“This is exactly a turbulence that comes from the outside and that as we talked weeks ago It was in full gestation. And what I’m thinking about then is that first, when you evaluate the behavior of the Chilean economy over the last two years on average, it’s clearly been much better than the behavior of the previous four years. This is the comparisons of government to government,” the Economy Minister, Juan Andrés Fontaine, said this morning about the current economic situation, which contrasts with the optimism he showed a few weeks ago. “Economies move a lot based on expectations because expectations far determine whether or not people go to malls to buy and when they encourage themselves to buy more, they revive the economy, productive activity and that creates more employment opportunities.”
“We have improved but it is not to say that we are jajah yourselves, because indeed there has been a deterioration in expectations that opens a question about how the future is coming and there is a change in the global climate that varies from partial to cloudy and that we p reoccupy,” he said on Radio Universo.
He highlighted the rate cut by the Central Bank and said that “we are not at all in a crisis, we are in a slowdown, in a cooling of the world economy and Chile is a very sensitive country of what happens outside.”
“The BC is autonomous from making its decisions and takes them looking at the outlook of inflation and that outlook is seeing it very calm, inflation very low control and has made this decision that I applaud because it has this positive effect on the econ activity “Ominous,” he said.
At the consultation of what is a message to the ordinary citizen, Fontaine replied that “there is no reason for alarm, for pessimism. That there are clouds in the global echo there are, but we have an economy with the capacity to face unfavourable external conditions, we have a government that is taking the necessary measures both in fiscal policy and to incentivize investment and productivity.”
To consumers the minister told “to make their spending decisions wisely, realistically but without getting carried away by an environment, these depressive average waves. People have to make decisions cautiously, seriously.” “In my long life as a Chilean echo scholar I would never have imagined that I would see mortgage loans at 2.5% or 3% over UF,” he said. “I call prudence, I’m not saying it’s time to go into debt to fools and crazy, but these are conditions that for well-thought-out and well-realistic decisions are timely to buy durable goods or homes.”
Disappointment
“Times have improved substantially over the previous government. And we are facing two problems: one, the world economy and the second is that there is a disappointment that I perceive in our entrepreneurs in our consumers about the ability of the political system to assume with the sense of urgency that the reforms deserve necessary to grow. I sense that feeling, that disappointment,” Fontaine said.
On the 40-hour project that is advancing in Congress, he said that such an idea has consequences not only for people’s lives, that everyone aspires to a shorter day but that must be balanced with income. “It’s very difficult to achieve that balance.” “The increase in labour costs that is raised (by the project), coupled with the increase in pension improvement, is so strong that (it will) be increased by up to 29% of aboral costs in five or eight years. It’s going to mean that it’s going to be impossible to increase labor income throughout that period. It puts the whole problem in black and white.”
He said he is not in favour of censoring the discussions but was concerned about “the resolution.”
