US Markets

Chile finance minister announces new stimulus to kickstart sputtering economy

Credit: REUTERS/Rodrigo Garrido

Chile's Finance Minister announced on Monday $600 million in additional stimulus in an effort to kick-start the top copper producer's sputtering economy, which has suffered from a downturn in mining and global trade tensions.

By Natalia A. Ramos Miranda

SANTIAGO, Aug 26 (Reuters) - Chile's Finance Minister announced on Monday $600 million in additional stimulus in an effort to kick-start the top copper producer's sputtering economy, which has suffered from a downturn in mining and global trade tensions.

Finance Minister Felipe Larrain said the administration of center-right President Sebastian Pinera planned to inject the funding, drawn from elsewhere in the country's budget, into road construction, subsidized housing, healthcare and water projects through 2020.

"The trade wars have worsened and Chile is not immune," Larrain told reporters.

Chile, which produces nearly one-third the world's copper, has suffered amid floundering global prices for the red metal. Heavy rains in the country's normally parched northern desert, home to many of its mines, labor strife and a blistering drought in its central agricultural region have also taken their toll.

Larrain said $63 million was earmarked for irrigation projects intended to help ease the pain of drought in central Chile, a region rich in vineyards and other fruit production.

Chilean officials have repeatedly downgraded expectations for growth in 2019, prompting the Pinera administration to implement $3 billion in new stimulus projects over the past several months.

Larrain in July estimated the economy would grow 3.2% in 2019, down from a previous estimate of 3.5% in April.

(Reporting by Natalia Ramos; Writing by Dave Sherwood; Editing by Sandra Maler)

((dave.sherwood@thomsonreuters.com; +56 9 9138 1047, +56 2 2370 4224; Reuters Messaging: dave.sherwood.thomsonreuters.com@reuters.net))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Latest Markets Videos

    Reuters

    Reuters, the news and media division of Thomson Reuters, is the world’s largest international multimedia news provider reaching more than one billion people every day. Reuters provides trusted business, financial, national, and international news to professionals via Thomson Reuters desktops, the world's media organizations, and directly to consumers at Reuters.com and via Reuters TV.

    Learn More