MONTEVIDEO, Uruguay _ Paraguay's electoral court declared Mario Abdo Benitez, a former senator from the ruling Colorado Party, the winner of Sunday's presidential election.
Abdo Benitez, 46, had 46.5 percent of the vote, with 97.3 percent of voting stations counted at 9:35 p.m., according to preliminary results from the electoral court. Former public works minister Efrain Alegre trailed with 42.7 percent of votes. Speaking at a news conference after the court's statement, Alegre thanked his supporters, saying he respected the initial results, but would wait for final certification. The winner will take office Aug. 15 when tobacco magnate and incumbent president Horacio Cartes steps down.
If confirmed, Abdo Benitez will inherit one of the fastest growing economies in South America, but one that still suffers high levels of poverty and inequality. He has pledged to keep taxes low, but do a better job of collecting them to find higher spending on education and health care. The former senator has also promised to renegotiate the terms under which Paraguay sells power from the hydroelectric dams it shares with Brazil and Argentina.
"We see no major macro risks stemming from the elections, but the public sector debt burden is likely to continue moving higher," JP Morgan strategist Diego Pereira said in an April 12 note.
Paraguay has enjoyed a rare period of sustained growth during Cartes' five-year term, with the economy expanding by an annual 6 percent between 2013 and 2017. However, an economic boom fueled largely by soybean and beef exports hasn't erased many of the country's dismal social indicators. More than a quarter of the population remains below the poverty line, and about a third of 15- to 19-year-olds don't receive any formal schooling.
Bondholders have certainly benefited from the landlocked South American country's impressive GDP numbers and reasonably solid public finances. As of last week, Paraguay's U.S. dollar debt had returned 42 percent since Cartes took office in August 2013, compared with average emerging market gains of 31 percent in that period, according to data compiled by Bloomberg.
