Humala widens lead in Peru vote

LIMA, Peru - Nationalist Ollanta Humala, who has rallied the poor but angered the rich with pledges to redistribute Peru's wealth, led the presidential election on Monday and was likely headed to a runoff.

With about 76 per cent of the vote counted, Humala, a 43-year-old former army commander and ally of leftist Venezuelan President Hugo Chavez, had 29.7 per cent, election officials said.

Two other candidates were locked in a close race to determine who would face Humala in a second round since no candidate appeared on pace to capture more than 50 per cent.

Left-of-center former President Alan Garcia trailed Humala with 24.98 per cent, moving slightly ahead of Lourdes Flores, a pro-business conservative, with 24.62 per cent. As the count continued, Garcia gained in rural areas while Flores, whose stronghold is Lima, struggled.

"I consider myself the winner," Humala told foreign reporters as electoral officials tallied votes from Sunday's election. "I hope the traditional political forces take note."

Investors were watching closely to see whether the business favourite Flores or the leftist Garcia would reach the runoff.

"It's in God's hands," Garcia told reporters.

Pre-election polls showed Humala would likely lose to Flores in a runoff but would face a tight race with Garcia.

"We still have about 33 per cent of the votes to be counted and a lot of these votes come more from remote areas," said HSBC Securities strategist Vitali Meschoulam. "These votes will probably favour either Humala or Garcia," he said.

Election authorities said it could take up to 20 days to decide second place. The run-off must take place within 30 days after the final official result is announced. A close race could also lead to legal challenges of the ballot count.

Lima's stock market lost its initial gains on optimism that Flores would advance, as investors fretted about a possible Garcia-Humala runoff. The market closed up 2.3 per cent, down from a 6 per cent morning surge, the biggest intraday rise since 1995.

Humala led a failed coup in 2000 and has been accused of human rights abuses as a soldier, which he denies. He also pledges to industrialise Peru's production of coca, raw material for cocaine. If elected, he would be the latest in a string of Latin American leftists to come to power challenging US policies like coca eradication.

Peru is the world's No. 2 cocaine producer after Colombia.

Humala, harassed by thousands of people as he voted in a middle-class area Sunday, urged Peruvians not to be afraid of a Humala presidency. "People have to realise, we don't want any kind of traumatic shock for Peru," he said.

"We're not going to expropriate companies or property."

Most popular among the long-neglected poor, Humala pledged to service Peru's $30 billion debt if elected and keep a small fiscal deficit despite his generous welfare plans.

"Humala is our voice, the voice of the people," said Elvis Orosco, a construction worker in Lima. "I'm praying he'll be president."

The business community fears a second round between Humala and Garcia, who presided over economic collapse during his 1985-1990 rule. Garcia, 56, saw his backing rise in the final pre-election polls, as support ebbed for Flores, 46, a lawyer who has struggled to connect with the poor.

"I'm really holding out for Alan. He's the only one who can make a difference for Peru," said Octavio Pinedo, who is unemployed.

Flores, who topped polls only months ago, has played up her potential role as Peru's first female leader in a country where women are perceived as more honest.

Whoever is ultimately elected president will face a fragmented Congress in which no party has a majority, election results showed, making it harder to push through legislation.

- REUTERS