Chile sounds a warning signal across the region
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Chile sounds a warning signal across the region

The fiscal deterioration of Latin America’s former totem has more than just the pandemic behind it.

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Argentina’s negotiations with the IMF will focus minds in Latin America during the first quarter of 2022 – a deadline of March beckons if the country is to make good on a challenging debt repayment schedule.

Later in the year, its noisy neighbour, Brazil, will likely turn up the volume to 11 as its polarized, nasty presidential election campaign reaches fever pitch. Important general elections in Colombia and Costa Rica are also highly anticipated.

But it’s Chile that will be the most notable story for the region as a whole. Whereas the latest twists on the Argentina and Brazil stories recall the LatAm maxim “if you leave for 10 days everything changes, if you return after 10 years nothing has”, recent Chilean developments truly mark a departure for the country.

What’s changing – and why – reflects forces to which Latin America, and emerging markets globally, should be paying closer attention.

The impact of the violent demonstrations that rocked Chile in 2019 is still reverberating. Before 2022 even starts, we will have the outcome of a highly polarized election: with right-wing José Antonio Kast the candidate for those who regret the success of the social movement that prompted the fall not just of a government but of the country’s constitution.


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