Consolidating democracy. Any populist phantoms around?

The presidential campaign has been unleashed and with it goes the traditional battle for power.  This is not different from any other presidential race Chile has had since the start of democratic times with Aylwin as President in 1990.   It has been 25 years of transition to the democratic game and 2 coalitions have been circling and taking posts for the Presidential seat. However, the end of a stable political cycle - with most presidential terms ruled by the center-left coalition, ex Concertación de Partidos Por la Democracia, today Nueva Mayorìa - is facing all the challenges brought about by the end of a stable cycle with the beginning of a new political era. In this new era, post-transition times, empowered middle-classes press the state to tackle disparities in the wake of 25 years of steady growth but uneven distribution of wealth.  Country Risk Chile analyses the possible scenarios with three frontrunners for the Presidency, March 2018.  This analysis takes into account the risk and opportunity that each candidate brings to the political landscape against the backdrop of economic slowdown, productivity issues, social change and citizen's disaffection with political parties. 

What do they bring to the opportunity side and why? What is their Achilles' heel and why? 

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2016 - The year of productivity in Chile

As part of our weekly monitoring on Country Risk Chile’s top 5 political risks 2016, we bring a fresh analysis on risk Nr 5, Productivity.  This week, we analyze the public and private initiatives to foster growth and productivity against the negative external scenario of low record copper prices, China's economic slowdown, an appreciated dollar and the impact of second-generations reforms - led by the center-left Nueva Mayoría coalition- on investors' confidence.  

On March 31st, Chilean Finance Minister,  Rodrigo Valdés, announced the implementation of 22 measures as part of the 2016 Chilean Agenda for Growth and Productivity declared by President Michelle Bachelet.  Alongside these 22 measures,  the Chilean CPC (Confederation of Productivity and Commerce, comprising the local entrepreneurs) came up with 109 additional measures to boost growth.  There is a widespread concern as well as an agreement that the country needs to re-direct efforts on growth and minimize the impact of second-generation reforms on investors' confidence.  Both government authorities and local entrepreneurs agree on the urgent need to find new strategies to deal with external factors such as the end of the commodities boom,  the appreciated dollar and low record copper price,  especially when the Chinese are shifting their economy - from being a giant consumer of raw materials to playing a major role in the service market.   Macroeconomic factors and the uncertainty triggered by internal reforms are compelling authorities and local entrepreneurs to analyze strategies to recover the path of sustainable growth that Chile has enjoyed in this 25-year political cycle and ensure its usual resilience at a time of volatility.  What is new in this regard is the inclusion of advanced human capital in the Agenda and general recognition about improving educational variables for the first time amongst local capital stakeholders. 

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