UPDATE 1-Chile ministers await fate; few seen safe in mass Cabinet shuffle

May 7, 2015 3:23 PM

* President Bachelet asked all ministers to resign

* Only the foreign minister is confirmed as safe

* New poll shows approval at historic low of 29 pct (Adds latest poll results, political and economic details)

By Rosalba O'Brien

SANTIAGO, May 7 (Reuters) - Chile's Cabinet ministers were waiting to learn their fate on Thursday, with few regarded as certain to keep their jobs, after President Michelle Bachelet made a surprise announcement on Wednesday night that she had asked them all to resign.

A visibly perturbed Bachelet said in a TV interview that she was looking to shuffle the entire Cabinet within 72 hours. Although a partial shuffle was expected, just over a year into her second term, the way it was announced caught Chileans off-guard.

The center-left president has been stung as her popularity has dropped to record lows just as she is trying to push through ambitious reforms to education and labor relations.

The latest survey, published by pollsters CEP on Thursday, showed her approval rating falling to 29 percent, as voter trust has declined following financial scandals that have tainted politicians, business leaders and Bachelet's own family.

A majority of Chileans were also skeptical about the government's reforms, with some 65 percent in the poll saying the measures were improvised rather than well-planned.

By acting decisively, the president will hope to deflect criticism and preserve Chile's reputation as one of the least-corrupt countries in Latin America, but some questioned whether her move smacked of desperation.

"It's enough to get rid of the rotten apples. With this (move) Bachelet is suggesting that the whole barrel is rotten," said Chilean political analyst Kenneth Bunker.

FOREIGN MINISTER SAFE

Government spokesman Alvaro Elizalde, whose own job may be on the line, said on Thursday the only minister who is safe is Foreign Minister Heraldo Munoz.

Munoz has continued to score highly in opinion polls, and has been in the Hague this week to make Chile's argument against a sea-access claim lodged by Bolivia at the World Court.

Finance Minister Alberto Arenas, who is in New York as Chile readies an international bond issue, would traditionally be untouchable - in the last five governments, the finance minister has stayed in post for the entire duration of those administrations. However, Arenas' relationship with the business community has been strained following an unpopular tax reform at a time when the economy has been slowing.

Interior Minister Rodrigo Penailillo is seen by observers as a likely target to be removed from office after reports linked him to a company at the center of one of the corruption probes.

Bachelet's chief of staff, Ximena Rincon, is also seen as vulnerable. (Additional reporting by Antonio de la Jara, Fabian Cambero and Felipe Iturrieta; Editing by Peter Galloway and Matthew Lewis)

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