After years of conspicuous success, the Chilean economic system, based on the monetarist policies pioneered by U.S. economist Milton Friedman, now appears to be foundering.
GV EXTERIOR Santiago street scene
SV Plaza De Armas with police walking past
SV Woman in street begging, man lying asleep (2 shots)
SV TILT DOWN AND GV Unfinished apartment blocks in Vina Del Mar (4 shots)
GV Ship alongside in port of Valparaiso
GV Containers being loaded onto back of trucks on wharf (3 shots)
GV PAN Ships alongside at wharf
GV Currency exchange board in window (2 shots)
CU AND SV Teller counting money in bank with customer (2 shots)
GV Street scene with people walking down roadway
GV Street market stalls with customers (3 shots)
GV INTERIOR Woman with trolley in supermarket (2 shots)
GV EXTERIOR People in street and reading newspapers on park bench (3 shots)
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Background: After years of conspicuous success, the Chilean economic system, based on the monetarist policies pioneered by U.S. economist Milton Friedman, now appears to be foundering. Massive unemployment means that one in four Chileans is out of work. Other signs of a deepening recession can be seen in Chile's cities--in Santiago, beggar are becoming an increasingly common sight on the streets. In Vina del Mar, huge apartment blocks stand unfinished because of a lack of development funds--even if they were completed indications are there would be few buyers. The port of Valparaiso is a busy one--a consumer boom has driven up imports and a fall in the price of copper, Chile's prime export, has cut national income. As a result, Chile is suffering a balance of payments crisis as well as the effects of a recession. The supply of foreign credit to the private sector of the economy has dried up, sending hundreds of companies into bankruptcy. President Augosto Pinochet has not escaped unscathed and has been forced to reshape his Cabinet. Out went the more inflexible of the free-marketeers and in came Senor Rolf Luders, the new Minister of Economy and Finance, in a bid to breath fresh vigour into faltering economy.