(Bloomberg) -- Former World Bank economist Rodrigo Chaves won Costa Rica's presidential election pledging to cut the deficit and attract foreign investment.
His rival Jose Maria Figueres conceded, and Chaves led with 53% to 47% for Figueres, with 98% of the votes tallied on Sunday night.
Long an oasis of stability in a region plagued by violence, Costa Rica had a choice of president between two investor-friendly candidates, setting it apart from neighbors led by fiery radicals such as El Salvador's Nayib Bukele and Nicaragua's Daniel Ortega.
Chaves, 60, promised to boost growth with more foreign investment and higher levels of tourism. The U.S.-educated president-elect has pledged to reduce the government's fiscal deficit and said he favors a close relationship with the International Monetary Fund. The government signed a $1.8 billion extended fund facility with the multilateral lender last year.
In his victory speech Chaves said he would modernize the state, create jobs and govern with “transparency and austerity.”
Living Standards
Costa Rica has long enjoyed some of the best living standards in Latin America, but has more recently suffered from mediocre economic performance and seen its growth rate lag behind peers such as the Dominican Republic and Panama.
The nation's economy expanded 3.9% last year and will grow 3.5% this year, according to the International Monetary Fund. Consumer prices in February rose 4.9% from a year earlier, above the bank's 2-4% inflation target range.
Read More: Even Bill Gates Would Struggle in Costa Rica
Costa Rica's dollar-denominated bonds traded higher on Monday, with those due in 2045 at 99.8 cents on the dollar. The nation's bonds have returned 1.4% this year versus an average loss of 9.5% across emerging markets, according to data compiled by JPMorgan Chase & Co.
Chaves, who earned a Ph.D. in economics from Ohio State University, promised to cut red tape to foster an environment where entrepreneurs can thrive and said he can promote a low interest rate environment to spur investment.
He worked 27 years at the World Bank, becoming country director for Indonesia in 2013. During the campaign, he came under fire over sexual harassment allegations made while he worked at the bank. He denied any wrongdoing, and attributed the accusations to misunderstandings caused by cultural differences.
Chaves served six months as Costa Rica's finance minister under President Carlos Alvarado before stepping down in May 2020 over what he said were differences with Alvarado on spending cuts. Chaves will be sworn in as president on May 8.
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