Original article: Experto internacional en macroeconomía desmiente crisis fiscal en Chile: “deuda externa es la más baja de la región”
Economist Daniel Titelman, Director of the Economic Development Division at ECLAC, described President Kast’s remarks about a supposed lack of fiscal resources as «very strange and imprecise.» In an interview with DW Channel, Titelman emphasized that the President inherited a country with an external debt level of around 41%, the lowest in Latin America and significantly lower compared to OECD countries and the developed world.
The specialist detailed that, although the real deficit has exceeded projections, with a current deficit of «2.8% of GDP» and a structural deficit of «3.8%», the situation is not fragile. «Indeed, we would all prefer to have fiscal accounts with a lower deficit, but it is a state with some fiscal constraints, yet a strong state, and a fiscal situation that is comparatively solid against any country in the region or beyond,» he affirmed.
Titelman emphasized that the decision not to ease the increase in prices is more a political criterion than a real restriction. «One will never completely stop the rise, but can smooth it out so that people have to pay more gradually over time, which has a lesser impact on quality of life and people’s wallets,» explained the director of ECLAC.
He concluded that, given Chile’s comparative fiscal solidity, «other resources could have been utilized» to mitigate the impact on citizens, noting that economic management leans «more toward a political decision than a decision dictated by fiscal accounts.»
See DW’s section analyzing Chile’s economy:
«The new Government passes the entire fuel price increase onto consumers»
