Argentines shy away from populism in key Senate primary
By Caroline Stauffer and Jorge Otaola BUENOS AIRES (Reuters) - Argentina's business-friendly president's preferred candidate looked set to pull off a surprise win in a closely watched Senate primary on Sunday, an apparent upset over populist former president Cristina Fernandez in Buenos Aires province. With 61.81 percent of polling stations counted, President Mauricio Macri's coalition led by former education minister Esteban Bullrich had 35.40 percent of votes compared with 32.98 percent for Fernandez's list in the province, which is home to nearly 40 percent of Argentina's electorate. Fernandez had been expected to win by several percentage points according to the final polls last week, causing investors to fear a comeback in Congress could pave the way to her running for president in 2019 and ending Macri's reform agenda. The compulsory primary vote essentially serves as a detailed poll ahead of the Oct. 22 election for one third of the Senate and half the lower house of Congress, because no major candidates are being challenged from within their own parties. No matter how many seats his "Let's Change" coalition picks up in October, Macri will still lack a majority in Congress and must build alliances to pass reforms, but analysts say a defeat of Fernandez would strengthen his negotiating position. Bullrich, a little-known politician who made several notable gaffes in the final weeks of campaigning, was aided by recently improving economic data as well as support from the popular governor of Buenos Aires province, Maria Eugenia Vidal. "We know you hoped the improvements would come faster," said Vidal, who herself pulled off a surprise upset for "Let's Change" in Buenos Aires province in 2015. "This country and this province are profoundly changing into something truly different," she said. FOLLOW THE PLAN Shortly after taking office in December 2015, Macri lifted currency controls, eliminated export taxes and restrictions on grains, and settled a legal dispute with creditors that paved the way for Argentina's return to global debt markets. He also began cutting costly subsidies for utilities like gas and electricity in a bid to reduce the country's fiscal deficit. The moves were praised by investors who were spooked by Fernandez's interventionist policies, but a 2.2 percent economic contraction and inflation above 40 percent last year cut into Argentines' purchasing power, generating frustration with the government. Booming farm activity and an increase in public works spending have contributed to a nascent economic rebound, but it has not yet been felt in many parts of Buenos Aires province's industrial belt, where Fernandez's message appeals to many. "(The government) has to continue to follow its current political plan because, if it doesn't, it can't advance in its growth plans," said Lidia Galleta, 55, from Buenos Aires City, where Macri's candidates won handily. Argentina's peso had weakened around 9 percent since Fernandez formed a new political party and declared her candidacy on June 24. Fernandez was president from 2007 to 2015 and was indicted for corruption last year. Under Argentina's election system, the winning party in each Senate race gets two of the province's three seats, with the remaining seat going to the second-place finisher. A second-place finish would thus still grant Fernandez, 64, a Senate seat, which would give immunity from arrest, although not from trial. She dismisses the corruption accusations as politically motivated. (Additional reporting by Nicolas Misculin, Walter Bianchi, Luc Cohen and Maximiliano Rizzi; Writing by Caroline Stauffer and Luc Cohen; Editing by Andrew Hay, Chris Reese and Paul Tait)
