Chile slams World Bank for bias in competitiveness rankings

SANTIAGO: Chilean officials on Saturday criticized the World Bank, saying it treated the South American country unfairly in its closely watched annual ‘Doing Business’ competitiveness rankings.

“What happened with the World Bank’s competitiveness rankings is very concerning,” socialist President Michelle Bachelet, whose four-year term ends in March, wrote on Twitter after the World Bank’s chief economist apologized for Chile’s slippage in the rankings under her tenure.

“Rankings that international institutions conduct should be trustworthy, since they impact investment and countries’ development,” Bachelet wrote, adding that the government would formally request a complete investigation from the World Bank.

In an interview with The Wall Street Journal published on Friday, World Bank Chief Economist Paul Romer apologised to Chile for changes to the report’s methodology that he said “conveyed the wrong impression” about the business environment under Bachelet.

Chile currently ranks 55th out of 190 countries on the list, down from 34th in 2014, the year Bachelet took office. Its ranking declined to 41st in 2015, 48th in 2016, and 57th in 2017, the World Bank’s reports show.

Romer told the newspaper the decline resulted from methodological changes, rather than a deterioration of Chile’s business environment, and may have been the result of the World Bank staff ’s political motivations. He told the newspaper he would revise the reports.

Chile is one of Latin America’s wealthiest and most stable countries. While Bachelet introduced progressive tax and labour reforms that the country’s business community said crimped investment, she has not fundamentally altered the country’s longstanding freemarket model.

Economic growth decelerated under her watch in large part due to low prices for copper, the country’s main export.

In presidential elections last month, conservative billionaire and former President Sebastian Pinera trounced Bachelet’s preferred candidate, Alejandro Guillier, in part on promises to slash red tape and boost investment. — Reuters