Brazil’s Gambling Future Uncertain as Runoff Presidential Election Required

Posted on: October 3, 2022, 12:02h. 

Last updated on: October 4, 2022, 10:57h.

Erik Gibbs Read More
Expertise: Asia Pacific Gaming, Gaming Business, Global Gaming.

In the run-up to Brazil’s government elections, former president Luiz Inácio Lula da Silva was the slight favorite to beat the country’s current president, Jair Bolsonaro. He did, but the margin wasn’t enough to avoid a second vote, which means there’s still no clear winner.

Former Brazilian President Luiz Inácio Lula da Silva
Former Brazilian President Luiz Inácio Lula da Silva appears in front of the media in 2021 after being cleared to run for president. He and incumbent Jair Bolsonaro will face each other in a runoff election, which means the fate of expanded gambling in Brazil remains in the air. (Image: Getty Images)

Lula da Silva took the first round of the presidential elections in Brazil on Sunday. With 100% of the votes counted, the Workers’ Party candidate leads Bolsonaro, 48.4% to 43.2%.

The close results mean there will be a second round of elections. Those will take place on October 30, and could potentially see a change in the outcome.

Too Close to Call

The results of Sunday’s election weren’t what the polls predicted. Before the count began, Lula da Silva had a strong lead. He polled at over 51% of the vote, which would have meant that a second vote would be needed.

The results provided by the Superior Electoral Court (TSE, for its Portuguese acronym) offer an inside look at what was really going on. Both candidates fought hard for every vote, which means the second round will likely be even tighter.

The outcome of the presidential election will shape the country, including its gambling industry. Bolsonaro has made it clear that he’s not a big fan of legal sports betting, using that position as part of his campaign platform.

Lula da Silva isn’t enthusiastically jumping at the chance to open the industry, either. However, he seems interested in supporting the legislation if Congress were to approve it.

Bolsonaro led when the polls opened on Sunday, but as the votes started adding up, Lula da Silva narrowed the difference. With 70% of the vote in, he had pulled ahead and didn’t let go.

Because he didn’t reach 50% of the votes, a runoff is necessary. If he had only reached that threshold, it would have guaranteed him the presidency without sending voters to the polls again.

The idea that Brazil’s gambling industry would expand sometime this year was already in doubt. The outcome of the elections was never going to alter the timeframe, which means 2023 would have likely been the earliest Congress made a decision.

With such a close race, there’s a chance Bolsonaro will keep control of the government. This wouldn’t be great news for gaming operators.

House Divided

Should Lula da Silva win, he won’t have an easy job finding support in Congress. With the results of the rest of the elections in place, Bolsonaro was the clear winner in Congress.

Bolsonaro’s Liberal Party will have the most seats in the Senate, with 14 of 81. It will also control the Chamber of Deputies, with 99 of 513 seats. The majority of parliamentary representation will be conservative, which would put a hypothetical future Lula de Silva government in a difficult position.

As for the fight in the states, 11 of the 27 will be in conservative hands. Three will be in Lula da Silva’s Workers’ Party. The rest will also go to the second round. Bolsonaro won in Rio de Janeiro and is the favorite in São Paulo, the economic engine of the country.

Leading Minas Gerais, the second most populous state, will be a conservative, Romeu Zema. He once supported Bolsonaro, but now declares himself neutral.