The Brookings Institution hosted Chilean President Michelle Bachelet June 23 for a discussion on Latin America and the global financial crisis.

The panel including Mauricio Cárdenas, director of the Latin America Initiative at Brookings, and Chilean Finance Minister Andrés Velasco analyzed the current economic conditions of Latin America and assessed the fiscal policy responses implemented by countries in the region.

"We decided for this year our priority will be how we respond to the crisis … so the crisis won't hurt the more vulnerable families," Bachelet stated.

Chile is seen as a model of economic stability and shrewd fiscal policy in this global crisis. High reserves, prudent investment and capital controls have enabled Chile to institute countercyclical initiatives aimed at stimulating the economy.

"Good economic policy and good social and environmental policy are one and the same," Bachelet said. "Social cohesion and green growth are goals that can and should go hand in hand. For this to happen, we must design such policies in a smart way, so that they can be financeable, sustained over time."

A large part of Chile's stimulus plan included education and unemployment assistance. Temporary tax rebates were also granted to promote private investment.

The Chilean leader highlighted investment in educational exchange programs such as the Equal Opportunities and Chile-California programs during her speech.

"We decided to invest in our people," Bachelet said. "And now we can send abroad a very high number of students that will help us to improve the capacity of our human capital – the capacities of our universities– and then we really could meet the goal of being a developed country in the future."

Environmental cooperation and clean energy were also on the agenda of the president's visit to Washington. She touted a newly signed agreement between the U.S. Energy Department and the Chilean National Energy Commission as a "shared interest" with the Obama administration.

Bachelet met Tuesday with U.S. President Barack Obama, who seeks stronger ties with Latin America.

She expressed guarded optimism about the region's prospects for economic recovery.

"We were tackling poverty," Bachelet said. "But now with the crisis, we might not only be able to advance, but also to relapse."She added: "I think it's very important that the social program fighting against poverty, and bringing more opportunities to everybody. I think that's the social area; it's also very important area of development between the relationship of the U.S. and Latin America."

About the author

  • Jody Nesbitt

    Jody is a Devex international correspondent in Washington, D.C. Previously, he worked as a monitor in South Africa's provincial parliament, as well as a researcher for the Center for Economic and Policy Research and for Glass Lewis & Co. He has studied at Rutgers University, the University of Natal and the University of the West Indies, earning a bachelor's in political science and a master's in international relations.