The military junta made its latest attempt to curb Chile's soaring inflation -- the highest in the world for the past few years -- with a call to businesses on Monday (5 November) to cut their prices.
GV PAN Business leaders seated in conference room.
SV General Pinochet leads other members of junta onto platform.
SV Business leaders seated.
SV General Pinochet speaking.
SV General Pinochet finishes speaking as delegates applaud PAN TO Minister Linez walking to microphone and speaking.
TRACKING SHOT members of military junta listening
Initials APSM/2108 APSM/2132
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Background: The military junta made its latest attempt to curb Chile's soaring inflation -- the highest in the world for the past few years -- with a call to businesses on Monday (5 November) to cut their prices.
The Minister of the Economy, Fernando Leniz, told an assembly of industrial and commercial leaders that their current prices were limiting trade to a strangling degree. He urged that they lower their prices to aid sales.
The Minister spoke with the full backing of the junta who looked on as he made his statement. The Military Government has strongly criticised the economic policies of President Allende, who they overthrew in a coup in September. And, they have pledged themselves to bring inflation down to a manageable level.
The current rate of inflation in Chile is running at almost one thousand per cent annually. While the junta has given wage increases, they have also raised prices sharply to try to stabilise the economy. It was in an attempt to voluntarily modify the price increases that Minister Leniz was speaking to the business leaders.
Minister Leniz pointed out that it was a mistake for businesses to peg their prices to the unofficial exchange rate of 400 Escudos to the U.S. dollar. He urged acceptance of the Government established rate of 285 Escudos to the dollar. He reminded the business leaders that acceptance of the higher valuation -- and thus costlier goods for citizens within the country -- showed a mistrust of the Government's stated valuation of the Escudo.
In order to allay some of the fears of businessmen that their products would not be competitive, he promised that the Government would regulate prices of internal and external markets.
New military junta has pledged itself to achieving an annual inflation rate of three per cent within three years.