Colombia at Risk of Electing Its First Socialist President

French voters head to the polls this weekend to decide between incumbent president Emmanuel Macron and far-right candidate Marine Le Pen, but the election investors should be keeping their eye on is happening next month in Colombia.

On May 29, the South American country could elect its very first leftist president should Gustavo Petro receive a majority of the vote. (A runoff election could determine the final winner.) The former congressman and mayor of the capital city of Bogotá, Petro is an unabashed admirer of U.S. senator Bernie Sanders, a self-proclaimed “democratic socialist,” and Hugo Chávez, the hardline socialist president of Venezuela from 1999 to 2013, when he died of cancer.

The two were close friends, in fact, and Petro reportedly attended Chávez’s funeral. But the alarming similarities don’t end there.

Chávez and Petro, Cut from the Same Cloth

Before entering politics, both Chávez and Petro were members of militant rebel groups. As a candidate, Chávez vowed to end the expansion of Venezuela’s oil sector, despite it sitting on the world’s largest proven reserves. Petro, 61, similarly has promised to take an adversarial stance against the mining industry, saying in 2018 that companies involved in oil and gas “will not find a friendly government” if he becomes president.

This would devastate Colombia’s economy. Crude oil represents about half of its total exports and around 10% of its national income. That revenue could disappear overnight, with no replacement to pick up the slack.

It’s hard to imagine now, but at the time of Chávez’s election 23 years ago, Venezuela was the world’s fifth largest crude producer and the top exporter of oil products to the U.S. Today, under the Nicolás Maduro regime, its oil industry is practically nonexistent. In January, the country produced an estimated 668,000 barrels per day (bpd), a far cry from the 3.5 million bpd it regularly produced in 1998.

You can see the tragic results below. Facing worsening violence, hyperinflation and a poverty rate as high as 96%, some 4.5 million Venezuelans fled their country between 2015 and 2019, making them the world’s second largest refugee population at the time after Syrians. Approximately half of these freedom-seekers poured into neighboring Colombia, where about 4% of the population is now Venezuelan-born, up from close to 0% just a few years earlier.

Venezuelan Population in Coloumbia Has Surged Since Maduro Took Power