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Colombia | Presidential elections: everything is yet to be defined as a second round seems guaranteed

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May 16, 2014 (www.investorideas.com newswire) With just a week remaining for the first round of presidential elections (25-May), polls point to a higher probability of a second round than in previous weeks, amid a scenario in which Oscar Ivan Zuluaga continues to gain more support by voters while Santos loses some ground.

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According to the latest Gallup's poll (our preferred survey) which was released yesterday, president Juan Manuel Santos and Oscar Iván Zuluaga (the candidate of the former president Alvaro Uribe's party, Centro Democrático) would have a technical tie (29.0% vs. 29.3%), implying a second round would be guaranteed.

In general terms, the recent trend has been more favorable for Zuluaga as has increased by 19pp in the last three months while Santos has lost 6pp in the same period. It might be argued that as the first round is closer, more electors have started to define their candidate, benefiting Zuluaga particularly. In effect, the blank vote went from 16% in Apr-14 to 6% currently.

Martha Lucía Ramírez, from the Conservador party, stands currently in the third position, advancing from 11% to 14%, followed by Clara Lopez from the left-wing Polo Democrático party (10.9%) and Enrique Peñalosa from the Alianza Verde party (10.6%) (see chart 1).

In a second round, Gallup's poll results suggest that Zuluaga would beat Santos by 7pp (42.5% vs. 35.1%). This is in a stark contrast with the results of the Apr-14 survey, in which Santos surpassed Zuluaga by 12pp. In fact, the poll shows that in a second round it would have been a technical tie between Santos and Clara López and Santos and Ramirez, while Santos beats Peñalosa by just 4pp (see chart 2).

These results suggest that a second term for Santos is facing more challenges now than in last weeks. Particularly, Santos would be losing some support in the Southwest of the country (from 36.1% in Apr-14 to 25.8% in May-14) although he is now leading Bogotá's vote intention (25.3%) while Peñalosa led one month ago with 23.6%.

It must be highlighted that recent weeks have been framed by scandals, which surely continues generating confusion among voters. On the one hand, Santos has been accused of having received illicit resources for his presidential campaign in 2010. On the other hand, a hacker was found in the Zuluaga's campaign several days ago, who was supposed to be spying the communications between the two parties of the peace talks. Investigations about the two subjects are initiating.

Likewise, it must be recognized that some events have occurred recently, which were not considered in the Gallup's poll as it was carried out between May 10th and May 13th. First, the Progresistas party, which is a left-wing party led by current Bogotá Mayor, Gustavo Petro, confirmed its support to Santos based on the current peace process. Second, ex-president César Gaviria from the Liberal party, was named as the Santos' campaign director. Finally, while we wrote this report, it was known than the third point of the peace talks agenda was agreed today. Hence, the Government and the FARC have agreed on 3 out of 5 points, namely, rural development policy, political participation and drugs. Further details on the latter are expected.

It is very difficult to assess the possible impact of all these recent events on electoral results, particularly due to the current polarization environment in the country. Hence, everything is yet to be defined. In any case, we continue to consider that the probability of a new government that can jeopardize the macroeconomic stability and investment climate is rather low.

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To View Complete Report: Presidential Elections 2014

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