Chile's Road to Economic Revitalization: Embracing Structural Reforms
Chile's economy, once a Latin American leader, faces slowed growth. The IMF suggests structural reforms to improve investment, labor force participation, and research collaboration. Demographic shifts and external challenges could cap growth at 1.9% annually. Efforts may include enhancing childcare access and technology transfer.
The International Monetary Fund has projected that Chile could boost its economic growth by implementing crucial structural reforms. These reforms could enhance investment efficiency, increase labor force participation, and encourage public-private sector research collaboration.
Chile, which once boasted an annual growth rate of 6.2% in the 1990s, now faces a slowdown, with growth dipping below 2% in the 2020s. This deceleration has sparked intense debates over fiscal sustainability and the viability of social systems such as pensions and university loans.
Chile's GDP per capita has impressively risen from $8,200 in 1990 to $26,000 by 2025. However, persistent demographic trends and global economic conditions threaten to restrain future growth, with the working-age population growing by only 0.15% annually till 2035. The IMF emphasizes stimulating labor participation and improving access to childcare, which can empower more women to join the workforce. In response, a series of proposed reforms, such as passing a technology transfer bill and streamlining investment approvals, aim to leverage Chile's mineral and energy resources for sustained growth.
(With inputs from agencies.)
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