Political Risk Analysis - Fractured Field Will Bolster AMLO's Presidential Bid - JAN 2018

BMI View: Anti-establishment sentiment amid rising security and corruption concerns will bolster support for left-leaning populist Andres Manuel Lopez Obrador (AMLO) in Mexico's 2018 presidential election . While negative partisanship wil l likely cap his support , a large and fractured field could enable an AMLO victory .

A large and divided field of candidates, anti-establishment sentiment, and fractures within conventional political parties will give leftist populist candidate Andres Manuel Lopez Obrador (AMLO) a solid chance to win the Mexican presidency in 2018. AMLO lost out to the Partido Revolucionario Institucional's (PRI) Enrique Pena Nieto in 2012 and the Partido Accion Nacional's (PAN) Felipe Calderon in 2006. However, weakened support for Mexico's major parties amid mounting corruption and security concerns will increase the attractiveness of AMLO's position as the anti-establishment and anti-corruption candidate. Further, the inclusion of a large number of independent candidates will change the dynamic of the 2018 race, lowering the threshold for victory and likely supporting AMLO's bid.

AMLO's Movimiento Regeneracion Nacional (Morena) party currently leads in the polls as of October with 19.3% of voter intentions, up from 12.1% in September 2016. The establishment opposition PAN receives 19.0% and the ruling PRI 18.1%, while 27.5% of voters remain undecided. Benefiting from by far the highest name recognition among the crowded field at 93.4%, AMLO fares slightly better when pitted against potential opponents, drawing between 22 and 25% of voter intentions according polls conducted by Consulta Mitofsky in October. However, we note that Mexico's major parties have yet to select their candidates.

Morena, Independents Among The Largest Gains
Mexico - Voter Intentions In 2018 Presidential Election By Party, %
Source: Consulta Mitofsky, BMI

30% Of The Vote Could Be Enough

Negative partisanship will likely limit AMLO's ability to make further gains in the polls. 30.9% of voters have a negative perception of AMLO, the highest among potential candidates. While we do not expect AMLO will significantly grow his base of support in 2018 compared to the past two presidential elections, a larger pool of candidates means that Mexico's next president could win with as little as 30% of the vote. AMLO received 31.6% of the vote in 2012 to Pena Nieto's 38.2%, and 35.3% in 2006 to Calderon's 36.4%. In 2018, however, AMLO will not benefit from a united left under the PRD as he did when he drew his best result in 2006. Current polling suggests that AMLO may need to form an alliance with another political party in order to have the best possible chance to seize the presidency, something he has proven reluctant to do in this cycle and failed to do in the 2012 race.

Larger Field Will Benefit AMLO
Mexico - Presidential Election Results, %
*note: In 2012 AMLO ran under a PRD, PT, CV coalition ticket, Source: INE, BMI

Independent Candidates Will Broaden The Field

A large number of independent candidates will broaden the field significantly in 2018, which will likely benefit AMLO's bid. This is the first year that non-party aligned candidates will be allowed on the ballot in Mexico's presidential election, and 86 candidates have registered as independents according to the Instituto Nacional de Elecciones (INE). However, each candidate is required to collect signatures equal to 1% of the total enrolled voters (866,593) in order to appear on the ballot. The final tally of candidates will not be confirmed by INE until February 2018, but we expect that at least four independent candidates are likely to qualify, which would place the total pool of candidates on the ballot at seven compared to four in 2012 and five in 2006.

Zavala Candidacy To Undermine Unified Opposition Bid

An independent bid by Margarita Zavala, a 30-year PAN member and wife of former President Felipe Calderon, bodes ill for the prospects of a unified bid by established opposition parties under the Frente Ciudadano por Mexico (FCM) banner ( see ' Independent Zavala Bid Would Undermine FCM Coalition ' , October 10). Zavala exited from the PAN and registered as an independent candidate in October following a dispute with PAN president Ricardo Anaya over the party's presidential candidate selection process. In recent polling, Zavala drew over 40% of PAN voter intentions and will likely siphon off a substantial amount of support from the eventual FCM candidate, as PAN represents by far the largest member of the coalition. Further, fractures within the PAN and lingering questions about how the FCM presidential candidate will be selected could break up the FCM coalition all together, widening the presidential field even further.

PRI Down, But Far From Out

While support for the ruling PRI has been eroded considerably by security and corruption concerns, the party will still have a strong chance of retaining the presidency in 2018. The approval rating for current President Enrique Pena Nieto has fallen to 22% as of August 2017, from 54% in December 2012. However, the PRI, which has dominated Mexican politics for the vast majority of the 90 years since the revolution and currently governs over 62% of Mexico's municipalities, will benefit from a large and well-positioned electoral machine. A strong showing in June gubernatorial elections, despite a challenging environment, shows that the PRI remains a powerful political force ( see ' PRI Remains Political Force, But Significant Frustration With Politics As Usual ' , June 26). Further, the party has yet to select a candidate, but the current front-runner, Finance Minister Jose Antonio Meade, is a well-respected technocrat and remains unblemished by corruption scandals. The PRI may also benefit from the rift within the PAN. Should FCM fracture or Zavala siphon sufficient votes from the coalition, PAN voters fearful of an AMLO victory could see the PRI as the establishment party with the best chance of victory.