(Bloomberg) -- Chile’s traditional center-right parties won several key races in local elections over the weekend, giving them the upper hand in the opposition over the Partido Republicano just a year before voters return to the polls to select the next president.
The Chile Vamos bloc won mayoral contests in over 120 municipalities, up from 87 in the prior vote in 2021, according to data from elections office Servel.
It wrested control of downtown Santiago and Nunoa from the ruling coaltion in the nation’s capital, as well as the southern city of Puerto Montt. Still, Chile Vamos was unable to retain the mayorship of Chile’s largest municipality, Puente Alto, which had been under its leadership for nearly a quarter-century.
Meanwhile, the ultra-conservative Partido Republicano, which competed in a separate list, gained just eight districts. The party fell short of expectations of obtaining relevant wins in mayoral contests and also becoming Chile’s largest party in municipal council votes, said Gonzalo Muller, director of the Public Policy Center at Universidad del Desarrollo.
The Partido Republicano “lost its fight for the hegemony on the right wing, as Chile Vamos got twice as many votes,” he said. “It will be forced to change its strategy on its relationship with the center-right.”
Voting in the local elections was obligatory, meaning they provide investors with a clear picture of the balance of power just over a year from the nation’s presidential contest. Parties on the right are benefitting from their tough stance on crime and clandestine migration, both of which rank among top voter concerns. Still, some of their members have been caught up in a growing corruption scandal known as Caso Audios.
“The right is regaining electoral ground,” Claudio Fuentes, a political scientist at Universidad Diego Portales, posted on X. But “one cannot speak of a dominant political force in Chile. The presidential race remains open.”
Stock Exchange
The peso appreciated as much as 0.4% early on Monday, while the benchmark IPSA stock exchange rose 0.3%, on track for its eighth straight day of gains.
The election result will have a “neutral to slightly positive impact” on stocks in coming days, Credicorp Capital economists Samuel Carrasco and Rodrigo Godoy wrote in a note on Monday. “In any case, we note that the presidential race is still highly liquid.”
On the left, President Gabriel Boric’s government scored one significant victory over the weekend, with Tomas Vodanovic gaining a landslide win for mayor in Maipu, one of the country’s biggest municipalities. Some see Vodanovic as a potential candidate for the nation’s top job next year.
The ruling coalition also maintained control of the emblematic municipality of Vina del Mar.
Another possible contender for the presidency for the center-left, Claudio Orrego, failed to win a first-round victory for governor of Santiago. He will have to contest a run-off next month with center-right candidate Francisco Orrego.
Neither Vodanovic nor Orrego have said if they are interested in running for the presidency. Early front-runners on the right include Evelyn Matthei from Chile Vamos and Jose Antonio Kast from the Partido Republicano.
“No one can claim an overwhelming triumph” in these elections, Boric told reporters after the vote.
--With assistance from Matthew Malinowski.
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