Bolivia, an important gauge of mood swings in South America, looks poised to embrace the kind of anti-free market politics that are gaining ground elsewhere in the region. As Bolivians prepare to vote on Sunday, opinion polls suggest that the presidential contest will boil down to a run-off between Manfred Reyes Villa, the populist candidate, and former president Gonzalo Sınchez de Lozada, an advocate of free markets. After an often bitter and hard-fought campaign, polls show Mr Reyes' leftist New Republican Force (NFR) party has some 26 per cent of support, giving it a narrow lead over Mr Sınchez's pro-market Nationalist Revolutionary Movement (MNR) and former president Jaime Paz Zamora's Movement of the Revolutionary Left (MIR). If, as expected, no candidate wins more than half of the vote, selection of the president will be left to Congress. If so, lawmakers will face fierce political horse-trading until August 6, when they must choose a leader from the first- and second-place candidates in Sunday's ballot. Mr Reyes, the four-time mayor of Cochabamba, has won support as a "new face" in national politics. He promises to live up to the high-spending reputation he earned when he revamped roads and housing in Bolivia's third-biggest city. As further evidence of the popular quest for an alternative to free-market economics, the "anti-liberalist" movement led by farmers' leader Evo Morales commands 13 per cent in the polls. With extravagant pledges to stop paying foreign debt and to renationalise industries sold to foreigners, Mr Morales' popularity reflects frustration felt by Bolivia's impoverished Indians, who say they have gained nothing from two decades of free-market reforms. The reforms, introduced when the landlocked state returned to democracy in the mid-1980s after decades of military rule, turned Bolivia into a paragon of what the "Washington Consensus" economic model could achieve for developing countries. Defenders of the measures point to Bolivia's success in the 1980s in curbing rampant inflation, streamlining the economy and reducing high levels of poverty. But a backlash against market-driven reforms is building momentum. Anti- free market sentiment is on the rise in Argentina, Paraguay, Brazil and Peru. Last week Lima had to shelve plans to sell two state utilities following riots against privatisation in which two people died. The battle, then, to find a successor to President Jorge Quiroga, the 42-year-old pro-business technocrat who took over from an ailing Hugo Bınzer last August, has focused on free-market reforms and what role the state should have in managing one of the continent's poorest countries. It has pitched conservatives such as Mr Sınchez who favour sticking with the current government's pro-investment programme against the more "populist" element, represented by Mr Reyes and Mr Paz, which promises more intervention as well as higher spending. But whoever wins faces a daunting task, analysts say. The next president must stimulate a weakened, aid-dependent $8bn economy still recovering from one of its worst recessions. He will also face the wrath of the International Monetary Fund if he fails to rein in a ballooning fiscal deficit.
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