Fujimori vs. a Pro or an Anti Market Rival?
The latest polls confirm that Keiko Fujimori will be forced into a runoff after the April 10th general elections. Results show her commanding 30% to 35% of voter intention, and slightly above 40% of the valid votes—but short of the 50% she’d need for a first-round win. Demonstrations against her are likely to increase, (so far have not had significant effect) but could disturbed the runoff outcome in June.
Ex-prime minister Pedro Pablo Kuczynski remains in second place, with 15% to 17% of voter intention, and nearly 20% of the valid votes. But close on his heels is particularly left wing Veronika Mendoza, increasing strongly her popularity in the last weeks practically equating Kuczynski.’s vote preference. Alfredo Barnechea has lost steam dropping to less than 10% of valid votes, while Alan Garcia commands no more than 7%.
The elections have been plagued by lawsuits aimed at excluding competitors. One such action had candidate Cesar Acuña banned by the Electoral Tribunal. Candidate Julio Guzman was also excluded, due to illegal procedural practices during his registration. The Court has rejected further calls for exclusion (such as those aimed at Fujimori and Kuczynski) due to the lack of strong evidence that controversial gifts were offered or given by the candidates personally.
Against this peculiar backdrop, the focus has moved away from policy proposals, and toward whether justice is being applied equally to the candidates. The climate has also revived strong rivalry between Fujimorism and anti-Fujimorism, partly due to Fujimori’s lead, and partly over differences in perceptions of the performance of her father’s government. Her opponents stress Fujimori pére’s corruption and authoritarianism; supporters point to economic transformation, the end of hyperinflation and the defeat of terrorism. The popularity of both President Ollanta Humala and first lady Nadine Heredia continues to decline, to 15% and 10% respectively. Those results made them withdraw their candidate and congressional slate, to keep their party eligible for future elections. The president will likely adopt last-minute measures to increase its popularity, and to restrict policy options for his successor. Last week he raised the minimum wage by 13%. We would not be surprised to see other populist measures, such a public spending hike.
Leading indicators for February continue to support our estimate of GDP growth in the order of 5.0%. Domestic investors still anticipate sol depreciation in the year, despite the recent appreciation trend.
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