(Bloomberg Opinion) -- Former student activist Gabriel Boric has won Chile’s most contentious presidential race since its return to democracy. He’s the youngest president-elect to date and the most liberal since Salvador Allende in 1970. The 35-year-old progressive must now incontrovertibly jettison his radical early rhetoric, even at the expense of displeasing his firebrand allies. Without pragmatism and a wide coalition, he has little hope of governing, let alone tackling the deep social and economic grievances that brought him to power.
Boric has already gotten off to a better start than others in the region this year. His ultraconservative opponent, José Antonio Kast — a man who defended dictator Augusto Pinochet’s legacy and portrayed himself as a firm hand on crime and immigration — rapidly conceded and promised “constructive collaboration.” That’s good news for a democracy still grappling with the divisions laid bare by street protests in 2019. It helps that Boric won with a decisive 56% of the vote in Sunday’s runoff, and with the most impressive turnout since voting became voluntary in 2012.
Yet the stakes for his presidency are still exceedingly high. Chile, long a regional symbol of prosperous moderation, can hardly afford the kind of radicalism Boric once dabbled in. Markets will be closely watching the world’s largest copper producer for further signs of an anti-capitalist turn. And other polarized electorates in the neighborhood — including in Brazil and Colombia — may well view the new administration as a model, whether to be copied or avoided.
Boric now has to reconcile the generous new social contract he promised with the economic realities of rising inflation and sharply slowing growth. He also needs to listen to the uneasy voters who propelled Kast from the fringes to the second round of the presidential race, most of whom want better services, but not revolution. All the while, he faces a divided congress, as well as the uncertainty that comes with a new constitution, due to be put to voters next year.
He should start by building a broad coalition to advance his social and economic agenda, bringing in centrist advisers to counter his relative inexperience. Selecting a minister of finance from among his recently widened team of economic advisers, which includes former central bank President Roberto Zahler, would be a good first step. This choice will be vital to reassure the rattled investors and savers who have pulled billions out of Chile over the past two years ($8.8 billion in the six months to August alone, according to the central bank), swapped deposits out of pesos, and driven up borrowing costs. Boric must demonstrate that while he’s a frequent critic of Chile’s centrist parties, he can still work with them.
Crucially, he also needs to show that his promises to improve basic services, stabilize pensions and accelerate redistribution efforts will not come at the expense of the fiscal moderation that has set Chile apart for so long. It’s hard to see how he can avoid a wider budget deficit in the near term, but he can make a commitment to long-term prudence. Only then can Boric move to his priorities, including reforms to education, labor laws and health. There are also migration challenges and clashes with the Mapuche, the country’s largest indigenous minority, in the south.
None of this will be easy. But Boric has shown a willingness to compromise and adapt, reaching out to centrists and acknowledging mistakes. By building bridges, he can hope to make some advances and set a welcome precedent. By pandering to extremes, he can only overpromise and underdeliver.
Editorials are written by the Bloomberg Opinion editorial board.
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