President of Chile Michelle Bachelet Honored at AS/COA

In recognition of the economic and social achievements of the Chilean government at a time of global economic crisis, the Americas Society honored Chilean President Michelle Bachelet with the Gold Insigne award during a September 23 dinner reception. During her remarks, the president reviewed the steps taken under her leadership to consolidate democracy and safeguard Chile’s economy. She also described her vision for the country’s future. “In the years ahead, our goal is an ambitious one, although feasible and very clear: Chile will emerge from this crisis with renewed strength to continue its path toward development,” said Bachelet. “Chile is in a position to become a developed economy over the course of one generation and it is determined to do so.”

Recent indicators show that the Bachelet government’s countercyclical policies helped safeguard the country’s economy. The president pointed out that the International Monetary Fund forecast that Chile’s economy would contract by 0.7 percent in 2009 and grow by 3.6 percent in 2010. Chile’s Central Bank predicted a 1.5 percent contraction this year and as much as 5.5 percent growth rate in 2010. She stressed the large number of trade agreements and Chile’s position as a gateway between Asia and Latin America as contributing factors to the country’s successes.

Bachelet attributed the quick recovery to the decision to save when the price of copper ran high. $22 billion of savings allowed the country to put in place a stimulus plan equivalent to 2.95 percent of GDP. As a result, her government could increase social expenditures by as much as 7.8 percent at a time of negative growth. “We could increase our social expenditure when we were being hit hardest by the crisis and when [Chileans] needed it most,” said Bachelet. The president, whose approval ratings are among the highest of Latin American leaders, said this demonstrated an important point: “You can be popular without being a populist.”

While growth serves as one pillar of Chile’s strength, equity serves as the second, said the president. Chilean poverty rates dropped from 40 to less than 14 percent between 1990 and 2006. She noted that saving during “fat years” ensured that the country could have enough during “lean years,” thereby “guaranteeing social rights over time.”

But she also warned of challenges facing Latin America as a result of the food and economic crises. Te number of people suffering from hunger in the region rose from 52 million to 56 million between 2006 and 2008, she said. Moreover, between 2.8 and 3.9 million people could join the 15.9 million urban unemployed this year.

“The challenges are huge although not insurmountable,” said Bachelet. “There are several countries in our own region that have demonstrated that we can succeed and Chile has done so.” In closing, she urged optimism about Latin America and the U.S.-Latin American relationship.

President Bachelet was awarded Americas Society’s highest honor, the Gold Insigne, for her remarkable achievements. The award is given each year to a democratically elected hemispheric leader. During the awards ceremony, AS/COA President and CEO Susan Segal remarked: “President Bachelet’s legacy will be one of extraordinary regional leadership in a time of crisis and the achievement of sound economic management and social gains at home. Under her leadership, all Chileans can look to a brighter future.”