Aug. 15 (Bloomberg) -- She’s an environmental activist and an evangelical abortion opponent. She’s been called pro-market and a socialist. And now Marina Silva is the kingmaker in one of Brazil’s most-contested presidential elections.
Silva, 56, became the wild card in Brazilian politics after her running mate, presidential candidate Eduardo Campos, died in a Aug. 13 plane crash. While political analysts and investors say she will probably replace him on the ballot, her stance on the environment clashes with vested interests in a party she joined after failing to form her own, said Andre Cesar, director at public policy and business strategy consultants Prospectiva.
Silva stands to upset the campaigns of her two leading contenders if she jumps into the race. She could divide the vote enough to rob President Dilma Rousseff of a first-round victory, while denying candidate Aecio Neves a spot in the second round, UBS AG said. A candidate needs more votes than all others combined to win in the first round.
Stocks have swung between losses and gains since Campos’s death as the prospect of a Silva candidacy raises questions about her policies and experience, said Alvaro Marangoni, a partner at investment adviser Quadrante Investimentos Ltda.
“What the market wants is a fiscal adjustment and inflation under control, no matter who it is,” Marangoni said by telephone. “The problem with Marina is that she’s a complete question mark in that sense. She hasn’t positioned herself on it and doesn’t have a track record either.”
Brazil’s Socialist Party President Roberto Amaral is calling for a meeting of the group’s executive for Aug. 20 to decide on who will replace Campos, according to two party aides. Silva, who joined the Socialist Party late last year, said at a news conference following Campos’s death that it was a time to mourn and didn’t comment on whether she would seek the nomination.
Press officials from Neves’s, Rousseff’s and Silva’s campaigns declined to comment on the impact Campos’s death may have in the election, citing the mourning period.
Silva spent her childhood tapping rubber trees in the Amazon rainforest and worked as a maid before entering politics. She projects an anti-establishment image that appeals to younger voters disillusioned with government, said David Fleischer, professor of political science at the University of Brasilia.
While running as the Green Party’s presidential candidate against Rousseff in 2010, Silva came in third with 19 percent of the vote. In this year’s race, Campos was running in third place, polling 9 percent, behind Neves’s 23 percent and Rousseff’s 38 percent in an Aug. 3-6 Ibope survey. The margin of error was two percentage points.
Since 2010, the economy has slowed, inflation has accelerated and a new middle class has increased demands for improved public services. More than 1 million people protested last year against rising costs of living, corruption and poor health and education.
“If anything her potential support base has grown over the past four years,” Fleischer said. “She’s seen as an outspoken, principled and honest person. That appeals to many in a country where politicians are seen as corrupt and self-interested.”
At the same time, she is remembered by investors and some business people as a candidate who committed in 2010 to orthodox fiscal and monetary policy that she would leave in the hands of ministers with top-level expertise, Citigroup Inc. analyst Stephen H. Graham wrote in an Aug. 13 report.
“A potential Silva administration is likely to embark upon market-friendly economic policies,” political risk consultancy Eurasia Group said in a note to clients yesterday. Silva is “a potentially more competitive candidate” than Neves, prompting Eurasia to reduce the probability of a Rousseff re-election to 55 percent from 60 percent.
Campos’s and Silva’s economic adviser, Eduardo Giannetti, said in a May interview Brazil needs to rein in spending and increase interest rates at the outset of the next government to help ease inflationary pressure.
“We have a problem that signals a series of difficulties that in my opinion could compromise the most important instruments of our economic balance, which are the tripod: inflation targeting, floating exchange rate and the primary surplus,” Silva said in a webcast interview with Folha de S. Paulo newspaper in September, before she joined Campos as his vice presidential running mate. “If we continue with these risks to our economic balance, we could hurt the conquests of the prior government.”
Silva entered politics fighting deforestation in the Amazon alongside the legendary conservationist Chico Mendes, who was assassinated in 1988. As environment minister under President Luiz Inacio Lula da Silva she sought tighter regulations for large infrastructure projects, such as the Belo Monte hydroelectric dam. She stepped down when Lula overlooked her in appointing the chief of a new Amazon task force.
It’s that hard stance that has alienated some members of her party whose constituencies have strong roots in farming and agribusiness, which has been blamed for contributing to Amazon deforestation, University of Brasilia’s Fleischer said.
Silva has struggled with several health issues, including malaria, hepatitis, leishmaniasis, and metal poisoning.
She is a member of the evangelical church and last week accompanied Campos to a meeting with 2,000 pastors, according to a church press official. Evangelicals are the fastest-growing religious group in Brazil and accounted for 22 percent of the population in 2010, according to most-recent census data from the national statistics institute. Catholics’ share of the population fell to 65 percent of the population from 74 percent in the same period.
While investors await word on whether Silva will run or not, the debate about what exactly she stands for will continue.
“When people ask me if I’m on the right or left, I say I am a progressive sustainabalist,” Silva said in a December posting on her Facebook page.
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