El Salvador: return of the right

WHAT The victory by the right-wing National Repblican Alliance (ARENA in Spanish) in last week’s legislative elections was modest. But the party looks well-positioned, for the 2014 presidential vote.

WHY ARENA gained just one seat in the Congress. But a new right-wing group led by former President Antonio Saca managed only a distant third-place finish, which suggests that Saca’s party may not do much to attract voters in 2014. Meanwhile, President Mauricio Funes’ center-left Faribundo Martí National Liberation Front (FMLN in Spanish) lost four seats, a sign of its increasing unpopularity, mainly as a result of a weak economy since 2008.

WHATS NEXT A critical issue for El Salvador is the rich-poor gap, which doesn’t seem likely to improve, without more left-right compromise. A lack of confidence in an FMLN administration on the part of local investors contributed to near-zero economic growth in the country since 2008.

A return to power by the right would persuade many of El Salvador’s top business people to develop new projects locally. But an ARENA government would likely spend less on education and health, which in turn makes it more likely that El Salvador’s chronic problems of poverty and violence persist.

For more information, please contact Esteban Alvarez, at [email protected]