The Chilean model.

Author:Bamrud, Joachim

Nobel laureate Mario Vargas Llosa was right when he characterized Chile as a not-yet developed country, but one that is not a developing country either.

North Americans, Europeans and other South Americans are typically in awe when visiting Chile's capital Santiago for the first time. It's a city where things mostly work, with First World standards both in the private and public sector.

While much of that is due to Chileans' unique culture, credit also goes to the various governments the country has had in recent history and the overall policies they implemented.

For more than 20 years, Chile has been Latin America's freest country. It has had the region's freest economy, according to the index of economic freedom from the Heritage Foundation and Wall Street Journal. And it is one of only three countries in Latin America that shows full respect for political rights and civil liberties, according to Freedom House.

Chile has Latin America's most competitive economy, according to the World Economic Forum. When it comes to taxes, labor environment and transport infrastructure, it also beats out its Latin American neighbors, according to benchmarking indexes from Latin Business Chronicle. Chile is more transparent and has less corruption than the United States, according to German corruption watchdog Transparency International. It ranks as one of the three safest countries in Latin America, according to the Latin Security Index from FTI Consulting and Latin Business Chronicle, and is the regional leader when it comes to health and education, according to the 2010 Human Development Index from the United Nations Development Program (UNDP).

Chile's current president, Sebastian Pinera, has vowed to make Chile even more impressive. His overall goal is to boost economic growth to an annual average rate of 6 percent so that Chile can reach a GDP per capita on par with the average of the member countries of the Organization for Economic Co-operation and Development (OECD) by 2018.

Pinera's goal of boosting growth is part of a seven-point plan that includes the creation of one million new jobs, boosting the fight against crime and drug trafficking, eliminating extreme poverty and reducing the rates of inequality, improving the quality of health and education, modernizing the state and revitalizing democracy.


Although these goals are highly ambitious, Pinera may just be able to achieve them. Before...

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