The Inter-American Development Bank (IDB) approved a $250 million loan to back Chile’s reforms aimed at boosting competitiveness and sustainable growth, according to a press release. The policy-based loan will help accelerate digital transformation of public services, push the country toward circular production models, and increase formal employment by supporting small businesses and workers. Chile’s government plans to use the money to expand digital infrastructure and strengthen the institutional framework for state digital transformation.
Chile has been working to modernize its economy and make growth more inclusive across different sectors. The country wants to reduce transaction costs for the government and citizens while making public services more accessible. Previous reforms have laid groundwork for these changes, building on a $100 million policy operation the IDB approved in 2021 to boost competitiveness.
The program includes measures to expand digital infrastructure through the National Data Centers Plan and develop accessibility guidelines for people with disabilities. For sustainability, Chile will work to increase recycling of industrial and construction waste and introduce policies to make mining more circular. The country also plans to create a new wage subsidy system and implement a national strategy to improve job matching and training.
Small businesses are expected to see higher productivity and more formal employment opportunities, while companies and working-age people will benefit from better job matching systems. The reforms target women, young people, and people with disabilities who face bigger gaps in accessing formal employment. Chile hopes these changes will reduce informal work and increase overall productivity.
The $250 million loan comes with a 20-year repayment term, 5.5-year grace period, and interest rate based on SOFR. The program builds on earlier progress and aims to benefit Chile’s economy and society by making digital services more accessible and creating better job opportunities for everyone.
