Although it has weakened, Chile continues to dominate South America in the free economy, according to the 2021 edition of the Heritage Foundation’s Annual Index of Economic Freedom.
As reported According to the Wall Street Journal, Chile is also leading South America in the race for collective immunity from the COVID-19 pandemic.
These two developments are probably not a coincidence.
Chile’s overall ranking in the latest Economic Freedom Index fell to 21st out of 178 countries. Its economic freedom score of 75.2 was 1.6 points lower, mainly due to a decline in investment freedom.
Economic freedom in Chile has generally declined since 2013, when the country’s economy was about to join the ranks of Free, the first category of the Heritage Index. This year, Chile is even more firmly planted in the second category of most of the free.
The biggest threats to future economic freedom in Chile could emerge from the adoption of a new constitution that imposes higher taxes, higher public spending (including an expansion of the social protection system) and other laws which would have a negative impact on the indicators of the Heritage index.
Chile is the world’s largest producer of copper. Exports of minerals, timber, fruits, seafood, and wine drive growth in gross domestic product.
Back in power in 2018, President Sebastian Piñera, a center-right leader, faces stiff resistance from left-wing parties that control the Chilean Congress.
Piñera may have the last laugh, however, in light of a surge in popularity due to his skillful handling of the COVID-19 pandemic. The Washington Post writing:
Chile is now close to the first country to vaccinate its population against the virus. With more than 25% of its people having received at least one injection, the country of 19 million people on the South American Pacific coast is the champion of Latin America, and overall behind Israel, the United Arab Emirates and the United Arab Emirates. UK.
Immediately after the declaration of the pandemic in March 2020, Piñera ordered the formulation of a plan to vaccinate all Chileans.
As Vox reported, “The various ministries of Sebastian Piñera’s government – science and technology, health and international affairs, to name a few – all coordinated on a plan to seek safe and effective vaccines.
Why was this plan so successful?
Because Chile pathways to economic freedom with greater availability of money and resources. The The World Bank reports that Chile had the second per capita gross domestic product in South America in 2019 (the latest year available), after Uruguay.
>> What’s the best way for America to reopen and resume operations? The National Coronavirus Recovery Commission, a project of the Heritage Foundation, has brought together America’s best thinkers to figure it out. So far, it has made more than 260 recommendations. Learn more here.
The Washington Post reports that some political observers in Chile expect Piñera to enjoy an increase in its approval rate due to its outstanding performance in providing COVID-19 vaccines.
The Chilean president needs all the help he can get. Since taking up his post in March 2018, Piñera has been continuously criticized by political opponents. The relentless attacks from the left weighed heavily on its poll numbers.
Five months of violent protests in late 2019 and early 2020 left more than 30 dead. Widespread unrest, which prompted calls for the state to expand the social safety net, has had a negative impact on economic growth.
In a October 2020 referendum, nearly 80% of voters approved a proposal to rewrite or abandon the Chilean constitution.
The rewriting of the constitution is exactly how the late Hugo Chávez launched his hostile takeover of once democratic Venezuela in 1999 – under the guise of “21st century socialism.” Today, Chávez’s regime capo, Nicolás Maduro, wields an iron fist to rule Venezuela as a criminal enterprise, aided by numerous Cuban advisers.
Chavista’s acolytes imitated this path to seize authoritarian power in Bolivia (Evo Morales) and Ecuador (Rafael Correa), to the subsequent great misery of the citizens. It turns out that socialism in practice today does not work any better than in the former Soviet Union.
In the 2021 Economic Freedom Index, Chile continues to rank No. 2 out of 32 countries in the Americas region. Its overall score is well above regional and global averages.
Will the largely market-based and democratic system that produced this enviable result survive? The Chilean people will decide.