The General Assembly approved the appointment of Bachelet to be the next UN high commissioner for human rights, replacing Zeid Ra'ad Al Hussein, a sharp critic of US President Donald Trump's policies.
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Bachelet, 66, served twice as president, championing socialist policies in her country. During the dictatorship of Augusto Pinochet in the 1970s, she was detained for several weeks and tortured.
Speaking to reporters, Guterres praised Bachelet as "perfectly suited" for the job but warned she takes office "at a time of grave consequence for human rights" in the world.
"Hatred and inequality are on the rise," he said.
Respect for human rights law is on the decline, civil society is being squeezed out and press freedom is under pressure, Guterres added.
In a video posted on Twitter, Bachelet said in Spanish that she was "deeply humbled and honored" by the appointment and pledged to bring "all of my energy and convictions" to the job.
Bachelet steps into a position that has drawn much controversy under Zeid, who decided not to seek a second term after losing support from the United States, Russia and China.
Strong advocate
Zeid criticized Trump for his policies on refugees, his attacks on the media and more recently for his decision, which was later reversed, to separate migrant children from their parents at the US-Mexico border.
Guterres made clear he believed Bachelet could resist pressure to refrain from speaking out on human rights.
"To navigate these currents, we need a strong advocate for all human rights," said Guterres. "We need a person who can ensure the integrity of the indispensable human rights mechanisms of the United Nations."
Zeid said in a statement he was delighted with the appointment of Bachelet. "She has all the attributes – courage, perseverance, passion, and a deep commitment to human rights – to make her a successful high commissioner," he said.
Bachelet will take up her new position on September 1. She will be the seventh high commissioner for human rights since the office was created in 1993.
Chile's first woman to hold the presidency, she served in that office from 2006 to 2010, and again from 2014 to March of this year.
A trained pediatrician, Bachelet was appointed in 2010 as the first director of UN Women, the UN agency promoting gender equality worldwide.
Born in Santiago, Bachelet is the daughter of a general who opposed Pinochet's overthrow of Salvador Allende.
Afer her release from detention, she went into exile in Australia and East Germany where she continued her studies in medicine.
Bachelet returned to Chile in 1979, but was prevented from working as a doctor for political reasons. She continued studying, specializing in pediatrics and public health.
After democracy was restored in 1990, she worked for the health ministry and in 2000 was appointed health minister, followed by defense minister four years later.
As president, Bachelet offered a dramatic break from Chile's highly conservative political class. She reformed the pension system and improved health and social services, focusing on Chile's working poor.
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