Chile president-elect says planned reforms won't hit private sector

Chile president-elect says planned reforms won
# 18 December 2013 02:48 (UTC +04:00)

Baku-APA. Sweeping reforms planned by Chile's center-left president-elect Michelle Bachelet will not threaten the private sector, she said after her electoral victory at the weekend, APA reports quoting Reuters.

Bachelet, whose coalition ranges from moderate left Christian Democrats to militant Communists, will return to the presidency of the South American nation in March after a landslide second round win on Sunday.

She campaigned on a slate of addressing deep inequality in Chile by hiking corporate taxes to pay for reforms such as a gradual move to free higher education.

Some analysts have raised concerns that Bachelet's return after the conservative government of Sebastian Pinera will mean a shift to less investor-friendly policies in the top copper exporter.

"None of the reforms that we are planning...are a threat either to the private sector or to anyone in this country," she said at a press conference with foreign correspondents on Tuesday.

Market reaction to her win on Monday had been "extremely positive," said Bachelet, who previously governed Chile between 2006 and 2010.

"I think that reflects that I am a president elect but that I had a prior government with a fiscally responsible attitude, with an understanding that as well as a need for a strong, efficient state...we also need a dynamic private sector."

Reaction in the markets to her election was muted on Monday, with traders saying her victory had been largely priced in.

"While the overall direction of economic policy is unlikely to change much, risks however will increase for the private sector due to higher taxes and more stringent regulation," Eurasia Group analyst Daniel Kerner wrote on Tuesday.

Economic growth has been slowing in the Andean country, as robust domestic demand and copper prices ease.

The three key planks of Bachelet's program are tax reform, education reform, and a new constitution. The first two would be sent to Congress within her first hundred days, she said, expressing optimism that she will garner enough support in Congress to get the bills through.

Tackling changes to the constitution is planned for the second half of 2014, said Bachelet. That will require a greater majority than her coalition commands in Congress and so will be hardest to achieve.

"That's a different situation," she acknowledged.

"We are going to prepare the bill and establish a mechanism to make quick progress in our government so hopefully we have the new constitution ready during our government."