The first round of Chile’s presidential elections, which saw a near shoo-in billionaire stumble, has roiled the continent’s traditional pacesetter. The day after conservative former president Sebastian Pinera garnered less than 37 percent of the vote, the stock market took a powder.
Now Pinera faces a December runoff against Alejandro Guillier, a relative political newcomer, who’s bidding to unite the bickering but surprisingly resurgent Chilean left.
Yes, Chileans seem as tired of the same old faces in politics as everyone else in Latin America does. So is the continent’s most business-friendly nation about to bank hard left? Nah. Chileans long ago eschewed ideological extremes for a dull but stabilizing centrism. What’s at stake is whether any government can shake off more than a decade of economic inertia.
Chile hasn’t lost its preeminence. This Andean sliver of a nation of 18 million still leads in everything from free trade and quality of living to classroom performance. It trumps many of its neighbors for market friendliness, scoring 57 on the World Bank’s ease of doing business index, compared with Argentina (117) and Brazil (125). And thanks to a surge in growth and productivity starting in the 1980s, Chile debuted as the region’s first high-income nation in 2012.
The trouble is, Chile has been idling. The economy hit a rough patch, with growth falling from 1.6 percent in 2016 to a projected 1.1 percent this year, according to data compiled by Bloomberg Intelligence, below the regional average.
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