Thursday, 23 July 2009

Conservative presidential candidate Sebastián Piñera’s economic proposals range from misguided to erroneous, Finance Minister Andrés Velasco said in an interview published Wednesday in the daily El Mercurio.

Velasco, one of President Michelle Bachelet’s few ministers to have held onto his job since the 2006 inauguration, and regularly the most popular member of the administration aside from Bachelet herself, defended the government’s stimulus plans and criticized Piñera’s plans as either already in place by the government, “factually incorrect” or simply “inexplicable paradoxes.”

“Throwing out numbers is easy, but the real challenge is to show the tools and policies to achieve those numbers,” Velasco said. “The truth is that out of all of the proposals made by (Piñera), it’s impossible to find new measures that are not already in implementation.”

Velasco, 47, also said the country would experience more negative economic times this winter, but that “the second half of the year should generate better figures.”

“I have confidence that the fiscal and monetary policies are having an effect,” said the finance minister.  “But I also know that they do not work overnight.”

Velasco, who was exiled with his family at age 15 at the start of Augusto Pinochet’s regime, was educated in the United States. He holds Bachelors and Masters Degrees from Yale University and a Ph.D in economics from Columbia University. More recently he held a faculty position at Harvard’s John F. Kennedy School of Government.

Near the beginning of his tenure as Chile’s top financial leader he was widely vilified for refusing to spend windfall copper profits generated by the state-owned Codelco. But more recently, now that copper revenues are off sharply, he has been lauded for maintaining the huge government surpluses, which have allowed the government to fund many of Bachelet’s social programs. A public opinion poll in May showed Velasco enjoys a 64 percent approval rate.

The popular minister also strongly defended the administration’s decision to keep CODELCO, the world’s largest copper producing company, state-run. He explained that the government is applying the “best corporate governance in the world for a company of that nature,” including adhering to the standards recommended by the Organization for Economic Co-operation and Development, of which Chile is not a member.

“I see very serious and professional work from this team and a record of nearly two decades by Concertación-led governments providing serious, responsible and not populist economics,” he said. “That is what the public has recognized and valued.”


By Daniel Zarchy (

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