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Chile and Colombia offer contrasting visions of public leadership in the new 'pink wave'

Updated: Mar 2, 2023

When Colombia elected its first leftist in Gustavo Petro last year, observers began to return to the narrative of a “pink wave” of left-wing victories that began with Gabrielle Boric’s victory in Chile. However, this time around the divides between policy and political approach are marketed, with the two leaders reflecting different visions for left wing policy on the continent. This divide was made clearer this week by risk sentiment diverging on Petro’s continued shakeup of Colombia’s conservative economic order and Boric’s promised return to fiscal stability.

As FMN reported back in October, Boric promised to eliminate the budget deficit and return to the stability that made Chile the region’s investor favorite. This week he did just that by delivering a 1.1% budget surplus for the first time in ten years.

Observers were cautiously optimistic that Chile had returned to the safest investment destination that investors had grown to expect over the last half century. Meanwhile to the north, the Colombian peso became the worst performing currency in the region and bonds sold off on projections of growing budget deficits and continued policy uncertainty.

On foreign affairs too, Petro and Boric have ended up on different sides of disagreements of the constitutional status of the current government in Peru - which banned Petro from the country last week, Venezuela, and Nicaragua. The Colombian president's more fraternal approach with the region's illiberal leftists contracts with Boric who has presented a globally credible stance against these regimes while taking a more measured approach to regional affairs.

Both leaders are breaking from norms and pushing reforms, but Borics deft and more technocratic approach highlights how success as a left-wing president in the 2022 wave requires more than just a moderate finance ministry and big social policy ideas to be stable and successful.

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