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Weakening Chilean Economy to Test Bachelet's Social Reform Plans

  • Alejandro Marcano

Chilean President Michelle Bachelet took office in March with a pledge to make Chile a "different and fairer" country. But some of her key promises will be difficult to keep in a country facing increasingly difficult economic challenges.

Nothing will be easy for Bachelet during her second term as the nation's leader, after a landslide win in a December runoff vote.

The moderate socialist vowed to reform education and taxes. But that won't be easy in a nation with a slowing economy and tight budget.

Observers say Chileans, especially students, won't hesitate to take to the streets to demand she carry out the reforms.

"The people that voted for her, believing in all these promises, have already challenged her that if the promises are not fulfilled, as she has promised, [there] will be social upheaval in Chile," said Juan Larrain, Chile's former ambassador to the Organization of American States.

Chile's economic growth has slowed to nearly a four-year low, in part because of tumbling copper prices. Chile is a top copper exporter.

Despite the country's economic woes, Bachelet has promised to push ahead with her ambitious plan to carry out more than 50 reforms in her first 100 days in office.

"We have a commitment to the citizens to fulfill major policy goals and also to meet urgent tasks, and that we will do," she said.

At the center of reform agenda - providing free education to students all the way up to the university level.

"Although she does have a majority in the Congress right now, and I think she will be able to make some reforms, particularly in the educational system, I don't think they will be the kind of deep reforms that the students expect," said Jose Azel of the University of Miami. "And because the students are impatient, I think that will be her challenge going forward."

The president says she wants to help pay for education with funds from the country's copper wealth and by increasing corporate tax rates.

Bachelet says her sweeping reforms will shrink the big disparity between Chile's rich and poor citizens.

The president enjoyed huge approval ratings at the end her first term as president in 2010. But with a worsening economic outlook, it is unclear how she plans to implement the deep reforms she promised the voter base that returned her to office.

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