August 1, 2020
Investment
coronavirus
Official Information

President Piñera announces a reactivation plan to help recover 1.8 million lost jobs: “The difference between a dream and a mission lies in willpower, courage and commitment”

President Piñera announces a reactivation plan to help recover 1.8 million lost jobs: “The difference between a dream and a mission lies in willpower, courage and commitment”
In his third State of the Nation Address, the President announced a recovery plan for Chile called ‘Paso a Paso, Chile se Recupera’ (step by step, Chile recovers). It entails US$34 billion in public investment over the period 2020-2022.

President Sebastián Piñera announced on Friday a reactivation plan to help recover the 1.8 million jobs lost during the coronavirus pandemic and world recession.

“The difference between a dream and a mission lies in the willpower, courage and commitment with which we are taking on this mission,” said the President during his address in Chile’s National Congress building. He was accompanied by First Lady Cecilia Morel and state ministers.

The President announced an urgent, large-scale employment subsidy plan that could benefit up to a million people and will cost around US$2 billion.

He also announced a robust plan of public investment in physical, social and digital infrastructure, prioritizing cities and housing, highways and roads, ports and airports, potable water, irrigation and reservoirs, hospitals and outpatient clinics, educational establishments, public transportation, parks, sports and cultural centers, digital networks and resources for regions and municipalities.

Public investment for the period 2020-2022 will therefore total US$34 billion, US$4.5 billion of which is additional investment. This could generate 250,000 new jobs, with public works being developed in every region of Chile in a decentralized manner.

The President also highlighted the support being provided to small and medium-sized companies through the Fogape (general small investment guarantee fund), and the Crece (growth) and Reactivate (reactivate) programs, in the form of subsidies, technical assistance and access to state-guaranteed working capital loans. So far some 200,000 companies — 190,000 of them SMEs — have accessed the FOGAPE program, for a total amount of US$10 billion.

President Piñera announced tax incentives for private investment, representing close to 80% of the total amount invested. He also announced the speeding up of 130 private investment projects totaling US$21 billion, which have the capacity to create 120,000 direct jobs. The Concessions Program of the Public Works Ministry is also to be strengthened and streamlined.

The plan includes a special program to simplify paperwork and facilitate permits in order to stimulate and accelerate investment, entrepreneurship and economic recovery. 

“The recovery of those jobs that have been lost or put on hold is a key objective of the Recovery Plan, and should be a source of unity and motivation for all Chileans,” said the President.

The President also announced the enactment of the law to make it easier to access the Emergency Family Income (Ingreso Familiar de Emergencia). This widens and extends the benefit to include senior citizens who receive the Basic Solidarity Pension (Pensión Básica Solidaria or PBS) and all those who receive the Pension Solidarity Complement (Aporte Previsional Solidario or APS), whose pension is not in excess of the Basic Solidarity Pension. At the moment 2.4 million families and 6.5 million people — that is 1 out of every 3 Chileans — are receiving the Emergency Family Income. This change means that 320,000 additional families, who have been affected by the pandemic but have not so far received this benefit, will also get the help and relief they really need and deserve.

The President also announced that the Middle Class Protection Law has been enacted. This law sets up a bonus payment of 500,000 Chilean pesos (around US$660) and a solidarity loan, which will benefit more than 1.6 million Chileans. The payment of this bonus will begin in the coming days. 

The President highlighted the social protection network, which has been designed to cover up to 14 million people, safeguarding their income and jobs for the duration of the Coronavirus crisis. It includes the following measures: the COVID-19 Bonus; the Guaranteed Minimum Income (Ingreso Mínimo Garantizado); subsidy and finance programs for SMEs; the Employment Protection Law; the strengthening of unemployment insurance; the Emergency Family Income I and II; the small business loans provided through Fogape; the income support for freelance workers who issue boletas de honorarios (invoices for services rendered); the distribution of 5.5 million food boxes; the Reinforced Middle Class Protection Plan (Plan Reforzado para la Protección de la Clase Media), the Protected Parenting Law; and rental subsidies. Through this network, Chile is protecting 3 out of every 4 citizens.

The President also called for a Pensions Agreement to move forward with a wholesale and far-reaching reform of the pensions of all Chileans.

“This is what our Government genuinely wishes and it is what our fellow Chileans deserve,” said the President.  

The President recognized the impact the pandemic has had on Chilean families. He also praised the role of healthcare and public sector workers and highlighted the health protection plan implemented to address Covid-19.

“The Chilean people — a people forged by the rigor of hard work and the mettle of adversity — has always, always, managed to get back up on its feet, wipe off its tears and start moving forward again, retaking the road towards a better future,” said the President.

The President also welcomed the agreements reached on peace, the constitution, institutional strengthening and social justice.

“There is far more that unites us than that which divides us. We are united by our heroes and national symbols, our culture and history, our traditions and customs, our geography and landscapes, our earth and our people, and, above all, by a whole future that we are building together,” the President said.