"Today we begin the road to Brazil 2014. Football lives off the successes of efficiency but none of that counts if there is no joy. Claudio Borghi brings these factors together perfectly... and his game is fun, that's what Chile wants," Jadue told a news conference.
"Claudio's contract begins on Wednesday, March 9, but he starts working for Chile from now."
Borghi's contract is until the end of the South American World Cup qualifiers in late 2013. It will automatically be extended if Chile qualify for the finals.
Former Argentina striker Borghi, who made his name as a coach in Chile with Colo Colo between 2007 and 2008, had been out of work since resigning from Boca Juniors in his home country in mid-November.
Bielsa, who steered Chile to their first World Cup finals since 1998 last year and was popular with players, fans and media, quit this month over differences with the ANFP's new leadership.
The Copa America will be played in Argentina from July 1 to 24.
Chile, who reached the second round of the World Cup in South Africa, are in Mendoza-based Group C with Uruguay, Peru and Mexico.
Borghi's first match in charge will be a friendly away to Portugal in Leiria on March 26.
BIELSA LEGACY
Borghi, a gifted striker who helped Argentinos Juniors win the Libertadores Cup in 1985 and Argentina win their second World Cup in Mexico the following year, has a tough act to follow.
Bielsa transcended football with his popularity in Chile as he steered his team to second place behind Brazil in the 2010 World Cup qualifiers including a first ever win over Argentina in a competitive match.
In his favour, Borghi knows many of Chile's present internationals having coached them at Colo Colo including goalkeeper and captain Claudio Bravo and striker Humberto Suazo. He too is well liked by Chileans.
"Bielsa's results were very good. But anyway, always after someone has done well or badly, another has to come along. We feel capable, we know the place... I hope to take advantage of what Marcelo Bielsa left," Borghi said.
A man who likes to be close to his players rather than keep the distance the older Bielsa maintained, he is criticized for being emotional and impulsive and prone to at least threatening to resign if results go against him.
On the field, Borghi's teams are less rigid tactically than Bielsa's as he gives his players more freedom of expression.
Borghi finished his playing career in Chile where he made a home nearly 20 years ago but returned to Buenos Aires in 2008 and, after a disappointing spell at Independiente, steered his former club Argentinos to the Clausura championship last May.
He was a popular choice with Boca fans when appointed last May but, always with his heart on his sleeve, was unable to cope with the huge media spotlight on Argentina's most popular club and, in particular, criticism of his three-man defence.
Borghi was also unlucky that Boca's brilliant playmaker Juan Roman Riquelme was unavailable for all but one of his matches with the team and he left after five wins and seven defeats in 14 matches.
