Chile protests resume as economy slows

The demonstrations began last month after the government announced a hike in subway fares and transformed into a national movement with broader demands over education, health services and economic inequality. Santiago’s subway system has said that it has suffered nearly $US400 million ($580 million) in damages, while businesses in Chile are estimated to have lost more than $US1.4 billion to arson, looting and lost sales.

A police water cannon vehicle is hit by a gasoline bomb during clashes with anti-government demonstrators in Santiago on Monday.Credit:AP

Before the marchers gathered, Finance Minister Ignacio Briones warned that negative economic impacts from the protests in the planet’s leading copper producing country forced officials to lower their 2019 economic growth prediction to between 2 per cent and 2.2 per cent from 2.6 per cent.

His announcement was met with disdain by protesters who said they have not shared in Chile’s economic prosperity.

Marcos Diaz, a 51-year-old teacher protesting in the capital of Santiago, said big corporations have been the biggest beneficiaries.

“Through all these years of democracy, we’ve been living with a minimum wage that puts 60 per cent of the workers below the poverty line,” he said. “Growth is a fallacy invented by this model to hide the inequality of this country.”

Police water cannon advances on anti-government demonstrators in Santiago, Chile, on Monday. Announced reforms have not yet satisfied protesters who want the President to resign.

Police water cannon advances on anti-government demonstrators in Santiago, Chile, on Monday. Announced reforms have not yet satisfied protesters who want the President to resign.Credit:AP

Accountant Veronica Gonzalez said even though she believed people were losing money from the protests, they would get it back later and that “this fight has to go on anyway.”

Protesters have slammed what they label a “neoliberal” economic model that on the surface makes Chile seem like a Latin American economic success story but in reality masks a widely criticised pension, health and educations systems that give better benefits to the rich, who can afford to pay more.

Many protesters are demanding a new constitution to replace the 1980 charter written under General Augusto Pinochet’s 1973-1990 military dictatorship. It allows many social services and natural resources, including water, to be wholly or partially privatised.

From afar, Chile has been viewed a regional success story under democratically elected presidents on the left and right. A free-market consensus has driven growth up, poverty down and won Chile the Latin America’s highest score on the United Nations Human Development Index, a blend of life expectancy, education and national income per capita.


And in 2010, Chile became the second Latin member of the Organisation for Economic Cooperation and Development, after Mexico.

But a 2017 UN report found that the richest 1 per cent of Chileans earns 33 per cent of the nation’s wealth. That helps make Chile the most unequal country in the OECD, slightly worse than Mexico.

President Sebastian Pinera is a billionaire and one of the country’s richest men. Since the start of the protests, he has replaced the heads of several ministries with generally younger officials seen as more centrist and accessible and introduced a series of economic reforms, including increases in the minimum wage and lowest state pensions. But he has struggled to contain the protests and is facing calls to resign.

“The challenge for the movement is to keep the pressure on Pinera. As the government and the opposition are now negotiating reforms and Congress is advancing some of those reforms, there are high chances of the movement splitting into the more radical and the moderate wings,” said Patricio Navia, a political scientist at New York University.


“The radical wing wants Pinera to resign and the more moderate groups want to cash in and get some reforms passed that will have a positive impact on the lives of people, especially increases in pensions and the minimum wage,” he said.


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