In Chile, the government has had great success since 2000 with its structural surplus rule. This policy has proven to be an effective stabilizer throughout the business cycle and has helped the country maintain an enviable debt position. A fiscal policy that delivers public debt sustainability is particularly useful in today's economic climate, because it gives governments the flexibility to respond to evolving circumstances.
For Canada, this will become increasingly important given that we will be facing demographic pressures in the years ahead as our population ages. In terms of monetary policy, both the Bank of Canada and the Banco Central de Chile were pioneers in adopting a policy of inflation targeting backed by a floating exchange rate.