Latin America and Right-Wing Populism

Latin America is moving rightward. Why is this happening, and who are the major leaders?

Initial Publish Date 
Last Updated:N/A
Report Focus Location: Latin America
Authors: TW
Contributors:
GSAT Lead: MF

Introduction

In recent years, South America has experienced a notable resurgence of leftist political movements alongside ongoing conservative influences. Bolivia and Peru saw leftist victories with Evo Morales and Pedro Castillo, while Chile and Colombia elected Gabriel Boric and Gustavo Petro respectively. Luiz Inácio Lula da Silva's return in Brazil marked a shift away from Jair Bolsonaro's right-wing leadership. However, Uruguay, Ecuador, Paraguay, and Argentina have seen conservative electoral gains. Venezuela remains under Nicolas Maduro amidst economic challenges. The region faces instability and democratic fragility exacerbated by issues like Colombia's peace process setbacks and pandemic impacts, reflecting a complex political landscape in flux. While most organizations understand and are comfortable operating under left-wing governments in Latin America, the wave of right-wing populism has altered the political landscape to a significant extent. Their ability to govern will likely determine the extent that other countries will elect right-wing populist governments. In countries where there are those governments, though, there will be positive and negative impacts to society and organizations that will need to be considered over the medium term.

Causes of Right-Wing Populism Growing

The Peterson Institute for International Economics noted that the Latin America's economic and political landscape has changed extensively from the 1990s to the present day. During the 1990s, the region was hit hard by financial crises in Mexico, Argentina, Asia, Russia, and Brazil. Despite these shocks, Latin America briefly sustained growth rates above global levels before the 2008 financial crisis, with annual growth around 3.5% according to the IMF. Between 2010 and 2012, Latin America experienced a modest economic boom, averaging just over 4% growth. South America faced severe economic challenges in the 2010s due to the end of the commodity boom, exacerbated by the COVID-19 pandemic. Governments responded with significant public spending, but this led to inflation and economic stagnation. Progressive leaders like Gabriel Boric in Chile and Gustavo Petro in Colombia initially promised reforms but have since faced political setbacks and corruption scandals.

Recently elected leftist leaders may bring constructive policies focused on environmental protection and human rights, but there is also a recognition that these leaders may adopt macroeconomic policies unable to manage social spending pressures and inflation. However, the broader societal context is marked by deep divisions, as evidenced by low voter turnout, widespread dissatisfaction, and heightened political polarization, surpassing levels seen in the previous electoral cycle from 2015 to 2018. The outlook remains challenging, exacerbated by a trend towards political extremism, which threatens policy continuity. According to the European Consortium for Political Research’s analysis, “Chilean and Colombian economies have stalled. While emergent economies are expected to grow by 4% in 2023, Colombia will reach only 1.6%. Chile may even experience a contraction of -0.5%.” As such, “[o]ver half of Chileans disapprove of President Boric’s performance, while only 33% support it. Likewise, 64% of Colombians think President Petro is making a bad job of governing, and only 29% support him.”

That is where right-wing populism comes in as an alternative to continued leftist policies that have not successfully managed budgets and inflation. In addition, Friedrich Ebert Stiftung argues that right-wing populism in Latin America is due to the “politicisation of socio-cultural aspects over socio-economic ones, which is intended to engage not only well-off segments of society, but also working-class sectors that hold conservative ideas on moral issues.” Those not convinced of these socio-cultural issues are trending towards right-wing populism because of economic issues and a lack of growth. Criminality is also a critical concern that is leading to support for more authoritarian policies. People are valuing safety and security over “human rights.”

Critical Leaders of Right-Wing Populism

Economic woes, rising crime, and public discontent have bolstered the popularity of hard-right figures in Chile and Colombia. They position themselves as outsiders ready to restore national pride and address perceived moral decay. For example, Javier Milei's recent victory over Argentina's leftist incumbents signaled a potential turn away from progressive leadership. Analysts attribute Milei's win to a desire for change and dissatisfaction with the status quo. Similar trends are anticipated in upcoming elections in Chile and Colombia. This shift echoes trends seen with figures like El Salvador's Nayib Bukele, who focuses on tough security measures at the expense of legal norms. Figures like José Antonio Kast (Chile) and María Fernanda Cabal (Colombia) advocate for conservative policies reminiscent of past regimes, tapping into public anxieties.

The emergence of the right-wing populist in Latin America is marked by leaders such as Bolsonaro in Brazil, Bukele in El Salvador, Kast in Chile, and Milei in Argentina, who collectively represent a shift towards assertive cultural conservatism and anti-establishment sentiments. These leaders share several core characteristics: staunch opposition to abortion, LGBTQ+ rights and social democratic policies; a focus on law and order, advocating tough security measures; and a preference for smaller government and reduced state intervention in the economy. Despite these shared positions, each leader adopts a unique approach shaped by their country's specific challenges and political landscapes. Bolsonaro, for instance, appealed to evangelical Christians and the military, emphasizing traditional family values and security concerns while displaying skepticism towards free-market economics. Bukele, known for his tough stance on crime, gained popularity through aggressive anti-gang measures but has been less clear on economic policy and globalism despite his claims at international forums.

Meanwhile, Kast has positioned himself with a strong emphasis on conservative morality and national security, proposing stringent immigration controls and advocating for a smaller state and lower taxes. Milei, an "anarcho-capitalist," campaigned on economic reform and anti-corruption, recently aligning more closely with his peers on moral issues like abortion and gender rights. Despite their ideological overlaps, these leaders face diverse political fortunes. Bukele remains highly popular and secure in power, leveraging his security successes to override constitutional checks. In contrast, Bolsonaro's political future is uncertain due to electoral bans and legal troubles, while Milei and Kast navigate challenges within their respective political landscapes. In essence, while Latin American right-wing populism embodies a united front against liberal values and social democracy, each leader's unique strategy reflects distinct national contexts and aspirations, shaping their paths forward amid regional and global political dynamics.

Javier Milei

Javier Milei election in Argentina has created a “libertarian laboratory” for Latin America to show whether market economics can work for the continent in the 21^st century. Argentina has achieved a notable milestone in its battle against inflation, with food and beverage prices remaining stable at 0% during the third week of June. Milei praised this achievement, suggesting it signaled a rewriting of economic theory under his administration. Despite this progress, Argentina continues to face significant inflation challenges, with an annual increase of 276.4%. His initial economic package devalued Argentina’s currency by 50%, and it cut stat subsidies and the number of government ministries by half. This brought the country’s fiscal deficit down from 2 trillion pesos ($120 billion) in December 2023 to a surplus of 264.9 billion pesos ($290 million) in April 2024.

José Antonio Kast

José Antonio Kast, a lawyer, devout Catholic, and father of nine, run twice in the past. In 2017, he had obtained fourth place with 7.93% of the vote, but then in 2021 he obtained 27.9%. If he runs in the 2025 election, then it is likely he could win, especially considering the gains his party made in the constitutional council (winning 23 out 51 seats). Kast controversially has said positive statements about Augusto Pinochet, the former dictator of Chile from 1973-1990, but that may be a political positive the further the country gets away from that era as people overlook the human rights abuses while remembering the economic development and stability he brought. However, Kast has not advocated anti-democratic ideas like some right-wing populists, and he is likely to promote social traditionalism and market economics.

Nayib Bukele

President Nayib Bukele secured reelection in El Salvador on February 4, winning approximately 83% of the vote for his second term because of his immense success in neutralizing violent gangs. Bukele’s election is an important indicator of the future of Central and Latin American politics as he has demonstrated a path to deal with the extreme levels of violence by gangs. His administration’s policies have focused on widespread arrests and detainment equaling about 1% of the population. Despite the extra-constitutional measures and arrest of innocent people implemented during the “state of emergency,” the increase in safety and security is extremely popular with voters. By securing a second term, there should be an expectation of continued mass arrests and detainments in El Salvador during the second administration. As a CSIS report notes, “[T]he draconian steps taken by President Bukele in El Salvador, which have led to an over 50 percent decline in murders at the expense of throwing over 60,000 people in prison—many without due process—are popular.”

Jair Bolsonaro

Former Brazilian President Jair Bolsonaro represents the anti-democratic forces of right-wing populism in South America, especially his defense of the military junta in Brazil’s history. He allegedly proposed a plan to military commanders to remain in power after losing the 2022 election. Both commanders refused Bolsonaro's plan and warned him of potential arrest if he pursued it (Bolsonaro has denied supporting a coup). His supporters engaged in a major protest at the three main houses of political power in Brasilia as Lula returned to power because Lula is a far-left leader who was convicted of money laundering and corruption. Even with all of these potential issues, Bolsonaro remains a popular figure on the Brazilian right.

Impacts to the Region

There are going to be impacts to security, economics, and political stability that organizations will have to navigate in this rightward movement in Latin American countries. Each policy choice by these right-wing populist leaders will have positives and negatives, and organizations will need to carefully assess them in each country. To start, Bukele’s anti-gang policies have had an extremely positive impact on El Salvador as violence has precipitously declined, and people are overwhelmingly supportive of his actions. Countries that emulate Bukele will have increased security by reducing gangs and organized crime, but this will lead to human rights violations. This will not be the first time Latin American countries have chosen security over human rights, though that was during the Cold War when governments were fighting Marxist terrorists.

Financially, many governments across Latin America is under severe stress, limiting the region’s ability to respond effectively to new crises. The region's previous resource boom, fueled by Chinese demand, significantly reduced poverty through extensive social spending, but this era has ended. The COVID-19 pandemic further exacerbated economic challenges, forcing governments to increase deficit spending while economies contracted during prolonged lockdowns. As a result, several countries emerged from the pandemic with significantly higher debts and weakened credit ratings, reducing their flexibility in handling future shocks. Despite a modest economic growth of nearly 4% in 2022, the regional economy has suffered since then.

Left-wing government policies had led to financial failures, and then right-wing governments removing subsidies has led to major protests. Latin America is grappling with profound challenges related to food insecurity, price volatility, and economic strain. A report by the Pan American Health Organization reveals that more than 22% of the population in this region cannot afford a healthy diet. Governments have implemented subsidies for essential goods like food and fuel, but high inflation and increasing debt payments are straining their capacity to sustain these supports. For example, former President Cristina Fernandez’s Peronist policies of more social programs and direct cash payments contributed to inflation.

Right-wing governments are responding to those problems with a monetarist approach. As mentioned above, such market approaches are likely to have positive economic benefits like lower inflation and higher GDP growth over the medium. In the interim, though, there will be economic pain points like higher unemployment and reduced subsidies. Economic pressure has frequently triggered social unrest, as seen in Chile with protests sparked by a public transportation fare increase in 2019, and more recently in Panama and Suriname due to rises in gas prices and cuts to subsidies on electricity and fuel, respectively. Therefore, it is highly likely that as right-wing governments attempt to implement neoliberal economics policies that will have a positive economic impact over the medium term, there will be protests and social unrest over the short term in response to the transition.

Finally, it is credible that there will be coup attempts and anti-democratic movements, such as the January 2023 protests in Brazil and June 2024 coup attempt in Bolivia. There is also highly likely to be continued political volatility in Latin America, with swings from left-wing to far-right ideologies expected in upcoming electoral cycles. This polarization, coupled with economic discontinuities, poses significant risks to achieving sustainable long-term growth in the region. The emergence of far-right movements, mirroring global trends, further complicates the political landscape and challenges prospects for stable governance and economic development.

RileySENTINEL

Our RileySENTINEL regional, country and situation reports, developed and provided by Riley Risk resources in strategically positioned locations, provide comprehensive updates and in-depth analysis of high-risk environments and events.

This reporting and analysis support enables our clients to access timely and pertinent on-the-ground information, bolstering their decision-making capabilities in volatile operational contexts. 

Reach out to us today using the engagement meeting link here to learn more about how our risk advisory services can bolster your business operations and help you accomplish more!

© 2024 RileySENTINEL. All rights reserved. No part of this report may be reproduced or transmitted in any form without prior written permission from Riley Risk, Inc.