Chile: Kast announces “difficult decisions” and rules out populist responses to oil crisis
Kast defined his administration as a government of Chile focused on what he called the culture of work done well and restoring each citizen’s basic duties.
Chilean President José Antonio Kast said he found the country “worse than he imagined” and warned his government will take unpopular adjustment measures, in an interview published on Saturday by the newspaper La Tercera, the first he has given since taking office on March 11.
We are going to make difficult decisions, with transparency, and we will not back down, Kast said from La Moneda Palace, where he has resumed the practice of residing — a custom abandoned since 1958. He said the fiscal situation inherited from Gabriel Boric’s government is worse than anticipated, with a cash balance that his Finance Minister, Jorge Quiroz, put at just $40 million at the end of December 2025. Former minister Nicolás Grau has publicly challenged that figure, arguing it does not reflect January 2026 revenues.
Kast identified the global oil crisis triggered by the war against Iran as an unforeseen factor compounding the fiscal outlook. When the price of oil doubles because of an unexpected event, of course you have to take adjustment measures, he said, alluding to potential changes to the fuel price stabilization mechanism (Mepco). A populist response would be to say we’ll keep things as they are. Clearly, that’s not possible, he added.
In his first week, the government has decreed an across-the-board 3% spending cut in all ministries, withdrawn the sector-wide collective bargaining bill — one of the previous government’s flagship labour reforms — and announced restrictions on free university tuition for students over 30. According to EFE, these measures form part of a fiscal adjustment estimated at roughly $4 billion.
Kast defined his administration as a government of Chile focused on what he called the culture of work done well and restoring each citizen’s basic duties. He rejected ideological labels and said his priority is full employment. They didn’t elect me for my academic credentials — they elected me to act, he said.
On pardons for military personnel convicted over events linked to the 2019 social unrest, Kast framed them as part of a quest for national reconciliation. At some point we have to move beyond the tensions, he said, acknowledging the measure will not convince everyone.
On security, the president defended the construction of trenches along the northern border and the launch of the Border Shield Plan as part of a broader strategy against organized crime and irregular migration. I’m fully aware that the trench won’t stop organized crime, but combined with street-level enforcement and oversight, it will shrink the space, he explained.
Responding to the opposition, which has described his early measures as refoundational, Kast called for responsibility and urgency. Chile is at a critical moment. I understand the role of the opposition, but I ask them to understand their duty to Chile, he said.
