Colombian outsider makes runoff with real shot at presidency

Bloomberg

A construction magnate who was little known at the start of the year surged into presidential runoff with a real chance at winning as voters coalesce against his leftist rival.
Rodolfo Hernandez took 28% of the vote to 40% for Gustavo Petro, a former mayor of Bogota and onetime guerrilla, the electoral authority said. Hernandez beat out Federico Gutierrez, the main conservative candidate, who had 24% backing.
The result sets up a June 19 contest between Hernandez, a populist whose policies are largely a blank slate, and a frontrunner in Petro who would phase out the oil and coal industries, effectively ripping up the economic model at a time when Colombia is enjoying a bonanza from high energy prices.
“Investors are mainly worried about the chance of a Petro victory, so they’ll view positively any scenario in which he doesn’t win,” said Andres Pardo, chief Latin America macro strategist at XP Investments in New York. “But the truth is that with Rodolfo Hernandez, there’s a huge question mark.”
Peru and Chile have elected unconventional presidents in the past year, and Colombian voters too made clear their desire for change by rejecting candidates supported by more traditional parties. In all three countries, the pandemic aggravated deep
inequality, and while Colombia’s economy has rebounded strongly, voters are struggling with issues including inflation, unemployment and corruption.
Markets are closed for a public holiday, but Colombian assets are likely to rally at the open on Tuesday, according to Pardo and Daniel Velandia of Credicorp Capital. That’s because third-placed Gutierrez and many of his key supporters have already endorsed Hernandez.
Hernandez, Gutierrez and a candidate of the political centre, Sergio Fajardo, took about 12 million votes between them compared to 8.5 million for Petro, potentially giving the businessman the upper hand in the runoff.
While Brazil, Mexico, Peru, Chile, Argentina and Venezuela have all elected left-wing leaders at various times in their histories, Colombia has until now only ever been governed by conservatives and liberals.
President Ivan Duque isn’t running, and Gutierrez was seen as the continuity candidate of an unpopular administration.
“Most of Gutierrez’s backers will go for Rodolfo,” said Sergio Guzman, director of Colombia Risk Analysis. “What becomes critical now is for Hernandez to start putting a team together and start naming possible cabinet members.”
While Petro, 62, has served as mayor of the capital, a senator and has run for president before, Hernandez, 77, is far less well known, and his stance on many issues remains unclear.
Hernandez made a fortune building homes for low-income families and was mayor of the provincial city of Bucaramanga. He’s been compared to former US President Donald Trump for his brash and unpredictable style.
“Today, the country of dirty politics and corruption lost,” Hernandez said, speaking by live video link from his kitchen in Bucaramanga.