Chile: the balanced view : a recopilation of articles about the Allende years and after

corresponding to 1973 and 1974, 50 '10 of the product OT all programmed exports would have to go towards it. So as lo face this situation responsibly, Chile has adopted a sel of exchange and tarih policies which will guarantee an efficient distribution of resources together with an increase and diversification of exports. The exchange policy consists basically of ma¡ntai– ning the real value of hard currency by means of a scheme of small, periodic and sudden devaluations. On the other hand, the tariff policy consists of producing a gradual general reduction incustoms taxes, so as to end negative protection of export activities, which are· those il is hoped lo encourage, and greatly reducing the protection of national industry, thus forcing it to gradually submit to foreign competition and to improve its efficiency patterns. The recovery of the internal productive activity will also help, from 1975 on, to over– come part of the problems of the commercial balance, as a big increase in copper production and in agriculture is expected. As to the over-all situation of the balance of payments, the final result will depend on the conditions in which the international community is prepared to help the national endeavours, relieving the foreign debt's situation, derived from its size and concentration. At this point it seems convenient to point out that, as well as the problems just described, Chile is faced, together with all the world community, with the internal and external effects of the actual international alliances, and which can be seen in the higher prices of oil, freights, food an other products. As an example, in 1974 it is expected that importation costs will increase by about 250 million US dollars, only because of higher prices. 4. The Over-all Pattem The forementioned policies make up a compatible short-term program which, if adequate foreign aid is forthcoming, will mean a general increase in production, an increase in employment, an improvement in the worker's situation, and a reduction of inflation. Given these aims, the program depends basically on internal endeavours, shared by all, and which, complemented by the described policies, permit an estimate of about 8.% increase of the product tor 1974. This increase can be expressed on the demand side by a big increase in investment, and an estimated increase in privateconsumption ofabout6'Y" , which must contrast with the fall shown by the consumption of 1973, which is estimated at 3% In any case, and lastly, it must be noted that one of the basic characteristics of the program is its flexibility. AII the policies have been made in such awaythat the route to the recovery of the economy is the corret one. We believe it impossible, in a country just emerging from the worst crisis of its history, to define goals or objectives more ambitious and or precise than these. We are only beginning the process of national reconstruction, with firm steps, but without aspiring to overcome all the problems in one year. IV. AIMS AND PROGRAMS OF THE GOVERNMENT When defining the fundamental objectives of the Chilean Government, undoubtedly first place must go to the effective incorporation of all the citizenry to the orocess of national development. When expressed in this way, this aim would seem too general, and too universal, but in the Chilean case its application has a very concrete purpose, because we are just emer– ging from a long period in which the State's actions have been characterized by an ever-growing paternalism. The State now looks for ways of handing over the maximum of responsibilities to the 209