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In the midst of gloomy forecasts regarding the economic effects of the health crisis, the economist and former president of the Central Bank, Vittorio Corbo, put a bit of optimism, noting that “Chileans are going to have less trouble than other” countries of the region.
When comparing the local macroeconomic position with respect to other nations in the region, Corbo maintained –in an interview with Infinite Radio– that the economic activity of Chile will contract between 3% and 5%, according to data from national and international organizations, while Peru, for example, will suffer a drop of 8% and 10%, Mexico about 10% and Brazil between 6% and 10%.
In fact, this afternoon a new estimate was released, corresponding to the Fitch agency, which projected a reduction in Chile’s growth prospects from -1.9% to -3.9%. The agency had a worse prognosis, from -2% to -4.5%, in the case of Colombia.
In Corbo’s opinion, Chile’s response capacity is explained by “this model that has allowed us to navigate very well”, based on macroeconomic and fiscal solidity. This is associated with positive government management, he stressed. “The authority has moved in the right direction,” he said.
As for the measures adopted by the Executive, Corbo stressed that “here are subsidies that will reach the people,” and most likely there will be new aid packages. “I wish they were more, but we have to see how public finances fit in, because the wallet is not infinite,” he said.
In this framework, the economist aligned himself with the Treasury’s strategy of gradually responding with new packages. “There is a lot of uncertainty, you don’t have to use all the bullets (…), what the authority has to do is calibrate, they can’t throw all the meat on the grill (…), don’t be nervous,” he added. .
Central’s objectives
Meanwhile, the director of the Central Bank, Alberto Naudon, commented on Cooperative Radio the focus of the issuing institute in this crisis, with the goal set that “this unemployment in economic activity does not transform or does not generate permanent effects on the economy”.
“Now there are two great objectives in economic policy. One is that the quality of life of the people does not fall below a certain level that we could call worrying, that is in the hands of the Government, how to support the most complicated people so that they can go through this bump in a more dignified way ”, he indicated.
“The second objective,” he added, “is that when the pandemic passes, the permanent damage to the economy is as few as possible (…), that when the pandemic ends, people return to work and their company is there; that companies want to sell and their Customers are there, so that people who want to finance a project can go to the bank and not have the burden of being close to bankruptcy and don’t lend them money. ”
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