Centrists gain upper hand in Brazil's municipal elections

Centrist political parties were the biggest winners in the first round of Brazil's municipal elections over the weekend, suggesting that local governments' concessions and PPP programs will continue unabated over the next four years.

"Both state governors and city mayors have already realized that, given the lack of public funds, the solution for investments inevitably relies on concessions and PPPs. If they don't do this, the public won't be so well served," Roberto Guimarães, former federal finance minister and current director of planning and economics at local industry and infrastructure association Abdib, told BNamericas.

"The agenda for concessions and PPPs is already fairly strong, and there are no signs of any setbacks." 

Brazilians went to the polls on Sunday to vote for mayors and councilors in 5,569 municipalities nationwide. Of these, 26 are state capitals, where 11 mayors were elected in the first round, while a runoff will be required in 15 others. The second round is scheduled to take place on October 27.

If no candidate garners more than 50% of the votes, a runoff must be held.

"The first round of the election showed a clear victory for centrist parties, and even in the capitals where there will be a second round, centrist parties have demonstrated their strength," Mário Sérgio Lima, an analyst at Medley Global Advisors, told BNamericas.

"On the other hand, left-wing and extreme right-wing parties have shown a loss of ground. From the perspective of the business environment, what we can expect from left-wing parties are policies that are already established, with few radical changes."

The PSD and MDB parties had the most mayors elected in the first-round vote, securing 888 and 861, respectively, according to data compiled by Lara Mesquita, a professor at the São Paulo School of Economics and a researcher at FGV CEPESP, which newspaper Folha de S. Paulo published.

"The PSB and MDB, along with all centrist parties, already dominate Brazil's congress. In one way or another, the results of the municipal elections show that these centrist parties, which control a large part of the budget decisions, have secured a political advantage in the cities," said Lima.

"The growing power of centrist parties in both the cities and congress will greatly limit the power of the federal government, which is left-wing, and all government decisions will have to be heavily negotiated."

Other factors

The municipal elections also highlighted some particularities of Brazil's political landscape.

The two main political figures, President Luiz Inácio Lula da Silva and his right-wing rival, former president Jair Bolsonaro, did not play a significant role in the vote. Both decided against taking direct action, reportedly due to fears that it could weaken their political image.

However, both men opted to back candidates publicly in the country's most important city, São Paulo, which experienced one of its tightest-ever elections.

Current mayor Ricardo Nunes (MDB) received 29.5% of the vote and Guilherme Boulos of the leftist PSOL party won 29.1%. Just behind them was Pablo Marçal, a political outsider and candidate of the rightist PRTB party, with 28.1%. Nunes and Boulos will compete in the second round.

Lula backed Boulos, but behind the scenes PSOL members complained that the president failed to campaign actively alongside the candidate. Meanwhile, Bolsonaro publicly supported current mayor Nunes, but did not appear alongside him in the campaign either. 

On the other hand, Tarcísio de Freitas, current governor of São Paulo state and former minister of infrastructure during Bolsonaro's administration, actively campaigned alongside Nunes.

The elections in São Paulo were marked by numerous confrontations between the candidates and their supporters, particularly those of Marçal, who had sought Bolsonaro's support during the campaign. However, he was unable to secure backing from more traditional political forces.

Despite this, Marçal's tight loss demonstrated the strength of right-wing forces in the city.