Peru Picks President and Mexican Voters Give Verdict on AMLO

Peru and Mexico are holding elections on Sunday with voters in Latin America angry over the economic devastation left by the pandemic, and the mishandling of the health crisis.

Peru Picks President and Mexican Voters Give Verdict on AMLO

In Peru, the choice in a presidential runoff is between Keiko Fujimori, an autocrat’s daughter accused of corruption, and Pedro Castillo, a radical from a Marxist party who was virtually unknown at the start of the year.

In Mexico, Andres Manuel Lopez Obrador, known as AMLO, faces his biggest test of a six-year presidency in midterms in which his party and allies will try to keep a super-majority in the lower house of congress. Fifteen state governorships are also up for grabs, along with local posts.

The campaign has been violent even by Mexican standards, with dozens of candidates killed, kidnapped and threatened.

For Latin America as a whole, Sunday’s elections could preview the direction in which other countries may be heading, as establishment parties lose support and outsiders gain ground with promises to spend more to address the rise in poverty.

As voting got under way in both countries on Sunday, Mexico had received fewer election complaints than anticipated, according to Jose Agustin Ortiz Pinchetti, the Attorney General’s prosecutor of electoral crimes.

“The most important point I can convey is the scarcity of complaints. According to preliminary inquiries, complaints have just surpassed 1,000, much less than expected,” he said in remarks sent to reporters.

There were some acts of violence and ballot burning in certain states, including Chiapas, Oaxaca, the State of Mexico and Veracruz, according to national newspaper Reforma. In the State of Mexico a group of people overturned tables, destroyed ballot boxes and attacked citizens who were going to vote, video taken by neighbors showed.

Chile, Colombia, Brazil

Elsewhere in the region, a group of independents and leftists will be rewriting Chile’s constitution, and a communist candidate is the frontrunner in polls ahead of November elections.

Colombia, which has been rocked by violent street protests triggered by a doomed attempt to raise taxes, will elect a new government in the first half of 2022. Early polling shows a leftist former guerrilla in the lead.

In Brazil, former president Luiz Inacio Lula da Silva is riding a wave of discontent over Jair Bolsonaro’s handling of the pandemic to lead polls as he considers a run next year.

Wealth Taxes

Latin America has long been among the world’s most unequal regions, but that gap has grown since the pandemic hit, and vaccination drives got off to a slow start. Lawmakers have tapped into the anger to pass new wealth taxes and release tens of billions of dollars from private pension funds.

Governments are running larger deficits, seeing their credit ratings cut and are fighting an upsurge in inflation.

Peru Picks President and Mexican Voters Give Verdict on AMLO

In Peru, investors fear that decades of macroeconomic stability may be at stake. Fujimori promises to keep investor confidence, maintain law and order and boost payments to families affected by Covid-19. Castillo wants to extract more taxes from multinational miners and oil drillers to spend more on education and health.

Castillo’s top economic advisor, Pedro Francke, said this week that the candidate would pay the nation’s debt, respect the central bank’s autonomy and has no plans to nationalize Peru’s mining sector. But many investors are skeptical. Fujimori has run her campaign by telling voters that Castillo will turn Peru into Hugo Chavez’s Venezuela.

Wild Swings

Peru’s markets have swung wildly in the past two months, with a sell-off whenever Castillo gained in polls. The sol has weakened 6% since the April 11 first round, the biggest drop among major emerging markets over the period.

Peru’s campaign was also roiled by violence when 16 people were massacred in a remote village by what authorities said was an offshoot of the Maoist guerrilla group Shining Path. Fujimori has called for a hard line on the movement, and her campaign got a boost from the event.

On top of the political and financial drama, Peru recently acknowledged that the official death toll from Covid was nearly three times the previous figure, meaning that some 180,000 people have perished from the disease in a country of 32 million.

In Mexico, Lopez Obrador appears to have escaped voters’ ire over the health crisis which has led to 228,000 deaths, the world’s fourth-highest total, as well as the economy’s worst slump since the 1930s. Despite strong personal ratings, however, voters see his government as having performed poorly on the economy and security.

Peru Picks President and Mexican Voters Give Verdict on AMLO

A strong showing for Lopez Obrador could mean retaining a super-majority in the lower house that could allow him to roll back the privatization of the energy sector.

Polls are open from from 7 a.m. to 7 p.m. local time in Peru, and from 8 a.m. to 8 p.m. in Mexico. Preliminary results are expected in both countries later on Sunday evening.

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