Costa Ricans are voting Sunday for a new president and congress after a campaign in which gay marriage displaced soaring debt levels as the main topic of contention.
Evangelical lawmaker Fabricio Alvarado has risen to the top of the opinion polls after denouncing the prospect of legalizing same-sex unions. Investor favorite, Antonio Alvarez, who has campaign on the more mundane issue of limiting fiscal borrowing, has slipped to second place, while Carlos Alvarado from the ruling party is in third.
Voting stations open at 6 a.m. and close at 6 p.m. If no candidate wins more than 40 percent of the vote, a runoff between the top two will be held on April 1. The first results are expected at around 7pm or 8pm local time, with a full result later the same evening, according to the electoral authority.
Support for Alvarado, a previously little-known lawmaker, rocketed to 26 percent among decided voters in a January Opol Consultores poll from four percent just one month earlier after the government said it would implement a ruling by the Inter-American Court of Human Rights in favor of gay marriage. The surge in his support triggered the biggest one-day drop in bonds for 14 months as the focus of the debate shifted away from Costa Rica’s surging budget deficit.
“The main issue to be dealt with is the fiscal deficit,” said Vidal Villalobos, head of economic studies for Prival Bank S.A. “Markets are very aware of Costa Rica’s fiscal problems and the country is paying for it.”
Investors are jittery after the fiscal deficit widened to 6.2 percent of gross domestic product last year, the highest since 1983 when the central bank began tracking it. President Luis Guillermo Solis has repeatedly failed to get new taxes through congress.
The nation’s dollar bonds suffered their biggest drop in 14 months on Jan. 23 after a poll showed Alvarado taking the lead.
The Central American nation has suffered a total of five downgrades to its credit rating from Moody’s, Fitch and S&P Global Ratings since 2013. Moody’s had lifted the nation to investment grade, but all three agencies now rate Costa Rica’s bonds as junk.
The central bank said in a report on Thursday that the fiscal deficit will widen further to 7.1 percent of gross domestic product this year and 7.9 percent next year. Debt levels will also rise to a record 53.6 percent of GDP this year and 59 percent next, the bank said.