COVID-19 Reports on Latin America and the Caribbean: No. 20 (En Español)
Emergency Economic Plan
The emergency economic plan was created to mitigate the pandemic’s impact on commerce and the national economy. This plan contemplates 3 lines of action: protection of jobs, support to businesses, particularly small and medium-sized enterprises and support for family income. A few of the most important points include the following:
- Employment protection law
- Income protection for independent workers
- Anticipated refunds from taxes for all workers, including independents
It is noteworthy to mention that 70% of the labor force saw their income reduced during the first three months of the pandemic. Only during the month of September, employment rates began to rise once again.
Withdrawal of 10% of Provisional Savings
Given that some of these initial measures were considered insufficient, both citizens and elected officials agreed upon the need to make use of pension funds in order to mitigate the economic impact among Chilean families. In August, law no. 21.248 was approved to allow citizens to withdraw just once 10% of their pension funds from their respective pension management plans. 95% of contributors did manage to withdraw their respective legal maximum amounts, which represented approx. 4 million Chilean pesos withdrawn. At the publication of this report, the government is currently discussing the possibility of a second withdrawal. A lot of questions still remain unanswered before taking this step, and especially which conditions will be enacted to make this happen.
Measures on Social Protection
The social protection network is an initiative led by the Ministry of Social Development and Family, which gathers the intersectorial work of different ministries in favor of protecting and strengthening the middle class. This initiative channels a series of benefits and procedures that can be pursued rapidly and which are focused on helping individuals, small and medium-sized businesses and families battling the ripple effects of this pandemic. The Coronavirus Plan of Action includes specific benefits and support, for example the COVID bonus, emergency family income, state loans, employment subsidy, benefits for older people as well as children, monitoring and eliminating violence against women, etc.
Reopening Plan
Since July, the Chilean government has implemented a national plan called Step by Step. It involves a gradual strategy to face the pandemic based on the health situation in each zone given the diversity of the Chilean territory. This plan envisions 5 scenarios or gradual steps which are the following:
Each of these phases or steps contains a series of restrictions and specific obligations. Moving backwards or forwards in these steps is subject to epidemiology, healthcare and tracing indicators.
Monitoring the Legal Response to COVID-19 in Latin America and the Caribbean 