The first South American country to join the OECD, Chile is one to the fastest growing Latin American economies. But despite making considerable progress in reducing poverty, inequality is still a massive challenge needing to be faced.
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Chile's macroeconomic policies and
strong fundamentals have, to a large extent, insulated it
from regional crises, and have allowed continued growth in
recent years... Show More +, albeit at lower rates than in the mid-1990s.
Economic performance continues to outpace that of the rest
of the Region, and in per capita terms, GDP growth has
averaged 4 percent per year since 1990, versus one percent
for the Latin America and the Caribbean (LAC) region during
the same period. This performance is sustained by sound
policies and an ambitious structural reform agenda. The
abundant trust in government in Chile today, can be
attributed, in part, to two elements of transparency: its
fiscal reporting, and the incontestable review by a
competent, independent authority - the CGR (Controller
General of the Republic). Furthermore, Chile has effectively
centralized policies and procedures to support aggregate
fiscal discipline, yet, its public financial management is
characterized by a unique blend of strengths and weakness.
Chile is well into the second generation of public sector
reforms. Notwithstanding the favorable status of financial
management, to advance with modernization in terms of fiscal
transparency, several issues have to be addressed. For Chile
to emerge at the forefront of public sector management, it
should issue its annual financial statements with an audit
opinion, adherent with international accounting standards.
But to render opinions, the CGR would have to distance
itself from both the ex ante approval role of budget uses,
and the preparation of the annual financial statements.
Thus, the authorities should consider a solution that
complies with international practices, and accommodates with
country constraints. Show Less -