Guillier ‘forgets’ Populist stance to woo foreign investors

SANTIAGO – Chile’s presidential hopeful Alejandro Guillier has assured the business community that they would have nothing to fear from his administration.

His statement comes two months after U.S. investment company JP Morgan said investors were shunning Chile because of Guillier’s populist stance and his rise in the opinion polls.

“I have never been characterized by extreme policies,” Guillier said in a 90 minute interview with Bloomberg in Santiago. “I am an eternal negotiator.”

Guillier fueled concern about populism last year when he described the $181 billion private pension-fund system as “ruinous,” saying it forced many people into poverty, sparking speculation that he backed elimination of the privately managed funds.

The comments came as some in the business community blamed the government’s decision to raise taxes and empower labor unions for the slowest three years of growth since the earlier 1980s. Guillier seemed to threaten a deepening of those reforms.

However, Bloomberg’s Javiera Quiroga finds Guillier’s rhetoric has toned down as he puts together a team of economic advisers, most of whom have post-grad degrees from the U.S. or the U.K.

He also ruled out increased tax burden and an end to private pension fund managers, under his administration. Far from calling for the elimination of private pension funds, Guillier merely said they should face more competition to cut costs for clients. “Whatever the final reform to the pension system, the government must look for a consensus,” he said.

Still, he did call for greater negotiating powers for workers to revert the “concentration of wealth” in Chile.

Guillier says his government would boost efficiency, encourage innovation, diversify the economy and promote more value-added goods.

Asked whether Chile needed another tax reform to raise more funds for the state, Guillier said the system could be simplified and changed to encourage more investment, but that there was no appetite for increased taxes. “Investors don’t like the rules of the game to be changed every five minutes,” Guillier said.

The former TV pundit and current senator for Antofagasta announced his candidacy on Jan. 7 and plans to run in primaries for the center-left ruling coalition in July, ahead of the presidential election in November. For now, opinion polls show he is second only to former president and de-facto leader of the opposition Sebastian Pinera.