Billionaire Pinera Takes Power As Quakes Jolt Chile

A series of strong aftershocks rattled central Chile minutes before conservative Pinera was sworn in at Congress in the port city of Valparaiso, as Latin American presidents and other dignitaries looked nervously at the ceiling.

Workers in the capital briefly evacuated swaying office towers and took refuge in the streets.

Thursday’s aftershocks were an unsettling reminder of the earthquake that killed nearly 500 people and damaged infrastructure across much of south-central Chile, threatening Pinera’s election pledges to boost economic growth to 6 percent a year and to create a million jobs.

In Constitucion, heavily damaged in the 8.8-magnitude quake on Feb 27, residents scrambled for the hills on Thursday after the navy issued a tsunami alert, but it was later called off.

Pinera rushed off to the quake zone after swearing in, leaving behind the presidents who attended his inauguration.

“I felt that my duty was to be here in Constitucion,” he said, dressed in a red zip-up-jacket, in the coastal city known for its fishing and forestry industry.

The new president has ordered his interior minister to personally oversee the recovery work of state emergency office Onemi, heavily criticized for its handling of the earthquake and ensuing tsunamis that devastated coastal villages.

Chileans hope that Pinera, a Harvard-trained economist, can use his business acumen to help one of Latin America’s most stable economies rebound from the devastating earthquake.

“The main challenge is to identify priorities to swiftly start the reconstruction effort. That will be the key variable that will be evaluated during his administration,” said Alberto Ramos, senior economist with Goldman Sachs in New York.

“This could be the Katrina of President Pinera … in terms of how the population perceives the relief and reconstruction effort,” he said, referring to the powerful hurricane that struck New Orleans in 2005. The slow relief effort damaged U.S. President George W. Bush’s popularity.

While mines were mostly unscathed in the world’s top copper producer, the February quake seriously damaged Chile’s key wine, fish and paper pulp industries.

Some analysts see the damage shaving 0.5 to 2.0 percentage points off this year’s economic growth, while others are holding to their original GDP forecasts of around 5 percent.

State-owned copper company Codelco, the world’s biggest copper miner, said none of its mines were damaged in Thursday’s aftershocks. One, a powerful magnitude 6.9 about 124 km (80 miles) south-west of the capital, was nearly as powerful as the quake that devastated Haiti in January.

Pinera, a 60-year-old former senator who made a fortune on a credit cards business and an airline, ranks No. 437 on Forbes’ richest list, which estimates his fortune at $2.2 billion (1.5 billion pound).

To fund reconstruction, the new leader is likely to issue international bonds and dip into the country’s copper savings.

Survivors are praying that he gets it right.

“He is a businessman … and that is what we need right now. Someone who can create jobs for our kids,” said Carlos Fuentes, a 47-year-old fisherman who lost his home and boat when giant waves rolled over the town of Curanipe after the quake twelve days ago.

Pinera has announced a program to provide 4 million of the neediest families with 40,000 Chilean pesos (51 pound) this month.


The continued rumbling has frayed nerves, particularly in hard hit Constitucion and Rancagua, shaken hard by Thursday’s aftershocks.

After initial reports of significant damage on Thursday, emergency officials later said there were no reports of damages, injuries or fatalities.

“Now I’m nervous!” said Delfina Fuentes, 60, on a nearby hilltop on Thursday after abandoning her home in Constitucion, which was damaged by the February quake.

The handover of power from popular centre-leftist Michelle Bachelet was celebrated with an austere midday ceremony, toned down out of respect for the dead.

Pinera joins a small group of conservative leaders in Latin America, where most presidents are leftists or centre-leftists. He is the first conservative leader in Chile after two decades of centre-left rule that has consolidated the country’s status as the most developed country in Latin America.

Bachelet, a paediatrician-turned-politician, left office with a record 84 percent approval rating even after criticism of delays in government aid for victims.

Her government was also slammed for a faulty tsunami warning system, botched death toll estimates and hesitating to send in troops to quell violent looting. Reuters