Rising Crime Drains $8 Billion from Chile’s Economy

• Crime in Chile costs the economy $8 billion each year.
• La Piojera’s sales are down by a shocking 60% this year.
• Manager Mauricio Gajardo has seen alarming changes in customer behavior.
• Bar & Vuelvo employs discounts to attract later-night customers.
• Violence has led students to shift their going-out habits to earlier in the day.

Impact of Crime on Economic Growth in Chile

Rising crime rates are having a chokehold on businesses and economic growth in Chile, particularly in the capital city. A famed bar called La Piojera, known for its vibrant atmosphere and traditional Chilean offerings, is feeling the pinch as crime numbers continue to climb. According to a study from CLAPES UC, the research institute associated with Universidad Catolica in Chile, the nation loses nearly 2.6% of its GDP, translating to a staggering $8.2 billion annually due to crime-related issues.

Local Businesses Facing Tough Times

Manager Mauricio Gajardo of La Piojera is concerned. His sales have decreased by 60%. He lamented how the bar, once bustling with patrons even late into the night, is now forced to close at around 8:30 p.m. instead of a much later hour. Despite assistance from municipal guards, the perception of danger in the area continues to deter customers, which is only adding to the pressures on local businesses.

A Shift in Social Behavior Due to Crime

Other establishments attempt different strategies to cope with declining clientele. Cristian Gonzalez, manager of Bar & Vuelvo, has noted a significant drop in business past 10 p.m., prompting the bar to introduce discounts to lure in customers late at night. The trend of changing social behavior among the locals, including university students like Jose Tomas Rodriguez, indicates a broader societal shift. Rodriguez shared that he and his friends now prefer outings in the afternoon as a reaction to the heightened fear of crime after dark.

The report highlights a concerning reality: crime is not just a safety issue in Chile; it’s deeply affecting the economy. Businesses are struggling, changing their operational hours, and some are even altering their entire business models in an effort to stay afloat. This situation reflects a larger trend in the country where social habits are being reshaped by increasing violence, ultimately reshaping the American Dream for many Chileans.