The Parliament of Chile approved this Wednesday a bill introduced by the Government to raise the minimum wage by 14.3% in 2022the largest readjustment in 25 years.
The Chamber of Deputies of Chile unanimously approved the legislative initiative to raise the minimum salary from the current 350,000 pesos (about 411 dollars) to 400,000 pesos in August (470 dollars), after the Senate did the same in the eve.
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“Historic news for Chile! Today we move forward together with the workers with concrete measures, the biggest increase in the minimum wage in 25 years,” Chilean President Gabriel Boric said on Twitter.
“This measure is a floor of dignity that we achieve together with workers, companies, SMEs and parliamentarians. We continue!” Added the progressive president about one of his star proposals.
The rise was the product of a historic agreement between the Executive and the Unitary Central of Workers (CUT), the largest trade union center in the South American country, and places Chile at the forefront of Latin America, although it would still be far behind the main OECD member countries in terms of minimum wage.
The initiative proposes an increase in two tranches: up to 380,000 Chilean pesos on August 1 (about 440 dollars) and up to 400,000 Chilean pesos thereafter.
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Historic news for Chile! Today we move forward together with the workers with concrete measures and the greatest rise in #Minimum wage in 25 years. Great agreement between workers, companies, SMEs and parliamentarians. We continue! https://t.co/blERd0C0hU
— Gabriel Boric Font (@gabrielboric) May 18, 2022
The Minister of Finance, Mario Marcel, explained that the project will benefit one million workers and that also includes a subsidy for SMEs to cover the rise in the minimum wage that is above inflation and help for the most vulnerable to face the rise in the price of the basic food basket.
“This encourages us to continue along this path of dialogue that has been manifested so clearly,” added Marcel in statements to the media.
If the accumulated inflation in 12 months to December 2022 exceeds 7%, the project also determines that the minimum income will rise to 410,000 pesos per month (475 dollars) from January of next year.
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Very happy and grateful for the substantive increase in the minimum wage and the unprecedented subsidy to MIPYMES to support such increase. It is the 1st government project in which I participate in its processing. Result of an agreement with MSMEs and with the CUT, and was perfected by both chambers https://t.co/S6M6uUNUzv
– Nicolás Grau Veloso (@nico_grau) May 18, 2022
After a historic rebound in GDP of 11.7% in 2021, the largest expansion in four decades, the Chilean economy is showing signs of cooling and registers an inflation unprecedented since the 1990s.
Inflation registered an interannual increase of 9.4% in twelve months in March, a situation that has led the Central Bank to raise the reference interest rates as a containment measure from 2.75% to 7% in less than half a year, something unprecedented in more than 20 years.
EFE
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