By Richard Johnstone | 24 October 2013
The government of Chile could strengthen economic growth in the country by taking action to open up the job market to more women and young people, the Organisation for Economic Co-operation and Development has said.
The international body’s latest assessment of the nation’s economy said sound macroeconomic policies and a boom in commodity prices had helped Chile to an ‘enviable period of economic growth and job creation’. It projected the country’s economy will grow by 4.2% in 2013 and 4.5% in 2014, and said it remained optimistic about the state of the government spending. The country ran a surplus in its public finances in 2012.
In addition, per capita income has now crossed the threshold of $20,000, and is the highest in Latin America.
However, the economic survey, published yesterday, said labour market reforms could do more to make growth both more inclusive across the population and greener.
Although the think-tank said strong growth had helped more women and young people enter the labour force, their participation rates remain low when compared to most OECD and Latin American countries
Making job markets more inclusive should be a priority. Changing attitudes toward women’s work and parenting roles, as well as greater provision of childcare, would reduce barriers to female employment.
Extending the countries lower national minimum wage for young people – which currently applies to those under 18 – up to the age of 25 would help people get their first foothold in the workplace.
OECD secretary general Angel Gurría said Chile had made terrific gains since it joined the organisation in January 2010.
‘Its commitment to open trade and investment regimes, bringing it together with other major economies in the region via the Pacific Alliance is welcome,’ he added.
‘This commitment, along with sound public policies, will continue to support Chile’s economic convergence with the OECD average gross domestic product.
‘The challenge going forward is to ensure that the tremendous economic performance is shared among all Chileans.’
The OECD has also welcomed the country’s decision to sign up to international agreements on tax cooperation.
Chile today signed the Multilateral Convention on Mutual Administrative Assistance in Tax Matters, becoming the 59th signatory to the deal to boost cooperation between countries to tackle tax avoidance and evasion. The Chilean Congress must now ratify the OECD convention before it comes into force.
