Shopping Cart  |  Intelligence Center
CHILE TAKES STEP TOWARDS TERMINATION OF CONTROVERSIAL DEFENSE BUDGET MECHANISM
Tuesday, January 8, 2019
Click image for a larger picture

President Sebastien Pinera

Source: Government of Chile


President Sebastien Pinera

Source: Government of Chile


Close
SANTIAGO -- On January 7, a unanimous vote of approval by the Finance Commission of the Chilean Senate signaled a significant step towards the passage of a new law that would terminate a special defense budget mechanism that has formed a controversial cornerstone of the country's military spending procedures for roughly 60 years.

The funding mechanism known as the Restricted Law on Copper directed that 10% of the annual export profits generated by the Chilean state-owned copper company Coldelco be appropriated into spending accounts separate from the national budget framework and instead managed directly by the three branches of the Chilean Armed Forces. The law also imposes limitations on Codelco's participation in certain joint ventures or investment projects that might be deemed to contradict national security priorities.

Although the financial details and usage of these accounts had long been opaque, the liberalization of Chilean politics since the 1990s has seen the accounts become open to more legislative oversight. Reports indicate that the mechanism has generated from USD180 million a year up to USD1 billion for military spending ledgers depending on the contemporaneous fortunes of the copper industry.

The sitting administration of Chilean President Sebastian Piñera has been working to terminate the Restricted Law since 2011. After that initial effort, Piñera proposed a new version of the bill that would terminate the Restricted Law in August 2018 with the Finance Commission's approval moving the bill one step closer to a potential passage into law as soon as March 2018.

The administration's justification for the Restricted Law's termination includes the lack of democratic oversight and accountability associated with the fund's direct management by the armed forces rather than by the legislature, means to allow Codelco greater flexibility in its business practices and also serves as an attempt to create a more normalized and predictable defense spending framework that is not dependent on the attendant swings of copper exports.

Source:  Mining Journal
Associated URL: Click here to visit

 

MORE NEWS CATEGORIES
AEROSPACE & DEFENSE ELECTRONICS
AIRLINES, COMMERCIAL AVIATION & MAINTENANCE
AVIATION ENGINES, PROPULSION & AUXILIARY POWER UNITS
INDUSTRIAL & MARINE GAS TURBINES
INTERNATIONAL MILITARY MARKETS & BUDGETS - ASIA, AUSTRALIA & PAC RIM/EURASIA
INTERNATIONAL MILITARY MARKETS & BUDGETS - EUROPE
INTERNATIONAL MILITARY MARKETS & BUDGETS - NORTH AMERICA
MILITARY AIRCRAFT
MILITARY VEHICLES, ORDNANCE, MUNITIONS, AMMUNITION & SMALL ARMS
MISSILES & MISSILE SYSTEMS
NAVAL SHIPS AND OPERATING SYSTEMS
NON-US AEROSPACE/DEFENSE COMPANIES & CONTRACTS
REGIONAL, BUSINESS & GENERAL AVIATION
ROTORCRAFT
SPACECRAFT, LAUNCH VEHICLES & SATELLITES
US AEROSPACE/DEFENSE COMPANIES & CONTRACTS
Drones and Unmanned Systems - Air, Sea, Land, Micro & Robot Systems
UTILITIES, ROTATING MACHINERY & POWER GENERATION


NOTICE TO USERS

Warranty: Forecast International makes no guarantees as to the veracity or accuracy of the information provided. It warrants only that the information, which has been obtained from multiple sources, has been researched and screened to the best of the ability of our staff within the limited time constraints. Forecast International encourages all clients to use multiple sources of information and to conduct their own research on source data prior to making important decisions. All URLs listed were active as of the time the information was recorded. Some hyperlinks may have become inactive since the time of publication.

Technical Support: Phone (203)426-0800 e-mail support@forecast1.com

Subscription Information: Phone (203)426-0800 or (800)451-4975; FAX (203)426-0223 (USA) or e-mail sales@forecast1.com

Aerospace/Defense News Highlights is published by Forecast International, 22 Commerce Road, Newtown CT 06470 USA. Articles that list Forecast International as the source are Copyrighted © 2019. Reproduction in any form, or transmission by electronic or other means, is prohibited without prior approval from the publisher.

Forecast International invites all interested companies to submit their announcements and press releases for review and inclusion in our Intelligence Letters.

Contact: Ray Peterson, Director of Research
Email: Ray.Peterson@forecast1.com
Phone: 800-451-4975
Fax: 203-270-8919



HOME PRODUCTS & SERVICES MEDIA CENTER CONTACT US PRIVACY STATEMENT TERMS AND CONDITIONS

Forecast International © 2019 22 Commerce Rd Newtown, CT 06470 USA Phone: 203.426.0800 Toll-Free: 800.451.4975 (USA & Canada) Fax: 203.426.0223 info@forecast1.com