Last weekend, Argentina experienced something of a shock as presidential candidate Daniel Scioli of the governing Peronist party was forced into an historic second voting round by the conservative mayor of Buenos Aires, Mauricio Macri.

Following twelve years of Kirchnerismo — the most radical form of the Peronist umbrella movement to govern to date — Argentina is set for a change in political direction. The extent and speed to which the country’s political course shall be altered, though, depends on the outcome of the presidential runoff next month.

Scioli, the frontrunner endorsed by outgoing president Cristina Fernández de Kirchner, held a lead of up to 10 points according to preelection polls and was widely expected to continue Peronist governance. He needed either 45 percent of the vote or 40 percent with a 10-point lead over his nearest rival. In the event, his lead cut to just over 2 percent: 36.8 percent support versus 34.3 percent for Macri.

In spite of Kirchner’s relatively high 40 percent approval rating, it is widely acknowledged by both candidates seeking to replace her that there is need for economic reform and to rebuild relationships domestically and abroad. With the economy suffering under low commodity prices, reforms are inevitable.

The standoff between the Argentinian government and American hedge fund creditors dating back to the country’s catastrophic 2001 default, worth $100 billion, still hangs over the country. While the majority of creditors have compromised, 7 percent are unwilling to make a proposed bond swap. Kirchner has called them “vulture funds” and “economic terrorists.” Meanwhile, her inability to come to terms with the holdout hedge funds has left Argentina locked out of global financial markets.

This has contributed to a policy of strict currency and capital controls. With demand remaining high, however, a black market has emerged that highlights a currency overvaluation. Inflation of 15-25 percent has resulted in diminished purchasing power and stagnant growth. Government and local business have made agreements to stabilize the prices of basic good but critics say that this only distorts the economy further.

Scioli faces a balancing act to keep the left-wing Kirchnerista supporters on his side with commitments to continued generous social welfare spending while also promising “gradual change.” He is accused of being a Kirchner puppet, seeing that her loyal supporter, Carlos Zannini, is acting as his running mate.

In fact, Scioli has not always seen eye to eye with two-term President Kirchner and is rather a disciple of former Peronist president Carlos Menem whose shock therapy, liberalizing and privatizing tendencies Kirchner has fought hard to overturn.

A former businessman, Scioli has promised tax cuts for the middle classes, the removal of subsidies on energy bills and dialing down the confrontational rhetoric on the Falkland Islands, the British overseas territory Argentina claims as its own.

Macri and his alliance, Cambiemos, on the other hand, have campaigned on a promise of “historic change.” Theirs is a tall order: no candidate has won on a conservative ticket since the full restoration of democracy in 1983.

Macri vows to dismantle capital controls and trade restrictions “on day one” but has also promised to keep some social measures in an effort to soften his patrician image.

The pro-business son of a construction magnate is also seen as most likely to come to an agreement with the holdout hedge funds and create a climate for greater foreign investment.

The challenge now for both candidates is to attract voters in the middle. Dissident Peronist candidate and governor of Tigre, Sergio Massa, got 21.3 percent support in the first voting round and will see himself as something of a kingmaker. The extent to which Scioli and Macri can broaden their appeal or strike alliances with Massa could decide the outcome of the election.

With the Peronists losing their congressional majority and the momentum firmly with their side, this is the best chance Argentina’s right has had in decades to retake power. But winning the election will be only the first step on a long road to achieve something resembling stability in a country that has been in a perennial cycle of debt default and restructuring for much of its history.