Chile vows 'new social contract' after 11 killed in march against inequality

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Santiago - Chilean President Sebastian Pinera said on Monday evening he would meet opposition leaders to forge a "new social contract" to alleviate inequality as thousands of Chileans defied a military curfew in protest marches around the capital. Pinera struck a conciliatory tone in a national address from the Moneda Palace in Santiago after declaring on Sunday from the city's military barracks that the country was "at war" against vandals, a statement that sparked outrage in some quarters. "If sometimes I have spoken harshly... it's because it makes me indignant to see the damage and pain that this violence causes," the 69-year-old conservative billionaire said. Thousands of Chileans poured into Santiago's central squares on Monday to protest high living costs after a weekend of looting, arson and clashes with security forces killed 11 people. The crisis was sparked by protests over an increase in public transport fares but reflects simmering anger over intense economic inequality in Chile, as well as costly health, education and pension systems seen by many as inadequate.

Throughout Monday demonstrators spread along main thoroughfares and bridges around the city, remaining on the streets until past 8 p.m., when an official military curfew came into force, before soldiers gradually dispersed them using water cannons, tear gas and verbal persuasion.

Although he had described protesters as "delinquents" in previous statements, Pinera this time referred to "small groups" of vandals that had ransacked market stalls, supermarkets and small businesses, requiring a reconstruction plan that would cost "hundreds of millions of dollars". "We want to repair not only the physical damage but also the moral damage that these acts of violence have caused in the body and soul of our country," he said.

He vowed to find ways to reduce the costs of basic services like electricity and highway tolls, improve the country´s pension offerings and reduce the price of medication and medical waiting lists.

"I am very conscious that this is a first step and we have a long way to go," he said.

'COMPLETELY INEPT'

Buses and metro networks were partially restored on Monday for people to return to work but many opted instead to join the biggest demonstrations in years in what is normally one of Latin America's most stable countries.

Banging drums and pans, blowing whistles and waving signs calling for Pinera's ouster, the largely youthful and peaceful crowd filled Santiago's Plaza Italia and overflowed into surrounding streets, watched from the sidelines by soldiers and police, with helicopters hovering overhead.

"Pinera, listen! Go to hell!" the crowds chanted.

Jose Jimenez, 33, a filmmaker who had joined the protest, told Reuters it was hard to predict what would come next.

"Something has broken," he said. "The government has shown itself to be completely inept and until there's a way to respond to or contain this situation, I think it's only going to keep growing."

'DISTURBING ALLEGATIONS'

Both the peso and the country's IPSA blue-chip stock exchange lost ground on Monday after the clashes.

Officials late Sunday said the country's copper mining industry, the world's largest, was operating normally, though the union of BHP's Escondida copper mine workers announced a daylong strike on Tuesday in solidarity with the protests.

Finance minister Felipe Larrain said the civil unrest would "undoubtedly" have a "significant" impact on the economy.

Dr. Jaime Manalich, the health minister, said 239 civilians had been injured in three days of unrest, while the death toll was raised to 11. Interior Minister Andres Chadwick said one man had died of gunshot injuries in the northern province of Coquimbo.

Chile's Institute of Human Rights said it had made contact with 1,333 people detained in the protests, including 181 children and adolescents, along with 88 people who had been shot, five of whom were in serious condition and one in critical.

U.N. human rights boss Michelle Bachelet, a former president of Chile, called on Monday for independent investigations into the deaths in weekend protests, citing "disturbing allegations" of excessive use of force by security forces.

Reuters