By Monica Machicao and Lucinda Elliott
LA PAZ (Reuters) -Conservative former president Jorge "Tuto" Quiroga is banking on a bold economic rescue plan to win Bolivia's October 19 presidential runoff, where he faces centrist Senator Rodrigo Paz.
Quiroga placed second to Paz in the August 17 first round with 27% of the vote, as the ruling Movement to Socialism founded by Evo Morales suffered its biggest defeat in decades. Neither candidate secured the 50% needed to win outright, triggering Bolivia's first runoff since its return to democracy in 1982.
A longtime opposition figure, Quiroga, 65, served as interim president from 2001 to 2002. He has campaigned on promises to stabilize an economy battered by inflation - at its highest since the 1980s - and dwindling foreign reserves.
"The country is broke," Quiroga told Reuters at his home in La Paz in August. "We need dramatic, radical change, and I intend to bring it."
Quiroga supports deep cuts to public spending and proposes curbing universal fuel subsidies, maintaining them only for public transport and vulnerable groups. His economic plan includes closing or privatizing loss-making state-owned companies and eliminating ministries in a move he says will reduce bureaucracy.
However, those policies could alienate Bolivia's Indigenous majority, many of whom have become disillusioned with the socialists but remain skeptical of the right after earlier privatizations that led to steep price rises for basic utilities. The specter of street protests, should he win, may test his resolve.
Quiroga rose through the ranks to become finance minister in 1992 under President Jaime Paz Zamora — the father of his current opponent. In previous presidential attempts, Quiroga lost twice to Morales, who was barred from this year's race.
Despite some voters' fears about his plans for state job cuts, privatization of natural resources, and reduced social welfare, Quiroga insists his policies will benefit ordinary Bolivians.
"The inflation that causes you so much anxiety is going to end," he said during a campaign stop in Samaipata, in Bolivia's rural interior. Children and older people will be exempted from benefit cuts, he says.
'I SPEAK TEXAN'
If elected, Quiroga says he will seek external financing from institutions like the International Monetary Fund, secure new trade partnerships, and reform the judiciary.
Quiroga also proposes granting Bolivians individual ownership rights over state-controlled natural resources — including lithium and natural gas, via a mutual fund structure — a step critics say would weaken state control over strategic resources.
He aims to thaw Bolivia's frosty relations with Washington after years of alignment with China, Iran, and Russia.
"I speak Texan, not English," he joked, referring to his time at Texas A&M University and his stint at multinational IBM in Austin.
Since no party has won a majority in either chamber, Quiroga's ability to forge alliances would be tested. His Alianza Libre (Free Alliance) secured 43 of 130 seats in the lower house and 12 of 36 in the Senate. That is behind Paz's party, which has 47 congressional seats and 16 in the Senate.
A September Ipsos Ceismori poll found 59% of respondents saw Quiroga as the candidate most capable of fixing the economy.
His challenge is to win over voters who backed other candidates, including the just under 20% who supported businessman Samuel Doria Medina, who placed third and was eliminated.
Opinion polls suggest a tight race. Quiroga leads voting intentions with 42.9%, ahead of Paz with 38.7%, according to an October survey by Red Uno. Another poll indicated a late swing toward Paz, with 10% of undecided voters moving in his direction.
Gonzalo Gutierrez, 33, voted for Medina in the first round and remains undecided.
"'Tuto' seems like the best candidate because of his experience, but he doesn't have my vote yet," he said from La Paz.
(Reporting by Daniel Ramos and Monica Machicao in La Paz and Lucinda Elliott in Montevideo. Editing by Christian Plumb and Rosalba O'Brien)
