Meet the Director of the IMF’s Western Hemisphere Department: Nicolás Eyzaguirre
Having served as Chile’s finance minister and as an Executive Director on the IMF’s Board of Directors, Nicolás Eyzaguirre brings knowledge of the region and of the IMF to his role as departmental director. He sees today's IMF as more attuned to the needs of the poor and more focused on transparency.
As a one-time conservatory student, Nicolás Eyzaguirre has always brought a musician’s sensibility to his professional roles. Among the roles: professor of economics, finance minister, central bank director, Fund executive director—serious positions all, requiring mathematical gifts, significant intellect, and the ability to think objectively.
But there’s also the music. While some educational experts have devoted entire careers to unraveling the connection between math and music, this jazz and classical guitarist says simply, “Music is a different source of knowledge.” Eyzaguirre adds that lessons learned fine-tuning his musical ear continue to influence his professional life.
"As a musician, you learn to hear," he explains. To Eyzaguirre, this means putting yourself in the shoes of the people you are trying to help, listening to their perspective on the issues.
Communicating in a language people understand
It also means connecting with people and finding a common frame of reference—not always easy when communicating complex fiscal and economic policies.
"You have to talk with people in a language they understand," Eyzaguirre says. This communication is a mission-critical aspect of the work, he believes. "You can’t hide behind the technical things like numbers and graphs," he says.
During his six-years as Chile’s finance minister, Eyzaguirre made it a point to speak with citizens across the income spectrum. "It was very important to be in touch and to reach out at the most grassroots levels." He lectured at universities and met with students. He visited poor neighborhoods and chatted with residents. And he patiently sat for the occasional interview with aspiring student journalists, who were sometimes more interested in the fact that Eyzaguirre is the son of a famous Chilean actress than in the rationale behind national budgetary decisions.
If you can’t reach people and explain in terms they understand why economic policies are being put in place and how the laws will help, people will not see their value. "So, no matter how beautiful certain laws and policies, they won’t be supported and they won’t work," he says.
As director of the Western Hemisphere Department, Eyzaguirre says he emphasizes communications as a fundamental aspect of the department’s work. He is working with the IMF’s external communications team on ways to connect with the people of Latin America. One of his early efforts: a video interview earlier this year conducted in Spanish.
Focus on the poor
Eyzaguirre also notes that the IMF has a responsibility to help deliver sensible policies that shield the poor, particularly during difficult times. "It is a cruel fact of life that the poor benefit last and least. They are more vulnerable whenever a crisis hits." The Fund can play an important role by encouraging government officials to safeguard public policies targeted to job creation and poverty reduction, he says.
The IMF is more attentive to the plight of the poor today than it was ten years ago when he served on the Executive Board, Eyzaguirre believes. "It is more of a Fund priority to take care of the most vulnerable than it used to be," he says. This is one of several key changes he has observed. "Today, the IMF is a much more open institution and more transparent to its members, and it is also more focused on financial sectors, as well as pro-poor policies."
Worst global economy in 60 years affects Latin America
Eyzaguirre assumed the helm as chief of the Western Hemisphere Department during challenging times. Job one, he says, is to help countries in the region protect themselves, and to contribute to lasting, effective solutions.
Eyzaguirre points to one relative bright spot amidst the bad news on the global economy earlier this year: on the whole, Latin America is managing better than it has during other times of economic crisis. "No region is isolated from the impact, but in relative terms, the resilience of Latin America to external shocks is now much greater than in other episodes. This is critical, because the external environment now facing our region is unusually challenging."
He credits the hard work of the region’s countries for their comparative ability to weather the storms. "These countries have done a lot to strengthen their positions," including sound management of fiscal policies to reduce debt ratios, control of spending to reduce inflation, and improved exchange rate policies.
The Fund has been ready with technical assistance and financial support as needed, he says. He points to a number of high-access precautionary program for countries in Central America or the recently created Financial Credit Lines opened to Mexico and Colombia among others as an example of the protection the Fund has provided. These are countries that have been managing their economy well, and the prospect that large external support would be available if needed has allowed them to pass through this challenging period without any loss of confidence, Eyzaguirre says—an important role in uncertain times.