The day after the first round of the Chilean presidential and parliamentary elections, the picture looks clearer – and, frankly, rather encouraging.
Yesterday’s vote confirmed what markets had been discounting for months: Chile is swinging back toward a pro-market, law-and-order agenda. Jeannette Jara came first with just under 27%, José Antonio Kast followed with almost 24%, and the remaining right-of-centre contenders together pushed the conservative share of the vote well above that of the left. At the same time, Kast’s Republican Party and its allies scored major gains in both chambers of Congress, emerging as the largest bloc, though still short of the quorums needed to change constitutional-rank laws on their own.
For international investors, the message is twofold. First, there is no anti-market rupture in sight: Chile will remain a country of strong institutions, an independent central bank and respect for contracts. Second, the next administration is very likely to be led by a candidate whose program explicitly seeks to reactivate growth by cutting red tape, reprioritizing public spending and expanding the space for private investment – particularly via concessions and public-private partnerships.
Kast has framed his proposal as an “emergency government” to restore public order, reboot the economy and modernize the state. His platform is built on a subsidiary-state vision: the public sector sets the rules and guarantees basic services, but it is the private sector that invests, builds and operates. That implies a fiscal adjustment of roughly USD 6 billion in 18 months through the elimination of inefficient programs and the merger of overlapping public services, combined with a pro-investment tax reform that reduces the corporate tax burden and simplifies the system rather than inventing new levies.
The most relevant chapter for foreign investors, however, is not tax but execution capacity. Kast’s team has placed enormous emphasis on the bottleneck that permits, sectoral authorizations and bureaucratic inertia represent for investment. The proposal of a fully digital “one-stop-shop window” with strict maximum deadlines and penalties for unjustified delays will be a quantum change in the execution of projects. If that reform is even halfway well-implemented, it could shave months – in some sectors years – off project lead times.
Equally important is the proposed expansion of the concession model. Kast is not only talking about more roads and airports. His program explicitly mentions opening hospitals, prisons, water infrastructure and even segments of social housing to private investment under transparent bidding processes, overseen by a technically autonomous national concessions agency. That formula is familiar to many international players: stable long-term contracts, tariff mechanisms anchored in law and the possibility of international arbitration. For funds specialized in infrastructure, real assets and long-duration yield, Chile could quickly regain its former privileged place in their LatAm allocation.
On top of that comes a clear intention to privatize or partially privatize non-strategic state-owned companies and to deepen PPP schemes in transport and logistics. For strategic investors already present in the country, this points to a pipeline of brownfield and greenfield opportunities in sectors where the state has historically been a dominant operator. For newcomers, it suggests entry points with clear legal frameworks rather than improvisation.
The market had already started to price in a right-wing victory well before yesterday. A recent note by Scotiabank Economics highlighted that Chilean assets were trading at a discount that assumed political noise but not necessarily a fully aligned executive–legislative axis; a conservative win in both spheres could therefore unlock appreciation of the peso and a re-rating of domestic equities, especially in regulation-sensitive sectors. Yesterday’s congressional results, which confirm a strong presence of the right, point exactly in that direction.
None of this means that a Kast administration would have a blank cheque. He will still need to build legislative coalitions – including, in all likelihood, the support or abstention of Franco Parisi’s “Partido de la Gente” and parts of the traditional centre-right – to pass reforms. In other words: Chile may be moving to the right, but it is not abandoning its culture of gradualism and negotiation.
From an investor’s perspective, that combination is quite attractive. A government with a clear pro-business bias and a Congress inclined to deregulate and open up new sectors to private initiative, constrained by robust institutions and high quorums, offers a scenario where business-friendly reforms are very likely, but sudden, arbitrary policy swings are highly improbable. Compared with the regional landscape, that is not a trivial advantage.
What does all this mean in practical terms for foreign investors?
In the short term, assuming Kast consolidates his lead in the polls and wins the 14 December runoff (Polymarket gives him a 95% possibility to win at this date), we are likely to see a relief rally in Chilean risk assets and a tangible improvement in business sentiment. Transactions that had been on hold pending political clarity should revive, and it would not be surprising to see renewed interest in Chilean infrastructure, energy and service companies as acquisition targets or partners. The main risk in this phase is execution noise: the composition of the cabinet, the pace at which the new administration can move its first bills, and the inevitable tug-of-war within the right over priorities. But the direction of travel – towards more growth and more private participation – looks clear.
In the medium term, the key question is how much Kast’s state-modernization and concessions agenda becomes law and practice. If the government succeeds in streamlining permits, expanding PPPs into new sectors, adjusting the tax system at the margin in favor of investment and advancing digitalization of public services, Chile can regain its position as the region’s benchmark in regulatory predictability and infrastructure quality. For foreign investors, that would translate into a deeper pipeline of bankable projects, shorter development cycles and more room to structure sophisticated financing and M&A operations around assets that the state is willing to concession or privatize.
In the long term, the opportunity is to anchor Chile once again as a stable, outward-looking hub for investment in the Southern Cone. A pro-business administration backed by a Congress that shares its basic economic diagnosis can, over a period of years, rebuild confidence after a decade marked by a misguided public policy, a failed revolutionary attempt, social unrest and constitutional uncertainty. If that is achieved without sacrificing the institutional checks that characterize the Chilean system, the country will continue to stand out in Latin America for one simple reason: it offers investors a combination that is scarce in the region – clear rules, deep respect for contracts and a political class that, despite its ideological battles, understands that long-term prosperity depends on private initiative and foreign capital.
For investors with a strategic horizon, this is not a time to stand on the sidelines. It is a moment to update country-risk assumptions, revisit shelved projects and be ready to move as soon as the new rules of the game – more friendly than the old ones – start to take shape.
I Chirgwin I
Andrés Chirgwin
