Chile Faces Recession Risks Amid Fuel‑Price Shock and Government Cuts

Chile is on the verge of a technical recession, with the Imacec activity index falling 0.9% and five consecutive months of economic contraction. Former finance minister Mario Marcel blamed the sharp rise in fuel prices and related policy decisions by President Gabriel Kast and Finance Minister Mario Quiroz for a “shock” that lowered consumer confidence and slowed retail and services.

Critics also highlight the government's broader fiscal plan, noting cuts to the health ministry budget and increased public debt, which they say disproportionately affect vulnerable populations and threaten the quality of public health services.