CHILE HAS BECOME THE RECORD HOLDER FOR INFLATION IN LATIN AMERICA

Inflation is actively hitting the economies of not only developed, but also developing countries. In many of them, the inflation rate is becoming a record, updating the data of previous years. The main factor for developed countries is the rise in the cost of fuel and food. The economies of developing countries have additional reasons for rising prices.

Among the countries of Latin America and the Caribbean, the Republic of Chile took the first place in terms of inflation. In May, its level reached 11.5% for the first time since July 1994. Chile, as a global producer and exporter of copper, is suffering greatly from the global economic downturn. According to the OECD, Chile was followed by Colombia and Costa Rica with indicators of 9.1% and 8.7%, respectively.

Globally, Chile is only in eighth place by this criterion. Here, Turkey is far ahead among all countries with an inflation rate of 73.5%. It is followed by the Baltic countries by a large margin: in Estonia, Lithuania and Latvia, the inflation rate, according to the OECD, was 20%, 18.9% and 16.9%. Three more countries that showed record results are the Czech Republic, Poland and Slovakia, where prices increased by 16%, 13.9% and 12.6% year–on-year.

According to experts, one of the reasons for the weakening of Chile's hitherto stable economy was the shortage of energy resources and the consequences of the pandemic.

In conditions of exceeding the target range that the Central Bank has planned for inflation, interest rates are rising in the country. As the head of the republic Gabriel Borich noted earlier, domestic political factors also influence the situation in the economy.

According to the President, there remains uncertainty in society regarding the constitutional reform, which should make serious changes in the lives of Chileans. A referendum on the adoption of amendments is to be held on September 4.

If the people accept the 388 points that were submitted earlier for discussion, the country will break with the charter adopted 42 years ago during the Pinochet military dictatorship.

The new law prepared by the Constitutional Assembly guarantees equality of rights for all segments of the population, promising to establish a social rule of law state.

This process may be influenced by the economic state of the state. An indicator of this is the recent strike of workers employed in the copper industry. Its reason was the decision to close the Codelco Ventanas plant later. The company's management noted that production was not affected due to the strike, affecting only hundreds of workers. A total of 1,159 employees are employed at the plant.

 

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