Treasury Minister on January’s economic activity index (Imacec): “This confirms that the economy is regaining momentum”
“That we are beginning to see an upward trend and are effectively entering an up-swing is very important,” said the Treasury Minister, Alberto Arenas, in response to January’s 2.7% economic activity index (Imacec) which was published this morning by the Chilean Central Bank.
The minister explained that the index for the first month of the year “corroborates, in our opinion, the encouraging news about our economic performance, which we reported at the end of last week in relation to some sectorial activity indices. This confirms that the Chilean economy is regaining momentum.”
The minister highlighted that January’s index “is clearly higher than the market had expected”. He also noted that “for the second consecutive month we can say that economic activity has surprised to the upside.” In this respect he recalled that economists had estimated that the figures for December 2014 would be around half of the 2.9% finally published by the Central Bank, while for January, they had predicted a figure of around 2% just a few weeks ago.
Minister Arenas explained that “in the short term– and January’s figures confirm this – we are expecting to see economic recovery and higher growth during the first quarter of 2015 than we had in the fourth quarter of 2014.”
He recalled that in the second quarter of 2014 the Chilean economy grew 1.9%, hitting a low of 0.8% between July and September and rising again in the final quarter to 1.9%. He said that “January’s index of 2.7% confirms what we had forecast, that we are on an upward curve, with a growing economy that has begun to show signs of moderate recovery over the last five months.”
Public-private alliance
Alberto Arenas went on to explain that “we must continue working on the public-private strategic alliance and on nurturing confidence.” He reiterated that “we are convinced that economic growth will be higher in 2015 than in 2014 and January’s figures confirm what has been happening in the last five months in the economy; it hit a low in the third quarter of 2014 and since then there has been a moderate recovery. The figures show this and January confirms that the Chilean economy is experiencing an upswing.”
The Treasury Minister also explained that “economic growth in Chile is a responsibility shared between the public and private sectors, and we are working jointly toward our goal of achieving higher economic growth in 2015 than in 2014. As we have said before, we currently have a series of economic motors: an expansive monetary policy, a countercyclical fiscal policy, our exchange rate is high, which is driving the export sector; our economy has solid bases to continue in this ascendant phase.”
Asked about the impact of public spending on economic activity, Arenas highlighted that public investment is up 27% and said that this “will generate a boost. In this regard we have a countercyclical budget which is giving the economy a boost.”
“January’s budget implementation closed at around 6.9% higher than in January 2014. The most important part of this budget implementation was public investment, which was essentially 1% higher than in January 2014. We will continue in this direction, working efficiently, overseeing public resources and implementing the public investments well,” he explained.