Uruguay Awaits Final Vote Count as Opposition Holds Lead

(Bloomberg) -- Uruguayans will have to wait several days for final confirmation of who will be the next president after a tighter-than-expected contest triggered a more meticulous official count with the opposition holding a narrow lead in what would be the first shift to the right in 15 years.

Luis Lacalle Pou of the center-right National Party had 48% of 2.4 million votes counted, against 46.8% for the left-wing Broad Front’s Daniel Martinez, according to preliminary results from Sunday’s runoff published by the Electoral Court.

Authorities will start an official count Tuesday that may not yield final results until Nov. 29, the court’s president Jose Arocena told reporters. The winner will start his five-year term March 1, 2020.

Lacalle Pou, speaking past midnight, called on supporters to exercise “prudence and patience“ during the official count that will formalize his “irreversible” victory. He also criticized Martinez’s decision to not concede. Pollsters had given Lacalle Pou a 5 to 8 point lead over Martinez in the days prior to the vote.

“Today’s result confirms that the next government can’t swap one half of the country for the other. We have to unite society,“ he said at a rally outside his campaign headquarters.

Martinez, for his part, said he would wait for the results of the final count. He called on his supporters to avoid “any form of provocation or any form of confrontation“ while the Electoral Court does its job.

Uruguay has managed to avoid the social turmoil and recession that have engulfed other South American countries in recent years. The economy hasn’t stopped growing since 2003, allowing the Broad Front to pour money into social programs, pensions and health care. Even so, the party lost control of Congress in general elections on Oct. 27 as voters grew frustrated with rising unemployment, crime and other grievances.

Looming Negotiations

Lacalle Pou will probably win the presidency, but the Broad Front’s strong showing Sunday will force him to open a dialogue with the left-wing party in the opposition, said Eduardo Bottinelli, a director at pollster Factum.

The Broad Front “ended up stronger than it was before in a certain sense. Put from a practical point of view, the main issue is its legislative weakness. It doesn’t have enough congressional weight” to decide legislation except in the case of bills requiring super majorities, Bottinelli said in an interview.

Should the result hold it would also mark a growing trend in Latin America that’s seeing voters push for change, whether it be from the right or the left, to replace incumbents and try something new. It also comes at a time of increased volatility in the region with violent protests erupting in the Andes from Colombia down to Chile.

The closer-than-expected result may have been driven by a large influx of Uruguayans living abroad who came home to vote in the runoff and Martinez’s revamped door-to-door campaign strategy. Martinez might have also captured moderate voters who were turned off by virulent attacks on the Broad Front by retired military officers and Lacalle Pou ally, ex-general Guido Manini Rios, days before the election, reviving memories of when the military called the shots in the South American nation.

Uruguayans were asked to choose Sunday between an ambitious reform agenda and continuity under a party that says its policies have slashed poverty and inequality. If Lacalle Pou’s slim lead holds, he would become the fourth National Party president in the last 100 years, while his running mate Beatriz Argimon would be the country’s first elected female vice-president.

Lacalle Pou has made cutting the public sector deficit to protect Uruguay’s access to cheap credit a key part of a reform agenda that includes an overhaul of the pension and public education systems. The 46-year-old former senator has cobbled together a five-party coalition spanning the center left to the hard right that would give his presidency comfortable majorities in both houses of Congress if he wins.

Still, if he squeaks through to win the presidency, he could start with a weaker mandate and would have to tread lightly with reforms to preserve social gains with nearly half of the country still supporting the Broad Front.

Lacalle Pou, who has already named his finance, social development and education ministers, told reporters Sunday evening at his campaign headquarters that he would fill the rest of his cabinet within 20 days if he wins the presidency.

Uruguay has one of the lowest borrowing costs in Latin America with the yield spread over Treasuries standing at 1.73 percentage points against an average for the region of 3.87 percentage points. Its benchmark bonds due in 2055 rose 0.1 cent to 116.7 cents on the dollar to yield 4.08% in early trading in New York.

Martinez, 62, has pitched a more gradual approach to the deficit, saying that faster growth and a shake-up of the social security system should do the trick. He’s also promised to create 90,000 new jobs, boost pensions, and retrain 400,000 Uruguayans.

Martinez has touted his negotiating skills as governor of Montevideo -- where he convinced opposition council members to fund public works through bond sales -- to allay concerns his presidency might struggle to pass legislation in the absence of Broad Front congressional majorities.

To contact the reporter on this story: Ken Parks in Montevideo at kparks8@bloomberg.net

To contact the editors responsible for this story: Daniel Cancel at dcancel@bloomberg.net, Carolina Millan

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