Hello, and welcome to the Latin America Weekly newsletter. In this issue: Boric’s reform package priorities in Chile, Paraguay’s soybean nightmare, and El Salvador’s spike in violence.
Boric’s new Finance Minister outlines economic reform roadmap
The naming of Mario Marcel as Chile’s new Finance Minister by the newly inaugurated President Gabriel Boric did a lot to assuage investors’ fears. Mr. Marcel’s long history as a centrist technocrat and his most recent five-year stint as Central Bank chief – throughout billionaire businessman Sebastián Piñera’s administration – were understood as reassuring by market analysts.
- But Mr. Boric’s ambitious campaign promises mean that Mr. Marcel’s term will face more challenges than your run-of-the-mill centrist Chilean minister. In his first visit to the House last week, Mr. Marcel outlined his roadmap for reform.
Tax reform. At the heart of Mr. Boric’s plan is his pledge to increase tax collection by 5 percent of GDP in order to significantly expand the role of the state in the economy. Mr. Marcel defended his stance, arguing that Chile is near the bottom of OECD countries in terms of total collection – above only Mexico and Colombia – and is the worst in terms of taxation’s effect in...