Container Characteristics and Usage, and the Agency Network throughout the world.

During the period in question our page received over 160,000 visits, over 65% of which were international visitors.

This is an incentive for us to continue to develop this important channel, which will enable us to offer our clients a better and faster service

The sustained growth of the Company’s liner services represents an important challenge for this Division, which operated an average of sixty vessels during the year 2000.

Norasia’s acquisition and recent incorporation into the CSAV group operations have made it necessary to decentralize control over operations, transferring certain responsibilities to the regional centers in Fribourg and Hong Kong to cover the activities of all the Company liner services in Europe and Asia, respectively. These new operation centers are additional to those already existing in Valparaíso, Rio de Janeiro, Miami and Los Angeles, thus generating global coverage for better handling of vessel operations in the different ports of the world.

Moreover, the Quality Control Department, which comes under this Division, has continued to train Company personnel to meet successfully the external auditing requirements which have enabled us to maintain the Company’s ISO 9002 certification for a third consecutive year.

The most relevant events in the year 2000 in terms of vessel purchases, sales and projects were the following:

On 5th January, M/V Lontué, owned by the Liberian subsidiary Mermaid International Shipping Corporation, after having been on bareboat charter for an approximate period of four and a half months, was delivered as programmed to its new owners, Vermeer Navigation Company Limited, of Valleta, Malta.

On 14th January, M/V Longaví, for operational reasons, was sold to our Liberian subsidiary Fisher Investment and Trading Corp. The delivery of the ship itself took place at the port of Cristóbal, Panama.

On 19th January, M/V Loa, for operational reasons, was sold to our Liberian subsidiary Winner Capital Corp. The delivery of the vessel itself, which was renamed M/V Limarí, took place at the port of Cristóbal, Panama.

An agreement was reached in the month of March with Oskar Wehr KG (GmbH & Co.) for the sale of the B170-type containerships Illapel and Elqui, which were delivered in San Vicente, Chile (27th April) and Rio de Janeiro, Brazil (22nd May), respectively. Both sales consider a five-year charter to CSAV.

On 22nd June, at the port of Antwerp, Belgium, M/V Bío-Bío, owned by Liberian subsidiary Bio Bio Shipping Co. S.A., was delivered to the new owners, Duke Shipping Limited, of Valleta, Malta. Simultaneously, the vessel entered a charter for a period of two years and is now being operated by our Asia and Bulk Division.

On 7th August, M/V Laja was changed, for operational reasons, from Liberian to Chilean Register. The vessel kept its name and now operates on the Conosur service.

On 19th August, M/V Maullín was sold for scrapping to Maritime Delivery Inc. Delivery of the vessel itself took place at the port of Xinhui, China.

On 31st August options 8, 9 and 10 of the joint project with Peter Döhle Schiffahrts – KG (GmbH & Co.) to build new B178-Is were confirmed, and at the same time contracts were signed for three additional options, to be declared in October 2001, for B178-I hulls 15, 16 and 17.

On 20th September and after sixteen years in the Company service, M/V Maipo, owned by Liberian subsidiary Wellington Ocean Shipping Co. S.A., was sold to Inman Enterprises S.A. of Monrovia, Liberia. Delivery materialized at the port of Bilbao, Spain, where, on that same date, the vessel entered charter by CSAV for a two year period, to cover the same Eurosal service operated by the Europe Division.

On 10th October and for operational reasons, M/V Lircay was changed from Liberian to Chilean Register. The vessel, which kept its name, now operates on the Conosur service.

On 19th December M/V Pacific Rider, owned by the Panamanian company East Trade Shipping Company Inc. (a partnership structured with CSAV and CCNI capital on an equal basis) was sold to its new owners, our Panamanian subsidiary South Wind Overseas Co. Inc., said company retaining 100% ownership. The delivery itself took place at the port of Balboa, Panama.

Also in December associates Ridge Holding Co. Ltd. and Pantile Holding Co. Ltd. transferred the building contracts with the Polish shipyard Stocznia Szczecinska S.A. of five containerships. As a result of same, five ship charter contracts were cancelled with subsidiary Brunswick Investment Co. Inc., benefiting same considerably.

Management of the units of the fleet entirely owned by Compañía Sud Americana de Vapores S.A. as well as of those vessels belonging to its subsidiaries, associated companies and jointly with other Chilean and foreign shipowners, has been entrusted to technical operators of international repute, among them Southern Shipmanagement (Southship), a corporation established and operated in co-ownership with Wallem Shipmanagement Ltd. of Hong Kong, China.

Likewise, management of the vessels Toltén and Braztrans I has been delegated to Midocean Shipmanagement Ltd. of the Isle of Man, and Companhia Libra de Navegaçao, Brazil, respectively.

Within the framework of a permanent policy to guarantee our customers quality service, and in addition to the above, with the firm purpose of being able to be actively involved, with high economic efficiency, in the day by day more competitive environment of the maritime transport industry, efforts have been centered on acquiring great trustworthiness and safety in the daily operation of each of our vessels, at costs compatible with international levels.

Thus, within the ambit of standing international regulations on maritime modes of transport, managers have strictly fulfilled the regulations of the ISM Code (International Management Code for Safe Operation of Ships and Pollution Prevention) and, in an important effort to ensure the quality of ship management services, technical operation procedures have been certified under ISO 9002 quality standards, which represents a guarantee of excellent service to our shippers. The above shows our permanent commitment regarding quality performance, privileging the safety of human life at sea and the protection of both the marine environment and of the goods entrusted in custody.

Also, it should be emphasized that during the year 2000 all our own vessels have been equipped with modern electronic data transfer systems (IT Systems), thus allowing management ashore to communicate directly and online with the vessels. The latter has led to more efficient technical and operational management of all human as well as material resources.

All the efforts described, together with the continuous and self-sacrificing daily work of our crew members on board, guarantee the good operational condition of every vessel’s systems and equipment, strengthening our commitment to provide an efficient service to the advantage of our clients.

The volume of operations increased significantly during the year, and included the new subsidiary Norasia Container Lines Ltd.

Appointments

On 2nd February, Mr. Hugo Petric Bascuñán was appointed Manager, Americas Division.

On 2nd February, Mr. Cristián Mandiola Denis-Lay joined the organization, asuming the position of Manager, Commercial Division.

On 21st March, Mr. Rodrigo Vergara Barbagelata was named Sub Manager, Systems Division.

On 21st March, Mr. Guillermo Ginesta Bascuñán was named Head, Container Logistics Division.

On 14th August, Mr. Juan Pablo Armas MacDonald joined the organization, taking on the position of Assistant Manager, XXIst Century Project.

On 16th August, Mr. Jorge Alvarez Molina joined the organization, taking on the position of Manager, Personnel Division.

On 7th August, Mr. Fernando Escobar Robles took on the position of CSAV Representative in the city of Hong Kong.

On 1st January, Mr. Franz Pieber Aguirre took on the position of CSAV Representative in Hamburg, Germany.

In the field of training of personnel, efforts were centered on the development and strengthening of personnel capabilities to prepare them to handle successfully the day by day more demanding and competitive shipping business.

To make the above possible, 24,587 hours of training, the equivalent of 230 courses, were given during the year.

The larger number of courses was due to the greater care taken to fulfill the needs detected the previous year as well as those which came up during the year.

In order to measure the result of this activity, a pilot plan was started to evaluate the impact of the Training. This is measured in terms of work performance. What was thus accomplished merited favorable remarks from the ISO 9002 external auditors.

An Organizational Climate survey took place this year. It was carried out to fill the need to know the Company workers’ perception of the quality standard of their life at work, and provided relevant information for the Divisions; as a result, six Divisional Seminars were held on different subjects. These seminars were incorporated into the training activities, thus strengthening the teamwork. The latter aspect is considered fundamental for the success of the Company.

Housing

As of 31st December 2000 a total of 211 housing loans had been granted since the system was started, to purchase, build and repair housing. Moreover, as part of the last Collective Bargaining, and with the intention of favoring the workers, the pertinent Ruling was amended, lowering the prior savings requirement for the purchase of houses costing not more than 1,500 U.F. (Chilean inflation link unit).


Health

As a result of joint negotiations with subsidiaries (SAAM and SSM), a new contract was signed for Catastrophic Illnesses Insurance, with an Insurance Company with international backing. Thus it was possible to improve on the price of the premiums significantly, as well as on the conditions of the Insurance Policy covering this type of illnesses which can affect the workers and their family dependents alike.

Recreation

During the year 2000 the Company continued to favor and promote activities for the recreation and integration of personnel and their families.

Following tradition, a number of events took place at the Montecarmelo Country Club.

Also in the year 2000, the Cabins at the Club de Campo were remodeled in order to keep up an appropriate standard for use of the facilities by members and their families.

Scholarships

During this year, Management saw fit to create a Scholarship system. As a result of same, four scholarships were given to workers’ children who, having excelled in their academic results, deserved this encouragement. The scholarship finances the university and/or professional technical studies of those favored. This benefit will apply from the year 2001.

Company staff members by 31 December 2000 numbered a total of 565 workers, distributed in the Valparaíso and Santiago offices and also in CSAV’s agencies abroad. The number of workers in similar destinations at the end of the previous year was 522.

The number of staff members working in the different companies included in the Consolidated Balance Sheet , including, subsidiaries and associates, amounted to 4,150, of which 133 were executives and 1,066 professionals.

The total number of staff members in CSAV and subsidiaries is summarized in the following table:

Labor relationships with Company workers have continued to be excellent, especially where cooperation, respect and understanding are concerned, for the benefit of all.

In the year 2000 the Collective Negotiation process was implemented with the CSAV Workers’ Union. This negotiation took place within the stipulated time limits. The process was concluded with the signing of a new Collective Agreement, effective for four years. The Company values in this way the mutual confidence shown and the permanent cooperative behavior of the workers.