August 14, 20 - 6:44 pm - Reuters

More than 1 million Chileans had received the government’s emergency support of $626

Chilean President Sebastian Piñera said on Friday that more than one million people had received the government’s $626 spot payment aimed at staving off the economic effects of the coronavirus pandemic and it had approved more than 550,000 requests for soft loans of up to $815.

Pinera said in total, three out of four Chileans – 14 million people – were at present beneficiaries of some form of social support.

His center-right government faced massive protests last year over social inequality and has in recent months announced emergency measures responding to the pandemic including spot payments, soft loans, mortgage payment holidays, and rent subsidies worth more than 11% of GDP.

Chile’s President Sebastian Pinera delivers a speech during the inauguration of the annual National Meeting of Entrepreneurs (ENADE) in Santiago, last January. Photo: Reuters/Edgard Garrido/File Photo

The lockdown associated with the virus outbreak has hammered Chile’s commerce, service and tourism sectors, driven unemployment to 11% and led the central bank to project an economic contraction of between 5.5 and 7.5% this year.

To date, Pinera said, more than a million middle-income Chileans who lost at least 30% of their income had received payouts of $626 while 2.4 million lower-income households had received a payment of $96.

He said 550,000 applications for the government’s soft loans scheme, paying $815, had been approved, and another $10bn had been approved in loans to small and medium businesses.

Last month, Chilean lawmakers passed a wildly popular bill allowing citizens to withdraw 10% of their savings from the country’s private pension funds. The bill had been staunchly opposed by the government which said it would harm the economy and future pensions payouts and people should lean on its own offerings instead.

To date, payments of $8.23 billion dollars have been made to more than six million people who requested the partial withdrawal of their funds, according to the Superintendency of Pensions.