Argentina Swings Left in Presidential Election

Newly elected Argentinian President Alberto Fernandez (Wikipedia)

Center-left candidate Alberto Fernandez has unseated incumbent Argentine President Mauricio Macri in recent elections. Many hope his election will help reverse Argentina’s current economic crisis. After Fernandez won the primary elections in August by more than 15 points, few were surprised when he won the general election with more than 48% of the vote. Fernandez and his running mate, former President Cristina Fernandez de Kirchner, have promised to increase employment and expand public healthcare and housing programs.

A career politician, Fernandez headed the presidential campaigns of his now running mate Cristina Fernández de Kirchner, as well as her husband and former President Nestór Kirchner. Fernandez served as head of the cabinet of ministers in both administrations. Fernandez is a moderate member of the Peronist Justicialist Party, whereas his running mate leans towards the center-left of the party. 

Fernandez’s electoral victory was partially attributed to the popularity of Kirchner. Many voters told reporters that they were voting for “Cristina,” even though she was the vice presidential candidate. Kirchner has been referred to as corrupt and economically irresponsible, but the resurgence of her popularity has signaled voters’ desire to return to the protectionist economic policies and subsidized living costs of her administration.

This election focused on the country’s economy, as Argentina slipped into a recession last year. Since then, the poverty rate has risen to 35 percent, and one in ten people are out of work. The Argentine peso has also depreciated in value. As of September, inflation for the year was almost 38 percent. Macri attempted to stimulate the economy by investing in key industries such as tourism and agriculture, but he was forced to accept a $56 million bailout from the IMF and impose austerity measures. Fernandez and Kirchner’s campaign promised a return to the “good days” under protectionist Peronist economics in Argentina.

Many wondered how the financial markets would react to this leftward swing in South America’s second largest country.The immediate results seem to have been a mix. When the markets opened immediately after the election, the peso had risen slightly against the dollar and the local Merval stock index was up. However, Argentina’s dollar bonds fell somewhat significantly, which created uncertainty as to what the long term effects of the transition will be. Fernandez and Kirchner are set to be sworn in on December 10.