SANTIAGO, Chile – As part of the final stretch of her four-year term as president, Michelle Bachelet is expected on Jan. 11 to sign the country’s entry documents into the Organization for Economic Co-operation and Development (OECD).
OECD invited Chile last month to become the group’s second Latin American member, joining Mexico.
Bachelet, whose term ends on March 11, said Chile’s invitation to join the 30-nation bloc is a testament to the country’s progress.
"[It’s] a recognition of the progressive model of development that we have carried forward in these 20 years of freedom [since the end of the dictatorship of General Augusto Pinochet in 1990],” she said. “We have reduced poverty to historic lows and we have consolidated, at the same time, as one of the more competitive emerging economies.”
However, congress must ratify the country’s entry into OECD.
Andrés Velasco, the country’s finance minister, was even more enthusiastic, comparing Chile's entry into the organization with qualifying for the World Cup. The government considers its inclusion in the OECD improves the country's attractiveness in the eyes of international investors, Velasco said.
"Being part of the OECD is like…a guarantee of stability," Velasco said in an interview to Radio Agricultura of Santiago. “For Chile, it’s an advantage for future investments, [as] there are those who invest in OECD countries [only]. The conditions are better and the risk is lower.”
But not everybody is as excited as Velasco.
"Entry into the OECD is positive, but is rather more symbolic than meaningful in reality. It recognizes that Chile has stood out among the emerging economies,” said economist Joseph Ramos, a professor at the University of Chile. "[Chile had to adopt] some OECD standards deemed positive on banking insurance and protection to minority shareholders of corporations [to get in.]"
Ramos added Chile may adopt the "standards and best practices of developed countries that, in most cases, are positive, but in some cases, such as intellectual property, may be premature for [Chile’s] stage of development.”
He also noted that Chile's debt could be reduced, "but very marginally, perhaps 0.1%.”
“More or less, in my opinion, this is positive but less significant in the substantive level,” he said.
"Being part of the OECD is not an award, not a trophy, but an opportunity to keep improving," Senate President Jovino Novoa said. "Rather than boast about getting into the club, we must concentrate to equate the level of those countries to avoid embarrassment.”
During the negotiations for admission to the OECD, government officials stressed that as an OECD member, Chile can benefit in the development of innovation policies and human capital development, which are strengths of OECD-member countries.
But entry comes at a price. The local media reported it will cost the country about US$5 million annually to be an OECD member. But Raúl Saez, coordinator for international affairs of the finance minister, said the annual membership fee is about US$ 2.26 million, according to an article in the Chilean newspaper El Mercurio.
Velasco said that "the spending is not high. It’s not a club status, but is meritocratic. It is an achievement for the country of which we can all be proud,” according to his quote in the newspaper Diario Financiero.