The Challenges for Sustainable Economic Growth in Chile and the Region

Ben Raderstorf / Inter-American Dialogue

On September 22, the Inter-American Dialogue co-sponsored an event at the Wilson Center with former President of Chile and current presidential candidate Sebastián Piñera Echenique.

Piñera began by offering his vision for the future of Latin America and Chile, noting nine “mega-trends” that are emerging in the region and that will undoubtedly shape its future. The trends included:

• The expansion of emerging economies 
• The end of three "supercycles": the U.S. borrowing cycle, the Chinese growth cycle, and the commodities boom
• Political populism and the growth of populist parties, especially in recent months
• Global climate change
• Emergence of a bipolar and multicultural world, focusing on China's rise
• Accelerated demographic change with improvements in healthcare and sanitation
• Increased demand for natural resources, water, and energy
• The emergence of a global "middle-class society" 
• Accelerated technological change 

Piñera also noted that moving forward, Latin America will need to address the challenges of income inequality, weak institutions, and issues in democratic governance. However, new sources of prosperity, greater human capital, and entrepreneurship offer the region an unprecedented opportunity to more fully integrate with the world and to improve the quality of state institutions across Latin America.

After laying out this vision, the candidate answered questions about a number of specific cases. In response to a question about income inequality in Chile, the candidate explained that there is no contradiction between growth and equality – that is to say, a country can focus on growing its economy as a means to ameliorate inequality by investing in education and creating jobs. Furthermore, the government can work to improve quality of life by reducing corruption, and strengthening democratic institutions and transparency. “There is no better police than sunlight,” Piñera said, referring to the role that public oversight can play in ensuring transparency in government. When asked about Venezuela, Piñera openly referred to the Venezuelan government as a dictatorship, stressing the humanitarian aspects of the crisis. On China, Piñera noted his disappointment that the United States had not moved forward with the Trans-Pacific Partnership, saying that it had given China an opportunity to increase its influence in Latin America, which will allow it to become a stronger player in the region, both in terms of economic and political influence.

Piñera then discussed his candidacy for the Chilean presidency, outlining his intention to reform education by de-regulating certain aspects of Chile’s education system. Furthermore, he discussed broad plans to reform healthcare, the pension system, and transportation and to encourage better inter-agency coordination between law enforcement organizations in order to address the issue of crime and security in Chile. Finally, Piñera stressed his commitment to encouraging entrepreneurship at all levels of Chilean society.

Watch the full recording of the event here: