Chile’s Pinera Fires Top Economic Ministers Amid Protests

(Bloomberg) -- Ten days of riots, protests and reprisals claimed their first political victims Monday as Chile’s President Sebastian Pinera fired eight ministers, including the biggest hitters in the cabinet.

The interior, finance and economy ministers were all dismissed, with Pinera naming a younger, more centrist team to convince protesters that their voice has been heard.

A wave of riots, looting and protests has caused more than a billion dollars of damage this month, before spawning the largest peaceful demonstration in the country’s history. Yet, today’s announcement is unlikely to placate a movement that has demands ranging from tax reform to constitutional change, via the resignation of the billionaire president himself.

“These have been difficult days,” Pinera said at a ceremony in the presidential palace. “Our government has heard the loud and clear message of the Chilean people who want a more fair and more inclusive society.”

The president’s approval rating slumped to 14% last week as the protests all but paralyzed the country’s largest cities, according to a survey by pollster Cadem. Opposition lawmakers have announced a constitutional accusation against Pinera on the grounds of human rights violations.

Outgoing Cousin

Pinera appointed Gonzalo Blumel as interior minister and Ignacio Briones as finance minister.

Briones is dean of the school of government at Universidad Adolfo Ibanez. He has a PhD in political economy from Institut d´Etudes Politiques de Paris and was a senior adviser to the Finance Minister during Pinera’s first term in office.

“I have a very positive opinion of Briones as an academic and an expert in public policy, but he doesn’t have much experience in the political arena and this may eventually show,” said Tomas Izquierdo, an economist and chief executive officer of research firm Gemines Consultores.

Today’s firings also included Andres Chadwick, the interior minister and Economy Minister Juan Andres Fontaine.

Chadwick was a particular source of anger because of the violent suppression of the protests and the fact he is Pinera’s cousin. His replacement, Blumel, 41, was until now minister of the presidency, coordinating the passing of government bills with Congress.

Fontaine was another target of protesters after remarking that to avoid the higher subway prices, people should just get up earlier to take the subway at non-peak hours. A study earlier this year showed that Santiago residents face commutes as long as two hours.

Mounting Anger

The firings are unlikely to quell mounting anger over how Pinera has dealt with the protests. More than 1,000 people have been injured and over 3,000 arrested, according to the Chilean Human Rights Institute. Police and the armed forces between them are responsible for five deaths for which it is bringing homicide charges, the institute said on Oct. 22.

Protests resumed in front of the government’s Moneda palace after the announcement, according to images on TV.

“Chileans have been marching against Pinera’s agenda and the new interior minister is precisely the person that was in charge of pushing that agenda,” said Yasna Provoste, a senator for the opposition Christian Democrats party. “Pinera’s government just can’t get a grasp of the citizens’ demands.”

The extent of the protests shows the challenge facing Pinera’s center-right government. Pinera initially tackled the violence as a law-and-order matter, stating the country was at war with criminals. That only made things worse. He then apologized for failing to recognize genuine grievances and announced measures including raising taxes for high-income earners and lifting basic pensions.

While more than 600 supermarkets have been looted, the occurrence of serious violence has slowed. Losses for Chile’s retail sector due to looting and lost sales reached $1.4 billion since the protests began, according to the Santiago Chamber of Commerce.

Former Chilean President Michelle Bachelet, now the U.N. High Commissioner for Human Rights, said she would send a team to look into allegations of human-rights violations, a move the government welcomed.

To contact the reporter on this story: Eduardo Thomson in Santiago at ethomson1@bloomberg.net

To contact the editors responsible for this story: Daniel Cancel at dcancel@bloomberg.net, Philip Sanders

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