Margaret Thatcher and Augusto Pinochet are vampires in the new film from the Chilean director Pablo Larraín. Literally so: El Conde (The Count) drapes them in black capes and has them fly over the city, biting the necks of their victims and tearing hearts out of chests. Pinochet, in particular, is voracious and insatiable. The monster likes all types of blood, Thatcher explains with all the cloying condescension of her race and her class. “But naturally English blood is his favourite.”

Larraín – a quick-witted, combative man in his mid-40s – has been fascinated by Pinochet for decades. As a child he watched him on TV and felt an instinctual aversion. As an adult he has made films about the dictator’s corrosive effect on Chilean culture (Tony Manero), the human cost of military rule (Post-Mortem), and the 1988 referendum that finally triggered its downfall (No). Whether he likes it or not, Larraín and the general are now joined at the hip, each defined by the other. Such is the way with all dark obsessions. The more you say about your subject, the more they say about you.

Pinochet, he admits, is the primary fuel in his tank. He can’t begin to imagine what kind of career he would have had if the man hadn’t existed. “But it’s true what they say – for any form of narrative you need a crisis, whether it’s Shakespeare or Greek drama, whatever it is. Crisis. It’s a beautiful word,” he smiles.

It is barely an hour since the film’s unveiling at the Venice film festival and Larraín has been ferried across the lagoon for a celebratory dinner. He wants a gin and tonic in his hand the instant the boat docks and a cigarette he can smoke on the restaurant terrace. The man is still shrugging off the excitement of the premiere. Perhaps he also needs to acclimatise after another trip through the dark. He says that all his previous work focused on Pinochet’s malign influence. “This time I think I looked evil fully in the face.”

El Conde returns the director to home soil after his recent adventures at Sandringham, shooting the royals in his Diana tale, Spencer. It is dank and exotic – very much in the established Larraín vein – and takes the form of a fabulous black and white creature feature in which the monster (played by the veteran actor Jaime Vadell) cheats death and continues to terrorise modern Chile.

This, Larraín jokes, was such an obvious choice that it barely even counts as a metaphor. Pinochet expired back in 2006 before being brought to justice. There was no proper reckoning, no stake through his heart. A recent poll found that roughly a third of the public still hold him in high regard, viewing the general as a shrewd manager of state finances and a powerful bulwark against socialism, parroting the same old western argument that bankrolled his regime. The truth, Larraín says, could not be more different. The supposed economic miracle was a lie and the country continues to suffer as a consequence. The vast bulk of the wealth is in the top one per cent. Chile’s inequality ratio is among the highest in the world. Maybe discussions around this week’s 50th anniversary of the coup will finally bring closure. All the same, he has his doubts.

The director sips his G&T and stares at the sunset. He says it is the poor and unschooled who bear the brunt of the mess, not the educated elite; they are largely home free. “I mean, I was 12 years old when the referendum happened,” he adds. “And I was raised in a ruling class family, so I was never at risk. For me, life was easy.”

This is undeniably true; he is a child of the regime. Larraín’s father, Hernan, eventually became president of the conservative Independent Democratic Union (although he joined the party in 1991, after Pinochet stepped down). His mother, Magdalena, served in the rightwing government of billionaire businessman Sebastián Piñera, so I am guessing his parents were both sympathisers.

Larraín pulls a face. He has a second cigarette on the go. “I think that particularly my father has been a member of a political party that supported him. Nowadays that’s not his opinion. He might have drifted a bit. But my parents are part of a particular class structure. I’m from that world myself, so it took a little while for me to create my own consciousness. But the fact I am from that world doesn’t mean I can’t make films about it.”

This, it becomes clear, is an issue that vexes him. Who is qualified to tell what story? Who gets to decide who is worthy in the first place? A few years ago, he says, he was profiled by a reporter from the Economist magazine. The writer flew to Venice to interview him at the festival and to New York for a follow-up interview.

“And then this man, this white English gentleman, asks the question: is this man, Pablo, allowed to talk about these subjects, coming from where he’s coming from?” He sucks on his cigarette. “Now, how can this man say I’m not the right person to shoot these subjects in Chile? I’m fucking Chilean, man. It’s my world. How can I not be allowed to talk about the things that happened to us, to me, as a member of my community?”

The nicotine hasn’t helped; he’s boiling over with rage. He puts the whole thing down to colonial attitudes, that inbuilt, antiquated western mindset. “It’s the same as Thatcher, [Henry] Kissinger, [Richard] Nixon – the way they talked about Chile. Read the transcripts of the tapes, it’s all there. ‘Oh, just send them some money. They’re not smart people. Let them fight among themselves.’ You want to know why I put Margaret Thatcher in this film? One of the reasons is because of that guy.” He shakes his head. “It made me understand a lot of things.”

I remind him that this is actually the second time that we have met. I first interviewed the director 15 years ago, when he came to Cannes with Tony Manero, his devastating black comedy about a zombie-like fan of Saturday Night Fever. At the time, he swore blind that he would never leave Chile. Since then he has worked in the US on the Kennedy drama, Jackie, and in the UK on Spencer, a lush gothic fable about Charles and Diana’s broken marriage.

The latter, he explains, provided him with further insights into how we live in England. “Dysfunction, complexity, that was my main takeaway. It’s a great country, England, with a wonderful culture. But it’s also a country of pirates, full of people who are still in love with the royals, even the king you have now, who is impossible to understand – he is such a charmless person.”

In any case, he mainly made Spencer for the benefit of his mother. Back in the day, Magdalena used to model herself on Diana. Same hairstyle, same outfits, the works. “So she loved the film,” he says and then stops short, reconsiders. “Maybe she would have wished that it was a little less dark.”

Dinner is served, but Larraín isn’t ready to shift tables. He says he recalls our last meeting and knows full well what he said. “And I don’t think that I betrayed any promise I made, if that’s what you are thinking. I’ve had the chance to live in LA, New York, wherever. But my kids are in Chile and my bed is in Chile and that’s what I am, I am a Chilean film-maker.”

• El Conde is out on Friday in cinemas and on 15 September on Netflix.