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Argentina’s main presidential candidates are ignoring the biggest problems

Mauricio Macri doesn’t want to talk about the economy. Alberto Fernández wants to keep the focus off his running mate

THE MATANZA RIVER, known more commonly as the Riachuelo, or little river, is one of the world’s most polluted. Flowing south of Buenos Aires, it carries human and industrial waste into the much larger River Plate. Argentina’s government is now cleaning it up, helped by a $1bn loan from the World Bank. The project includes new sewers and will provide clean water to 4m people. “There’s nothing glitzy or showy about this,” says the government’s infrastructure chief, Pablo Bereciartua, as he guides your correspondent through purification tunnels newly built beneath the river bed. “What can be more important than clean water?”

In fact, show is part of the point. Argentina’s president, Mauricio Macri (pictured), plans to put such projects at the centre of his campaign for re-election, which he launched with a rally in Buenos Aires on July 10th. Television and social-media adverts boast of the public works carried out by his government. “This is not a story being told you. It’s for real,” Mr Macri tells a voter, who is on his knees inspecting a freshly paved road, in one television spot. Then the president himself bends down to pat the asphalt himself.

His handlers are touting roads and sewers because they dare not focus on the economy. Annual inflation is higher than 50%, GDP has been shrinking since the middle of last year and the unemployment rate is 10%. The government is cutting overall spending and raising the prices of public services to comply with the terms of a $57bn loan from the IMF.

Mr Macri’s main challenger, Alberto Fernández, is also running a campaign based on distraction. He wants voters to forget about the record of his political mentor, Cristina Fernández de Kirchner, who was president from 2007 and 2015 and is now his running mate (but is not related to him). Her mismanagement of the economy contributed to today’s recession and high inflation. She and several officials from her government are on trial for corruption. About a third of voters, mostly poorer ones, still like her. The middle class shudders at the memory of her presidency.

Her protégé, Mr Fernández, is little known. He wants voters to believe he is his own man. In adverts he declares himself an “ordinary guy” and tosses a ball to his collie, Dylan. When an image of Ms Fernández fleetingly appears, he pointedly remarks that when he disagrees with something “I say no.” The two Fernándezes are the most prominent of the candidates who made their careers in the Peronist movement that has dominated Argentina since the 1940s. Roberto Lavagna, an economy minister in a Peronist government in the early 2000s, is also running.

The need to distract has pulled both of the main campaigns towards the centre ground. Mr Macri recruited a prominent Peronist, Senator Miguel Ángel Pichetto, to be his vice-presidential candidate. Compared with Ms Fernández, who defaulted on Argentina’s debt, Mr Fernández is a pragmatic moderate. Although he promises to “rework” the IMF agreement if he is elected, he says he hopes to do it in a way that respects Argentina’s international commitments.

The first test of the two campaigns will come on August 11th, when the parties are due to hold primaries that formally select their candidates. All the candidates are running unopposed, so the main question will be how many voters participate in primaries for Mr Macri’s Juntos por el Cambio (United for Change) coalition, Mr Fernández’s Frente de Todos (Front for All) party and Mr Lavagna’s Consenso (Consensus) 2030. Argentines will also elect a new congress and the governors of most provinces.

Opinion polls conducted in late June suggest that Mr Macri is behind Mr Fernández but gaining on him. That is partly because of signs that the government’s economic policies are starting to work. Inflation has been slowing since April. The peso stabilised in April after the IMF authorised the central bank to spend more money to defend it. The interest-rate spread of Argentine bonds over those issued by the United States, a measure of country risk, has dropped from ten percentage points to about eight. Pundits expect Mr Macri and Mr Fernández to survive the first round of voting on October 27th.

Sergio Berensztein, an analyst, told foreign investors recently that Mr Macri has “a fighting chance” to win the run-off on November 24th. It will help if the economy gives him something to boast about.



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