World Statesman interviews Eduardo Frei, President of Chile

Military rule ended in 1990, but civil/military tensions have continued. How do you see the relationship between the civilian government and the military developing in coming years?

Relations between the government and the military will continue to develop, as they have done since the restoration of democracy, within the framework of the constitution and the law. Within this framework, we will continue to move forward towards a national defence policy. There certainly have been tensions, but these are only natural in a long transitional process. It was obvious, for example, that an action such as the imprisonment of ex-general Manual Contreras, who led the military government's intelligence services for a number of years, would revive tensions. We have resolved these tensions in accordance with our legislation, as it corresponds to the constitution, and we will continue to do so.

To what extent do the activities of human rights organisations influence your dealings with the military?

As I have said, relations with the military operate within the framework of the functions and faculties established by the constitution and by the legal system. Unresolved problems, such as that of missing prisoners of the old regime, are more national issues rather than the concern of single pressure groups. My government has tackled these problems by proposing to parliament a combination of legal initiatives. We expect these laws to be passed eventually, thus taking a substantial step towards reconciliation in our country.

What level of threat do the various militant left groups pose?

None. The political environment is not conducive to their development, and a number of leftist groups, of which the largest and oldest is the Socialist Party, belong to the Consensus of Political Parties for Democracy and are a part of government. All the groups and parties which take part in politics in accordance with democratic rules have complete freedom to act and do not represent any threat to the government. However, any extremist group, be it left- or right-wing, which acts outside of the constitution, will be confronted with the full force of the law.

The economy has performed strongly in recent years. Why?

There are a range of factors which make up the modern basis for economic development in Chile. Among these factors, the country's potential for natural resources stands out. Chile currently possesses around 25 per cent of the world's copper reserves, and its 5,000km of coastline has allowed us to establish the country as the world's fourth-largest fishing nation. We have 1.6 million hectares of cultivated forest, plus 7.5 million hectares of natural forests and a reforestation rate of 60,000 hectares a year. This has enabled us to establish Chile as one of the main producers of cellulose and paper in Latin America. Finally, our geographical position provides optimum conditions for fruit and vegetable cultivation and cereal production. We also enjoy benefits of access for our products to the northern hemisphere.

Beyond these factors, our current economic development can be explained by two components which are of fundamental importance. On the one hand, there is the presence of a powerful managerial class which is responsible and modern and which has participated fully in the economic changes seen here, and in Chile's entry into the international market. On the other hand, there is the consolidation of peace and social democracy in our country. The political, economic and social stability of recent years has been our principal guarantee of sustained development demonstrated, for example, in falling inflation, historically, and even internationally, low unemployment, responsible management of external finances and progress based on prudent and gradualist policies. This is precisely the framework which has enabled Chile to present itself to the rest of the world as a stable economy with plenty of opportunities for future development.

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Chile was one of the few countries in Latin America to escape the Mexican peso crash. Why?

I should point out first that we have followed with particular concern the diverse effects of the economic situation in Mexico. We believe that we cannot ignore its lessons. Nevertheless, the Chilean economy is currently very strong, and this has allowed it to withstand external pressures. The following characteristics in particular stand out: Another important factor is the deepening financial and commercial integration with the rest of the world.

Chile enjoys co-operation agreements with several countries in the region. How important are those regional trading links?

The Chilean economy has opened up to the rest of the world through reductions in customs laws, equal tariffs and the elimination of non-tariff measures. This situation, plus our current economic development, has increased the importance of Chile's relationship with foreign markets. Chile's links with other South American countries will remain important. Together, Mercosur and the Andean Pact countries represent 20.1 per cent of Chile's foreign trade and make up 17.4 per cent of our exports. I want to emphasise that, although large markets absorb our exports, mainly of raw materials, South Americans are the principal consumers of Chile's high-aggregate products. Our ties with other Latin American countries are strengthened by the growing investment of Chilean capital in the region; 84.5 per cent of Chilean capital investment abroad is concentrated in Latin America. According to figures from our Committee for Foreign Investment, up to August 1995 investment in Chile by other countries has also been significant (Argentina US$2,400 million; Peru US$581 million; Brazil US$185 million; Bolivia US$137 million).

The fact that our country has established itself as a forerunner in the principles of open markets - as much on a global as on a regional level - must also be taken into account. These principles, which have guided our foreign economic policy, are: Within this framework, Chile, along with other countries in the area, has implemented a series of important agreements, among them with Mexico, the Andean Pact countries and central America. In addition, our negotiations with Mercosur are already far advanced. These aim to secure a new type of relationship built on the basis of an association which, without leading to our incorporation into the group, boosts the process of economic integration in the region.

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©Kensington Publications 1996