The slow-motion fall of Macri hits Chile: the impact of the Argentinean turmoil in the Chilean economic & political landscape

Por TOMÁS CROQUEVIELLE H.

Licenciado en Historia y Periodista

Pontificia Universidad Católica de Chile


The results of the primary elections in Argentina and the instability generated have the potential to affect Chile’s economic and political landscape. Recent history of both countries indicates that what happens on one side of the Andes can affect what happens on the other side.

Like the Argentinian President, Mauricio Macri, the Chilean firms in Argentina are not having a good time. The left-wing candidate, the Kichnerist Alberto Fernández, had a crushing and surprising victory over the mandatary of Argentina in the last primary elections, which in the trans-Andean country are called Primarias Abiertas Simultáneas y Obligatorias (Simultaneous and mandatory open primaries, PASO). A disastrous result for the markets and the Chilean private interests.

Fernandez, who has the former President, Cristina Fernández de Kirchner, as his running mate took almost 48% of the vote, compared to 32% for President Macri. If those results were repeated in October 27th (when the real presidential election is going to take place), the opposition-Peronist candidate would take the presidency without the need of a runoff election. 

The immediate effects of the elections were the increase of uncertainty in Argentina and in the countries of the region such as Brazil and Chile, which negatively affected companies with presence and investment in the country, at the same time that the loss of purchasing power of Argentinians will mean a fall in Chile’s exports to that country and a significant decrease in Argentine tourist trips to Chile.

Restless Chilean investments

In Argentina retail and airlines are economic sectors with a very important presence of Chilean capital and investment, and both of those were very affected by the rapid collapse of the stock market, the devaluation of the Argentine peso and the increase in economic insecurity.

It should be remembered that during the administration of Cristina Fernández de Kirchner the pension funds were nationalized, currency controls were imposed, meanwhile her administration was accused of economic statistics manipulation. All measures that don’t follow the traditional management playbook of the current liberal economy.

Therefore, several economists and analysts fear a repetition of the liquidity problems and exchange controls, among several other setbacks, experienced during her administration.

The uncertainty that leaves the possible return of leftist and populist policies of Cristina Fernández, together with the power vacuum of a president who has to still govern until  December 10th, sharpens the volatility that is already in place thanks to the economic war between the U.S and China, discouraging investment and adding instability to an international economic context with different indicators towards a global slowdown.

Nervousness in La Moneda

Faced with this complex political-economic situation, La Moneda has reacted with caution. After the election results, President Sebastián Piñera indicated that “each country makes its own decisions” stating that unlike the Argentinean economy the Chilean economy is growing although he recognized an effect of the volatility of Argentina in Chile.

Meanwhile Piñera’s administration has come to mark differences between the situation of his administration compared to the Argentinian president, whereas does the opposition. Some politicians, have raised parallels in response to the election, “Like President Piñera , during his campaign, Macri promised a sustained growth of the economy, and the results are being bad. That shows that when the presidents do not fulfill their promises, they have bad election results” sated Alvaro Elizalde, president of the opposition Socialist Party.

We can’t forget that Macri is a political leader who has many similarities with Piñera: both are successful businessmen who enter politics, and both led the most popular football teams in their countries, Boca Juniors and Colo Colo. An Alignment that has been reflected especially in the international concert with the Venezuelan issue.

A convergent History

Although throughout theirs histories the politics of Chile and Argentina have shown independent logics the political history of both countries have had numerous episodes of convergence.

Famous was the episode of 1953 in which the former President, General Carlos Ibañez del Campo (1927-1931 & 1952-1958) and the President,  General Juan Domingo Perón (1946-1955 & 1973-1974) symbolized their political closeness with a hug. Both were populist leaders with a military origin and a corporatist and nationalist ideology which sought a third way between capitalism and socialism.

On the other hand, the state coup d’etat of 1973 against the Allende government was a clear antecedent of the 1976 overthrow of the presidency of Isabel Perón and both seizures of power were driven by an anti-communism ideology and a neoliberal agenda that led to the massive privatizations in both sides of the Andes.

During the 90s, Chile and Argentina carried out a deepening of their neoliberal model inherited from their respective military dictatorships, this time under the democratic management of the Centre left-wing presidents; Patricio Aylwin (1990-1994) and Eduardo Frei (1994-2000) in the Chilean case and Raúl Alfonsín (1983-1989) and Carlos Menem (1989-1999) in the Argentine one.

A trend that in Argentina was reversed in 2003 when Nestor Kirchner was elected president. Later the election of the senator Cristina Fernández (the first lady of Nestor Kirchner) in 2007 as president consolidated that turn to the left. Regarding this, the election of the first woman President in Argentinean lands was preceded in 2006 by the election of the socialist Michelle Bachelet (2006-2010 & 2014-2108) to the presidency of Chile, also the first woman elected to that office in the country’s history.

The recent turn to the right from different Latin American countries began, to a large extent, with the victory of the then right-wing mayor of Buenos Aires, Mauricio Macri, in 2015, a victory that undoubtedly was a momentum to the return of Piñera to the presidency. It remains to be seen if the, almost certainly, end of the Macri’s political cycle can be understood as the prelude of a political change in Chile.


*Imagen de cabecera propiedad de Df.

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