The Ministry of Finance reported that it made a withdrawal of US$ 447 million from the Economic and Social Stabilization Fund (FEES) on September 10, 2021. According to Teatinos 120 in a statement, this withdrawal will be used to amortize debt and is in addition to those made in April, June, July and August for US $ 1,750 million, US $ 2,000 million, US $ 1,000 million, and US $ 1,000 respectively, totaling US $ 6,197 million so far this year.
It is estimated that the market value of the FEES at the end of September will be close to US$ 2.5 billion.
It is worth mentioning that in response to the need for financing of the Economic and Social Reactivation Plan announced on Tuesday, August 10, additional withdrawals from the FEES will be evaluated in terms of opportunity and amount at the time of updating the macroeconomic and fiscal estimates on the occasion of the start of the processing of the 2022 Budget Bill.
Likewise, during 2020 withdrawals were made from the fund for US $ 4,090 million, resources that were also used to support the financing needs associated with the pandemic and the social crisis of the end of 2019.
In accordance with the fiscal institutions of the Republic of Chile, fiscal policy is guided by the Structural Balance Sheet, which reflects the trending financial situation of the Central Government, excluding the effect on public finances of cyclical fluctuations in economic activity and the price of copper.
For its part, the FEES is an additional source of financing for the Central Government that allows financing fiscal deficits, the annual contribution to the Pension Reserve Fund, and amortization of the public debt. Although the Republic of Chile has wide access to financing in international markets on competitive terms, the use of the FEES has the advantage of allowing the financing of fiscal needs by reducing the need to resort to public debt.
In this context, the Structural Balance rule saved significant resources in the FEES in the past and now allows Chile to be better positioned than many countries in the world to deal with the effects that the coronavirus will have on the Chilean economy.
