Neuquén election results give Cambiemos symbolic win
The first major election results of 2019 have produced a positive result for the government. On March10th voters from Neuquén province took to the polls to elect local legislators and the governor. Although, as expected, the ruling Cambiemos coalition's candidate lost the race for governor, the vote also demonstrated a lack of support for the left-wing opposition. This will reassure the president, Mauricio Macri, as campaigning for the October presidential race kicks into gear.
The elections maintained the status quo: Omar Gutiérrez of the moderate Movimiento Popular Neuquino (MPN, a party that dominates local politics) was re-elected governor. He beat Ramón Rioseco of the left-wing Unidad Cuidadana (UC, a breakaway faction of the Peronist party led by the former president—and presidential front runner—Cristina Fernández de Kirchner, 2007-15) and Horacio Quiroga of the ruling Cambiemos coalition.
Notwithstanding Mr Quiroaga's defeat at the polls, the election results came as a relief to the government owing to the fact that pre-election opinion polls suggested a much closer race between the MPN and UC candidates. AUC victory would have given Ms Fernández momentum in the presidential race; it would also have damaged business sentiment (given Ms Fernández's past mismanagement of the energy sector), at a time when the government is looking to attract investment in the large Vaca Muerta shale deposits located in Neuquén. With Mr Gutiérrez remaining at the helm in Neuquén, investor-friendly energy policy will continue.
Despite the symbolic victory, there are some causes for concern for Mr Macri. Ahead of provincial elections in Córdoba, on May12th, cracks have begun to form within the Cambiemos coalition amid disagreements about who should lead the coalition's ticket. The dispute comes amid a busy election schedule. The election in Córdoba will be followed by elections in Santa Fe in June and Mendoza in September (nationwide primary elections are set for August). Local races will be based at least partly on local issues, but this packed election schedule suggests nonetheless that there will be several opportunities to gauge voter sentiment more broadly—and many hurdles for Mr Macri and MsFernández ahead of the main event in October.
Impact on the forecast
The Neuquén results are supportive of our forecast for a victory for Mr Macri in October. We will continue to monitor provincial election results in coming months to measure voter sentiment, although we continue to believe that much will depend on the state of the economy in October