Truckers Shut Down Chile

Friday morning truck owners ended their four day indefinite strike after reaching an agreement with the Government following all night negotiations. Truck owners demanded the Government do something with the high price of diesel needed to power their rigs. The Government agreed to subsidize up to 80% of the diesel tax collected each time a truck fills up at the pump.



The strike was called for Tuesday dawn, but some truckers jumped the gun Monday partially shutting down the main highway that links Santiago with major ports in central Chile.

Truckers are not the only group feeling the pinch of high oil prices, the rising cost of fuel is causing damage to the economy overall. The country is showing slower economic growth and higher inflation.

Also the cost of electricity has increased dramatically due to the dwindling supplies of natural gas from Argentina used to generate electricity in combine cycle plants. So the generating plants use diesel to power up their electrical generating stations.

In response to the high price of fuels, President Michelle Bachelet announced Monday a series of measures aimed at reducing fuel prices at the pump and energy generation. She announced her Government is investing one billion dollars to the oil stabilization fund, this significant deposit means that when it begins operating will allow for gas, diesel and kerosene prices to be lowered at the gas pump some 50 pesos per litre (10 US cents).

But the truck owners association called the measures a band-aid solution. Truckers who pay on average $1.35 US for one litre of diesel, say the measure is not enough.

Juan Araya, the President of the truckers' association, told the press that the stabilization fund makes him think the government is not listening. He says the billion dollars is important to all Chileans because it will have an impact. "But in our case is a partial solution."

Despite the billion dollar announcement the strike was on. Truckers partially shut down highways all over Chile, and prevented delivery of gasoline to gas stations and of food staples to supermarkets. In some smaller centres, gasoline run out and in supermarket shelves food products began to scarce.

With the spectre of shortages the Government Thursday, called truckers to the sit down to negotiate. The Government caved in to truckers' demands. Truck operators now can write down 80% of the diesel tax they pay at the pump for one year. They had demanded a 100% write off of the diesel tax, but agreed to 80% after the Government moved up from a 50% write down.

Now a truckers' strike in Chile brings back bad memories, because a massive two-month long truckers strike in 1972 and a year later another major strike in part paved the way for the 1973 military coup.