Chile’s new billionaire leader has just gotten substantially wealthier after the value of shares soared in the wake of his election victory. Sebastian Pinera won the country’s run-off election last weekend and since then his 25 percent shareholding in Chile’s LAN Airlines SA have increased in value by two fifths giving the company a value of over $1.5 billion. Stock market officials halted trade and triggered an automatic investigation which happens whenever share prices increases by more than 20 per cent in one day's trading. Pinera refused calls to sell the shares before the election.
Outgoing president Michelle Bachelet, who was constitutionally barred from seeking re-election, had raised conflict-of-interest questions over Pinera's LAN stake during the presidential campaign. He did however promise he would divest the shares after the election and he reaffirmed that promise last week. He has also set up a blind trust to manage $500m of his fortune including ownership of the country's four television networks and Chile’s biggest football club Colo-Colo.
The obvious comparison for Pinera is with Italian leader Silvio Berlusconi. Both are right-wing wealthy businessmen who won their countries' elections with the help of their media empires and soccer teams. However Andres Oppenheimer says the comparisons are facile and notes five significant differences. Pinera has a PhD and taught economics at Harvard, he has been a senator for 20 years, his business record is free from scandal, he is a family man married for 36 years and he may be less of a right-winger than many think. Oppenheimer said Pinera opposed Pinochet in the 1980s (though others dispute this) and is liberal on social issues.
But there is no doubting his huge war chest helped him win the election. By last week’s runoff election with former president Eduardo Frei, Pinera had spent at least $13.6 million on the campaign. His victory marked a political shift as candidates of the governing Concertacion coalition had won all four presidential elections since 1989 on pledges of eradicating all traces of Pinochet’s leadership. Although 73 percent of Chileans still despise the former dictator, Pinera won because the coalition was split between two presidential candidates.
In the first vote on 13 December, Pinera took 44 percent of the vote with Frei second on 29 percent. Frei might have expected to pick up the remaining left-wing vote in the second ballot. After all, Concertacion had succeeded in reducing Chile’s poverty rate from over 40 percent to approximately 15 percent, while boasting the region’s most impressive growth rate since 1990. Former president Bachelet left office with an approval rate of over 80 percent. Yet Frei could not galvanise that support and his campaign slogan of “a vote for Pinera is a vote for Pinochet” fell flat. Frei did succeed in closing the gap as the run-off date came closer. But when Chile’s voters went to the polls on 17 January just enough of them decided they wanted to see change. Pinera won by 52 percent to 48.
There is at least one leftwing leader in the region who is unperturbed by Pinera’s win. Bolivian president Evo Morales, who himself was recently re-elected president (after changing the country’s constitution to allow him to stand), saluted the new Chilean leader and said he hopes he can continue the improvement in Bolivian-Chilean relations. Morales said he hoped Pinera will continue the bi-national dialogue started by “compañera” Michelle Bachelet. Relations between the two nations has been historically frosty since Chile won the War of the Pacific against Peru and Bolivia in the late 1800s, taking control of nitrate and mineral-rich lands and forcing Bolivia to lose its access to the Pacific Ocean. Bachelet was the first Chilean leader willing to discuss the issue with Bolivia and Morales hopes Pinera will continue the dialogue.