(Adds quotes from Boric)
SANTIAGO, Jan 21 (Reuters) - Chile's leftist President-elect
Gabriel Boric unveiled his Cabinet on Friday, throwing markets
and investors a bone by picking current central bank head Mario
Marcel to be the Andean country's finance minister.
Boric also named Izkia Siches, a prominent doctor and part
of his campaign team, as the interior minister and his deputy,
as well as lawmaker Marcela Hernando for the key role of mining
minister, where copper and lithium development will be in focus.
The balanced make-up of the incoming government suggests
Boric, a 35-year-old lawmaker and former student protest leader,
may look to push gradual reforms rather than abrupt changes
some had feared in the world's top copper producing nation.
"Naming Mario Marcel as finance minister is a very good sign
of economic stability, seen positively by markets," said Miguel
Angel Lopez, a public affairs professor at the University of
Chile, adding it was a mix of coalition allies and technocrats.
"It's all linked to a much more centrist, more pragmatic
shift in terms of what Boric wants to do in his government."
The new government, which will take office on March 11, was
made up of members of parties across the political spectrum,
reflecting a fragmented and diverse Congress. Women will lead
more than half of the ministries.
Boric pledged during the election campaign to enact major
reforms to Chile's market-led economic model, rattling
investors, though he has moderated his tone since, boosting
Chile's markets and currency.
The peso currency strengthened early on Friday to
under 800 per dollar for the first time since November. A select
index of Chilean equities also rose more than 2%.
Boric during the campaign pledged to "bury" Chile's
market-orientated model, which has driven growth in the South
American country in recent decades but has also deepened
inequality, triggering months of social protests at the end of
He has promised to reform the private pension and health
systems and raise taxes to finance greater social spending.
"This Cabinet's mission is to lay the foundations for the
great reforms that we have proposed in our program," Boric said
after unveiling his ministers, adding that it would look to
drive economic growth while cutting out "structural
"We are talking about sustainable growth accompanied by a
fair redistribution of wealth," he said.
Chile, a global front-runner in the roll-out of COVID-19
vaccines, ended last year as the world's best-performing
economy, buoyed by large state spending and several rounds of
private pensions withdrawals to ease the impact of the pandemic.
Boric will, however, have to contend with signs of an
overheating economy and inflation, as well as a fragmented
Congress, which analysts say will force him to seek consensus
with more centrist sectors.
"One of Boric's biggest challenges will be cooling down the
economy and retaining popular support," Oxford Economics said in
a report, adding that the young leader would face pressure to
increase social spending while meeting tighter budget targets.
(Reporting by Fabián Andrés Cambero and Natalia Ramos; Editing
by Sandra Maler, Chizu Nomiyama and Paul Simao)